Getting a preapproval letter isn't the same thing as applying for a loan. A preapproval letter just says that CFCU is willing to lend to you-pending further confirmation of details. A preapproval helps you shop for a home, because it lets the seller know you are a serious buyer.
You're the only one who can decide how much you can afford to spend on a home. CFCU mortgage originators preapprove you by looking at your income, assets, debts, and credit record. But your financial life is much more complicated than that. Only you can decide how much you're comfortable paying upfront and each month-which means you can decide how much to spend on a home.
- If you were preapproved for more than the home price budget you set for yourself, you can use the preapproval letter to shop for homes without changing your target home price. If you're happy with the amount you planned to spend, stick with your original budget.
- If you were preapproved for less than you were planning to spend on a home, talk with your loan officer. Ask if there was a particular factor (for example, your income) that limited the preapproval amount. You may need to adjust your home price expectations.
- Be upfront with your real estate agent. If you don't want to see homes above a certain price, say so. Limiting your search is a good way to avoid falling in love with a home that costs more than you want to spend.
If you get declined for your preapproval, don't despair. Find you why you were declined, so you can figure out what to do to improve your chances of getting a loan in the future.
- Ask your loan officer why you were declined. Was your credit score too low? Was there specific negative information on your credit report?
- If there are errors on your credit report, get them corrected.
- If you need help improving your credit, contact a CFCU staff member to discuss your options at: 607-257-8500.