Preapproval (loan, approval, loan, property)

[RK555]

Hi,

Can anybody please tell me....If I have a preapproval from a XYZ bank...is there any chance can my mortgage be rejected at the time of closing?

What I am asking is If I am preapproved then there wont be any worries regarding the mortgage?

Thanks in advance
RK

[mumra]

A preapproval is not a loan commitment, its just estimates. However If you are approved for a loan, you wont be denied a the time of closing. You will have to fill out an application and provide documentation to get an approval this happens several weeks before closing. The actual commitment happens after an underwriter views your application and documentation.

[annerk]

Actually some preapprovals are fully underwritten except for the property. It's basically a commitment based on a hypothetical property and can be a useful tool if you have a good idea of what you want to buy and will need a fast closing.

As long as there are no problems found during the appraisal, and the property meets the terms set out in the preapproval in relation to monthly payment, purcahse price, etc., there should be no reason to worry about the approval being withdrawn.

Do not confuse a preapproval with a prequalification. Prequals are based on undocumented information provided by the borrower and aren't worth the paper they are printed on.