Important Questions to Ask Your Loan Officer During Your Pre-Approval Process

How to Choose the Best Lender for Your San Diego Home Purchase

Loan pre-approval is one of the first important steps of your home purchase process. You will want to complete a full pre-approval with your loan officer before you start looking at homes. This will include you filling out a loan application, having your credit run, finding and supplying your loan officer with copies of your W2s, tax returns, recent bank statements, etc., and discussing your loan options with your loan officer. To make the most of your time, here is a list of important questions you should ask during the pre-approval process.

1. What is the maximum purchase price I can qualify for?

2. What will my monthly housing payment be at that price? Does that include property taxes, insurance, HOA fees, and/or Mello Roos taxes (what's the breakdown)? 

3. How much should I be prepared to pay in total closing costs for this transaction? Do those numbers change drastically if I close early vs. late in a given month and/or if I close now vs. a few months from now?

4. How do my options change if I put more money down or less money down? Does my interest rate change? How do my monthly payments change?

5. I don't want to spend the maximum, so what purchase price do I need to stay under to keep my monthly housing payment less than  $____/month?

6. What interest rate are you quoting me today, and do I need to pay any discount points or origination points to get that rate (if yes, how much will that cost)? Also what fees does your company charge for me to obtain this loan? 

7. Is my loan a slam dunk, or are there some potential hurdles/barriers that you envision with my loan scenario? What could delay my approval when I have a property under contract? What can I be working on or preparing for now to make this go more smoothly?

8. Are there any specialty programs that I might qualify for? What are the pros and cons of getting a 30-year fixed rate loan vs a 10/1, 7/1, 5/1 ARM, etc.?

9. Can I get part of my down payment from a family member or friend (and how does that work)? 

10. Is there a pre-payment penalty if I pay off the loan early? Is this a 30-year fixed rate loan (vs 15 year fixed, ARM, etc.)?

11. Could you please print my payment breakdown and closing cost estimates for a few difference scenarios (if I buy at this price with this much down, vs another price with another amount down, etc.)?

12. Do you have any personal recommendations for me based on my income/assets/etc.? 

13. Could you please supply me with a pre-approval letter after I fill out the application and send you all the supporting documents? When I write an offer on a property, are you available to send me an updated pre-approval letter (even if it's on the weekend)?

14. I realize that rates change multiple times/day and every lender could have different rates on different days. I'd like to get a competitive rate with fair fees, and ideally work with a proactive loan officer like you. Do you have any objections to me asking you for a Good Faith Estimate to compare your rate and fees once I have a property under contract?

In summary, if you have a loan officer who is willing to spend extra time educating you during your pre-approval process, there is so much knowledge you can gain by asking the right questions. You can accomplish all of this over the phone if you need to, but it's even better to take the time to meet in person (if you can). The more informed you become up front about your loan, payment, approval process, etc., the smoother your purchase transaction will go. This article was geared towards asking questions for the sake of knowledge. I have written other articles with tips on how to compare lenders, get the best interest rate and fees, etc. As always, I'm here to help, so let me know if you have any questions.

See Also: 4 Steps to Negotiating the Lowest Rate and Fees for Your Home Purchase Loan

See Also: Choosing Your Lender: What to Look for in a Loan Officer AND How a Lazy One Can Ruin Your Transaction


Justin Gramm is the founder and principal broker of Globella Buyers Realty, yourSan Diego Exclusive Buyer Brokerage.

Exclusive Buyer Agents do not list homes for sale and never represent sellers. They have no "inventory" to try to sell you. They can represent you in purchasing any home. They are specialists at representing buyers only on the buyers' side of the transaction. Exclusive Buyer Agents work to get buyers the best price and terms when they buy a home.

If you have excellent credit and plan to buy a home or condo in San Diego County within 90 days, contact Justin Gramm to hire an agent on your side of the transaction. More about Justin Gramm on . Call Justin at (858) 437-2662 or E-mail.


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