Should I wait to pre-qualify for loan?

Question : Should I wait to pre-qualify for loan?

I am getting ready to begin applying for mortgages, possibly an FHA loan. As of yesterday, I paid about 1k towards credit cards to bring my balances on all cards below 10%. I believe I should not completely pay them off. Also, as of yesterday, I was told I will be getting a 5k raise at my job, which will probably begin end of this month. My question- Should I wait for the credit cards to report my latest balances and/or my new salary to show up on my report before filling out a prequalification form for a mortgage? My credit cards balances weren't really high before, Ill say just under 50%. Again, this is for prequalification, not pre-approval, so I guess the bank will recheck my credit later when the time comes. As for my salary, this is my first home, and I think Ill live well below my means, so if the increase in salary will only help with the loan amount, I can do without that. I am just so impatient and want to get this process started. Pls provide me you advice. Thanks!

kham83



Answer : Should I wait to pre-qualify for loan?

Answerer 1: Pay down credit cards only gives you a little bit more buying power - As does the raise. A pre-approval is nothing more than a loan officer taking your basic information and giving you a letter that states: Borrower is approved for a loan in the amount of $xxxxxxxx subject to underwriting approval - The best thing you can do is get a "hard approval" - which mean - your loan application actually goes to an underwriter for a full credit approval - and when the approval come out it should be subject to: Sales contract, appraisal and verifiaction of earnest money. A pre-approval is truely not worth anyting more than the paper it's written on -
One a loan officer pulls your credit that credi treport will be good for 90 to 120 days - so your credit will not re-ouled unless the credit report expires before closing date. A raise woudl need to be verified by providing complete 30 days worth of pay stubs. If you can qualify without the raise - I say go for it and use he extra for after you move into your new home.

Answerer 2 : Pre-qualifying just tells you that you will qualify if all your info. is correct. You can do it now just to make sure your debt to income will be okay & scores are okay. You're right about leaving small balances on the cards. Paying down a few cards isn't going to dramatically increase your scores though if all it took was $1000.00 to do this. The salary helps with loan amount and with debt to income but if you qualify now I wouldn't wait to buy since rates are going up. FHA requires 3.5% down & they will want bank statements to prove you have that, as well as any closing costs you will be paying.