How to Get Pre-Approved for a Mortgage in San Diego

Joey Bergandi  |  March 27, 2023

What is a Pre-Approval for a Mortgage?

A pre-approval is a formal, written statement from a lender that they are willing to lend you a certain amount of money. It's not binding on them, but it does mean that they've looked at your financial situation and determined that based on what they know about your income and assets, they're willing to give you the loan in question.

Pre-approvals are typically more valuable than pre-qualifications because they come with an actual number for how much money could be available for purchase (as opposed to just ballpark figures). The main difference between these two types of applications is that with pre-approvals, lenders have done some sort of analysis on your credit history--usually including pulling one or two credit reports--and have decided whether or not they think it makes sense for them financially to issue this type of mortgage product based on those findings; whereas with pre-qualifications there may not be any kind of review done at all beyond simply asking questions about income and assets


What You Need to Get Pre-Approved for a Mortgage in San Diego

To be pre-approved for a mortgage in San Diego, you'll need to gather the following documents:


Financial documents: This includes your pay stubs and tax returns for the last two years. You should also provide bank statements that show the amount of money coming into your account each month.

Credit score: Your credit score is an important factor in determining whether or not you're eligible for a loan as well as how much interest rate you'll pay on it. If you don't have a good enough score, lenders may require additional collateral (such as real estate) before they lend to you at all--or they might just give up on trying altogether!

The Pre-Approval Process

The pre-approval process is a step-by-step process that begins by gathering the necessary documents, and ends with your lender sending you a letter confirming that they are ready to lend you money.

The first step in this process is gathering all of the documents required by your lender. This may include:


A copy of your most recent paycheck stubs (or an estimate if you are self employed)

Your tax returns from last year, including W2s or 1099s for any additional income sources

A list of all debts currently being paid by you or on which you owe money

Things to Consider Before Applying for a Pre-Approval

Before you apply for a pre-approval, it's important to consider the following:


Your credit score. A good credit score will help you secure lower interest rates and better loan terms.

The debt-to-income ratio (DTI). This measures how much money you owe on all debts compared with your monthly income; lenders typically want this number below 43% if possible.

Down payment funds or closing costs that need to be paid at closing time (which can vary depending on your lender).

What to Expect During the Pre-Approval Process

The pre-approval process is a series of steps that you and your lender will go through to determine how much you can afford to borrow. This includes submitting documents, such as proof of income and employment, as well as a credit check. Your lender will also verify that you have sufficient funds for a down payment on the home you want to purchase.

Once all of this information has been provided, your lender will give an estimate of what type of mortgage loan amount they think would be appropriate for your situation--and whether or not they think it's feasible based on their criteria (such as credit score). If everything checks out favorably at this point, then congratulations! You're pre-approved!


Tips for Getting Pre-Approved for a Mortgage in San Diego

Check your credit score. Your lender will want to see that you have a good track record of paying bills on time, so make sure all of your accounts are in good standing.

Save for a down payment and closing costs. You'll need some cash on hand to pay for the down payment and closing costs when it's time to buy, so start saving now--it can take years!

Pay off high-interest debt before applying for a mortgage loan (e.g., credit cards). This will help lower your monthly payments, freeing up more money in your budget for other expenses like food or clothing while also improving your chances of getting approved by lowering overall debt levels in relation to income ratios used by lenders when evaluating applications

Common Mistakes to Avoid When Applying for a Pre-Approval

There are a few common mistakes to avoid when applying for a pre-approval.


Applying with the wrong documents: Make sure you have all of the required documents before you apply. You can find out if your lender requires any specific paperwork by reading their website or calling their customer service line.

Applying without a down payment: If you're planning on buying a home in San Diego, it's important that you have enough money saved up as a down payment on your own--not just through gifts from family members and friends. Your lender will want proof of this in order to approve your loan application, so don't forget!

Not understanding the process: If this is your first time buying property in San Diego (or anywhere), then there's no need for concern--but if not...then maybe consider taking some time off work so that someone else can explain everything clearly enough for everyone involved (including yourself).

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