• Columbus-Hilliard
• Columbus-Westerville
• Lending Rates
• Mortgage Loans
• Equity Loans
• Careers
• Calculators
• Reference Tools

• Training Calendar
• Preparing for the Search
• Loan Pre-Approval
• Types of Mortgage Loans
• Selecting a Realtor
• Previewing the Contract
• Finding the Right Home
• Comparison Checklist
• Making the Offer
• The Mortgage Loan
• Closing the Sale
• Glossary
• Resources

Loan Pre- Approval

A pre-approval can help when you negotiate for the home you want to buy. With a pre-approval, the bank makes a conditional loan commitment based on limited information. You may be able to lock in an interest rate. Once you've signed a purchase contract, final approval is considered based on an appraisal and confirmation of your information.

To prepare for a pre-approval, complete the sheet "How Much Home Can You Afford?" which is included in the Home Buyer's Helper packet. It will help you organize the information we use to establish the debt-to-income ratios that determines the monthly payment most comfortable for you.

After you have completed the form, contact Customer Service & More at 216-529-2700 to set-up an appointment. We'll analyze the information and let you know the results.

Assets
Be prepared to provide complete, itemized information about your assets (savings accounts, CDs, stock certificates, etc.).

Employment
We will need full information about your past and current employment. In some instances, we may want to see pay stubs. If you are self-employed, we will want to see the last three years of the business' income tax returns. We will also require your personal tax return.

Liabilities
Gather specific information about each debt, including the full name and address of each creditor, account numbers, monthly payments, and how soon each debt will be repaid in full. Be prepared to furnish the names and addresses of past creditors as a credit reference.

Down Payment
Another important consideration is your down payment, the amount of your out-of-pocket investment in a property. Your down payment may be a combination of your own funds and gifts from other sources. Lenders require different down payments, usually 5, 10 or 20 percent, but some as low as 0 percent. Down payments of less than 20 percent may require private mortgage insurance (PMI), which can add to your monthly payment. Ask about special No-PMI loan options.

Debt-to-Income Comparisons
The mortgage amount you can afford is based on a comparison of your debts to your income. This is considered in two ways: 1) the percentage of income your loan payment will represent, and 2) the percentage of income your total debt (loan payment plus all other debts) will represent. The maximum percentages allowed vary, but are generally 28 percent for payment-to-income, and 36 percent for debt-to-income. Additional income sources beyond wages, such as child support or alimony payments, may or may not be included, depending on how long they will be paid.