What comes first? The chicken or the egg? Actually, to be more specific, the FHA loan or the home?

Question

Do I find the home I'm looking for, and then apply for the FHA loan? Or do I apply for a loan to see how much I qualify for, and then go and find a house in that range?

Answer 1

Favorite Answer

Call a mortgage lender to get pre-approved (free), then find the home.

Source(s): Mortgage lender 32 years.

Answer 2

Any given egg came from a chicken. Any given chicken came from a DIFFERENT egg. Not that difficult.

Answer 3

You can go either way, pre-approval just gives you a better idea of your budget but its not definitive or guaranteed.

And to answer the initial question, the egg came first...laid by an animal that was not quite a chicken. That's how evolution works...

Answer 4

Find a mortgage broker that specializes in FHA. Go to a local, independent broker. Get a pre-approval letter.

Be aware the sellers don't have to accept FHA. The FHA inspection process can be difficult.

Answer 5

You find a home and then apply for the loan. The application is for a specific home. But talk to the bank first and ask to be preapproved which will tell you the amount you can borrow.

Answer 6

Get pre-approved before you shop. Then you shop. Once buyer and seller sign the contract, then you go back to the lender and apply for the actual loan.

You CANNOT get loan approval until a home has been chosen, a contract has been signed and a whole other series of steps are taken such as appraisal, inspection and insurance binder.

Answer 7

pre-qualify, shop, apply

Answer 8

The most common scenario is to get pre-approved for the loan which gives you an approximate amount you can be approved for (a pre-approval is not binding). Once you have the pre-approval in hand, you start looking for houses in the range of the pre-approval plus down down payment (if you are pre-approved for $100,000 and have $10,000 for a down payment, you look for houses no more than $110,000 plus offer markdown [if a house is on the market for $112,000 you offer $110,000 which puts you in the correct financial range - just don't offer $110,000 on a house selling for $150,000]).

Once you have your pre-approval giving you your range and once an offer in that range is accepted, the lender will do the legwork on getting the mortgage approved - however, remember that the pre-approval is only a ballpark figure for what you can borrow In our example above, even though you are pre-approved for $100,000 you might only be formally approved for $98,000 or you might get $105,000).