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When you go shopping for a home, a huge concern is figuring out exactly how much you can afford. To deal with this, mortgage lenders offer preapprovals to help you determine the upper limits of your buying power.

However, the term preapproval can mean different things. It could mean the lender runs your credit and verifies your income and assets. It could also mean they just run your credit and get estimates from you on your wages and savings. These are obviously two very different levels of scrutiny, and the distinction is very important for everyone involved in the home-buying process. Sellers especially want to know that your financing is likely to go through.

To break through the confusion, we’re introducing the Power Buying ProcessTM, which breaks down into three distinct levels of approval. This makes communication clearer and, with the addition of the RateShieldTM Approval, even offers you a distinct advantage in the home-buying process as a Quicken Loans client.

In this post, we’ll walk through the way the Power Buying Process works and how you can gain the most confidence as a home buyer.

Prequalified Approval

In the Prequalified Approval step, Quicken Loans checks your credit. This lets us see your three-digit FICO® Score for basic credit qualification purposes. We also look at your revolving debt, like credit card payments, as well as your installment debt, like car and student loan payments.

We’ll also ask you for verbal estimates of your total income and any assets you want to use toward qualifying for the mortgage. This helps our Home Loan Experts calculate your savings for a down payment and reserves, as well as your debt-to-income (DTI) ratio.

With the Prequalified Approval, because your income and assets aren’t verified, it’s just an estimate and real estate agents as well as sellers may not take this quite as seriously. We recommend that everyone get a Verified Approval.

Verified Approval

A Verified Approval includes a credit pull, as with a Prequalified Approval, but an extra step is taken to verify your income and assets. This gives you the ability to have absolute confidence that you can afford what you’re offering.

We verify these by having you share documents like W-2s, income tax returns, pay stubs and statements for any accounts you want to use as assets. We guarantee we’ll get your verified approval back to you within 24 hours of you sharing your documentation with our underwriting team.*

With a Verified Approval, you should feel the ultimate confidence that you’ll close. In fact, we’re putting our money where our verification is. With a Verified Approval, if you don’t close based on our review, we’ll give you $1,000.**

Knowing beyond a shadow of a doubt that you qualify for a certain amount of funding is a big deal, but it’s not the only concern home buyers have. Interest rates are constantly moving around. If you’re trying to time the market, good luck. Even if you’re savvy enough to know that rates are trending up and you like one you see, you generally can’t lock your rate until you find a house.

RateShield Approval could be the answer.

RateShield Approval†

Available on 30-year conventional, FHA and VA loans, a RateShield Approval comes with the full underwriting backing of a Verified Approval and adds the ability to lock your interest rate for up to 90 days while you shop for that dream home.

It’s a bit of a marketing cliché to say it gets even better, but it gets even better. Let’s say you find a home on Day 85 after receiving your RateShield Approval. If you give us the property address, and rates have dropped between when you started shopping and the current day, we’ll float you down to the current lower rate. If rates have gone up, we just honor your initial locked rate. You can’t lose.

This gives you the ability to protect your monthly payment because your interest rate won’t go up after you initially lock it. Because you’ve been approved for financing, you can also go in with the full confidence of a cash buyer who knows they can make the deal. This is a huge advantage in the competitive housing market we have now.

If you think our Power Buying Process is right for you, you can get started with Rocket Mortgage® by Quicken Loans or go ahead and give one of our Home Loan Experts a call at (800) 785-4788.

*Verified Approval within 24 hours of receipt of all requested documentation.

**Participation in the Verified Approval program is based on an underwriter’s comprehensive analysis of your credit, income, employment status, debt, property, insurance, appraisal and a satisfactory title report/search. If new information materially changes the underwriting decision resulting in a denial of your credit request, if the loan fails to close for a reason outside of Quicken Loans’ control, or if you no longer want to proceed with the loan, your participation in the program will be discontinued. If your eligibility in the program does not change and your mortgage loan does not close, you will receive $1,000. This offer does not apply to new purchase loans submitted to Quicken Loans through a mortgage broker. Additional conditions or exclusions may apply.

†RateShield Approval locks your initial interest rate for up to 90 days on 30-year conventional, FHA and VA fixed-rate purchase loan products. Your exact interest rate will depend on the date you lock your rate. Once you submit your signed purchase agreement, we’ll compare your rate to our published rates for that date and re-lock your interest rate at the lower of the two rates for an additional 40 to 60 days. Additional conditions or exclusions may apply.

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This Post Has 17 Comments

  1. What if i have a low credit score havent filled taxes because of incarcetation but have a 80000 down payment and currently make 4500 a month can i get a loan for 70k

    1. Hi David:

      It depends on how you define a low credit score. What I can tell you is that to get a loan through Quicken Loans, you need a credit score that’s a median of at least 580 between the three credit bureaus. FHA guidelines do permit that you can get a mortgage with a qualifying credit score of as low as 500. However, most lenders don’t do these loans. If they do, you’ll likely pay a higher rate because these are considered subprime. If you’re ready, you can get started online through Rocket Mortgage. You can also give us a call at (888) 980-6716.

  2. Is it possible to apply for a $76,000 home loan with a credit fico score of 711, one year income tax of 34k, self employed? Bank statement available. Is there such a thing anymore as a low doc loan?

    1. Hi Hilda:

      We would love to help you look into your options. The types of documents required are going to depend at least a little bit on the type of loan you apply for. However, good general things to have in your situation are bank statements, tax returns and documentation related to your business financials since your self employed. If you want, you can get started online with Rocket Mortgage or give us a call at (888) 980-6716.

    1. Hi Kim:

      We typically recommend that clients be prepared to give us two years’ of tax returns. There are instances in which we could require more of a history (e.g. self-employment), but that’s a good starting point. If you want to get started, you can do so online with Rocket Mortgage by Quicken Loans or give one of our Home Loan Experts a call at (888) 980-6716.

    1. Hi Agnes:

      We don’t offer grants ourselves at this time, but we take grants from a variety of sources. If you’re a first-time buyer, I think you’ll find that this article will help. In terms of cost, it doesn’t cost anything to apply. If you decide to move forward, you would put down a deposit. The cost on that can vary a bit depending on the loan options you go with. If you would like to look into this online, you can get started through Rocket Mortgage or go ahead and give us a call at (888) 980-6716 to speak with one of our Home Loan Experts. Have a great day!

    1. Hi Keegan:

      In some cases, you can. We would need evidence of the payment plan with the IRS. I recommend speaking with one of our Home Loan Experts at (888) 980-6716. Hope this helps! Have a good day!

  3. My fiance and myself are in the process of looking at lenders to get pre-approved (after first lender pre-approved us separately). My credit score is low whereas his is in 700s. My concern is with my score being low (my debt to income ratio is 0) that this will cause us to be pre-approved for an amount less than what we hope for. We are presently looking at a short sale which is right in our budget. Any pointers is greatly appreciated.

    1. Hi Madison:

      I won’t presume to know how low your credit score is. I’m going to provide some general information. If you both want your income to be used on the loan, you would need a median FICO® credit score of at least 580. However, in order to qualify for that loan you have to have a combined debt-to-income ratio (DTI) that’s on the lower side. You can qualify for higher loan amounts with a median score of 620.

      If you need to get your credit score up, there are a few things we can help you take a look at. First, I’m going to suggest you check out our friends at QLCredit. You’ll get your free VantageScore® 3.0 credit score and report for free every two weeks from TransUnion. The report will also have personalized tips on where you can improve. Secondly, we’ve got some great general credit building information in this blog post. Finally, you can also talk to one of our Home Loan Experts to come up with a game plan to get your credit where it needs to be. You can get in touch with us at (888) 980-6716. I hope this helps!

    1. Hi Dan:

      It may be possible, but I recommend speaking with one of our Home Loan Experts at (888) 980-6716. They would be better able to go over the specifics of your personal situation. Have a great day!

    1. Hi Maria:

      I’m going to recommend you speak with one of our Home Loan Experts at (888) 980-6716. You can usually do this, but the garnishment has to be included in your debt-to-income (DTI) ratio. Hope this helps!

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