Answers · The process
Why did my pre-approval amount change?
A pre-approval is a snapshot of your numbers on one day. If anything in the picture moves, the amount moves with it: a new car payment, a change in income, a credit score that shifted, or a property whose taxes and insurance cost more than the estimate. The most common cause is the property itself, because the pre-approval was done before anyone knew which house you would pick.
Written by Andrew Malm, Senior Loan Originator, NMLS# 2663426. Last reviewed .
When I pre-approve someone, I know their income, debts, credit and down payment. I do not yet know the property. Property taxes, homeowners insurance, flood insurance and association dues all land inside the same monthly payment the lender measures against your income. A house with high taxes can cost you buying power even when the price is the same.
The second cause is on your side of the ledger. A new car, a new credit card, a co-signed loan for a family member, a job change. Each of these changes the ratio of your debts to your income, and that ratio is what sets the number.
The third cause is the pre-approval itself. Some are issued from a conversation and a credit pull with no documents reviewed. Those numbers are guesses. When the real documents arrive, the guess gets corrected. That is why I review documents before a letter goes out. The letter should be a floor, not a hope.
What I'd do
- Ask what assumptions your pre-approval was built on, especially for taxes and insurance.
- Before you make an offer, have the lender run the actual property, not an estimate.
- Change nothing about your money between pre-approval and closing. No new credit, no big purchases, no job moves without a call first.
- If the number did change, ask exactly which line moved. There is always a specific answer.
Have a situation that does not fit the article? That is most situations. See your options or text me at 763-373-9360.
One conversation changes the picture.
Seeing your options is free, with no hard credit pull to start.