December 2, 2021

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FHA Home Loan Pre-Approval: Issues To Consider

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Getting mortgage pre-approval is an important step in the home buyer journey.

It indicates to the seller and to a lender that you are serious about your home loan and that you are ready to commit to the right property and the right price.

So what should you know about mortgage pre-approval before you apply? There are some basic questions to ask yourself before you start filling out the forms to get pre-approved.

Getting pre-approved for an FHA home loan means asking yourself how good your credit score is and how high your credit card balances are.

It’s best to start asking these questions far in advance of your home loan so that you have ample time to work on your credit issues where they might exist, and also so you have enough time to save money for closing costs, your down payment, etc.

There are several areas you should ask about when planning your home loan. Investopedia, in its description of home loan pre-approval and associated issues, names the following as areas consumers need to address a year or more ahead of your pre-approval paperwork:

  • Credit history
  • Credit score
  • Debt-to-income ratio
  • Employment history
  • Income
  • Assets and liabilities

Credit history is a big one in terms of starting early–you want at least 12 months of on-time, every time payments on your financial obligations before seeking a major line of credit like a home loan.

Your credit score is affected by your payment history, so starting on that plan as early as possible means you will be actively improving credit scores over time.

The debt-to-income ratio is also critical–try to reduce your credit card balances to well below 50% with a goal of getting as close to 30% of your card limit on each account. This also actively helps improve your credit scores over time.

Employment history is not just key for those new to the job market; lenders also look at the nature of your employment (contract, salary, freelance, etc.) and how long you have been earning a certain TYPE of income (commission income, for example). 

If you switched to a different work model or switched income types (salary to commission, for example) you will want to have more than a year (more than two is better depending on the lender) on the books before you apply.

Learn About the Path to Homeownership
Take the guesswork out of buying and owning a home. Once you know where you want to go, we’ll get you there in 9 steps.

Step 1: How Much Can You Afford?
Step 2: Know Your Homebuyer Rights
Step 3: Basic Mortgage Terminology
Step 4: Shopping for a Mortgage
Step 5: Shopping for Your Home
Step 6: Making an Offer to the Seller
Step 7: Getting a Home Inspection
Step 8: Homeowner’s Insurance
Step 9: What to Expect at Closing

Joe Wallace - Staff Writer

By Joe Wallace

September 8, 2021

Joe Wallace has been specializing in military and personal finance topics since 1995. His work has appeared on Air Force Television News, The Pentagon Channel, ABC and a variety of print and online publications. He is a 13-year Air Force veteran and a member of the Air Force Public Affairs Alumni Association. He was Managing editor for for (8) years and is currently the Associate Editor for

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About was launched in 2010 by seasoned mortgage professionals wanting to educate homebuyers about the guidelines for FHA insured mortgage loans. Popular FHA topics include credit requirements, FHA loan limits, mortgage insurance premiums, closing costs and many more. The authors have written thousands of blogs specific to FHA mortgages and the site has substantially increased readership over the years and has become known for its “FHA News and Views”.

5850 San Felipe Suite #500, Houston, TX 77057 281-398-6111. is privately funded and is not a government agency.

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