Salal Credit Union

Home Loan Resources

How to Prepare for Pre-Approval

Pre-approval is an important part of the homebuying process because it provides you with an honest assessment of the current state of your finances. You’ll find out how much house you can actually afford, what your down payment requirements will be and what your future mortgage payments might look like. It’s a smart idea to take this step before you start house hunting.

When you meet with a Salal mortgage advisor for pre-approval, you’ll need to bring the items below:

  • Photocopy of your driver’s license or other state-issued ID
  • If you are not a US citizen, photocopy of your Permanent Resident Alien card or Visa status
  • Residence addresses for the past 2+ calendar years
  • Names and addresses of employers for the past 2+ calendar years
  • One month of most recent pay stubs
  • W2s from the past 2 years
  • Personal tax returns for the past 2 years (all pages/all schedules)
  • If self-employed, business tax returns for the past 2 years (all pages/all schedules), copies of any 1099 and K1 forms, Year-to-Date Profit and Loss Statement and Balance Sheet
  • 2 months of most recent bank, investment and retirement account statements
  • For any properties you currently own, please provide the most recent mortgage statement, property tax statement and homeowner’s insurance declaration page. The most recent HOA Dues statement will be needed if the property is a condominium or in a Planned Unit Development.
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Already Pre-Approved?

If you are already pre-approved for a loan, learn more about the measures to take to help make the loan-closing process run smoothly here.


Common Questions

What are my obligations if I fill out a loan application?
At Salal, there is no cost to submit a loan application or be pre-approved, and you are not obligated to the loan until closing.

Do I have to have perfect credit?
Having a good credit history will certainly increase the likelihood of getting the loan you want, but it’s only one factor in the underwriting process. You can still obtain a mortgage with less than perfect credit.

What is the difference between interest rate and Annual Percentage Rate (APR)?
Think of it this way: a financial institution charges you to borrow money. The interest rate is the cost of borrowing money, expressed as a percentage rate. The APR reflects not only the interest rate, but any other fees required to finance the loan, like points and some closing fees.

What is a discount point?
Discount points are up-front fees paid to the lender at the time of closing in exchange for a reduced mortgage interest rate. This is referred to as “buying down the rate.”

What is an escrow account?
An escrow account is set up to make certain recurring payments on your behalf, like real estate taxes, property insurance, mortgage insurance and/or flood insurance. To make these payments, your lender collects escrow funds as part of your monthly mortgage payment. This is a convenient way to guarantee your bills are paid in full and on time.

How long does it typically take to close a mortgage transaction?
The time to close will vary, depending on your situation. Once you’ve been approved, closing generally occurs within 30-45 days. Shorter closing timeframes can be considered on a case-by-case basis.