Buyer guide
Getting pre-approved
A pre-approval is a letter from a lender you choose. The lender has looked at your income, your savings, and your credit, and has said what you may be able to borrow. It is a strong start. It is not the loan.
In this guide
The letter, in plain words
A pre-qualification is usually a conversation. You tell the lender about your income and your debts. The lender gives a range. A pre-approval goes further. You provide documents. The lender checks them and writes a letter.
Ask the lender which one you have. For an offer in Park City, Deer Valley, or the Wasatch Back, the useful paper is the pre-approval. Bring it when you write. Sellers often want to see that a lender has already looked at you.
What the letter is not
The letter is not a promise that the loan will fund. The house still has to appraise if the contract requires an appraisal. The title still has to be acceptable. Your job, your savings, and your credit still have to look the same when the lender does the final review. That review is called underwriting.
A rate on a letter is not a locked rate. A rate lock is a separate agreement, later, with its own end date. Ask the lender when a lock starts and what happens if closing moves.
Many homes in this area are priced above the limit of a standard conforming loan. The lender may use a larger loan program. Ask which program the letter is based on. This page does not name lenders and does not quote a rate.
A second home is a different file
Lenders sort houses by how you will use them. A primary home, a second home, and a rental are not the same application. A ski house you use yourself is often treated as a second home. A house you rent for most of the year may be treated as an investment.
The down payment, the reserves, and the rental rules can all change with that label. Ask the lender which box this house falls in, and what that program requires. Do not assume the rules from a primary-home loan will carry over.
Questions worth asking the lender
Ask what documents they still need. Ask how long the letter lasts. Ask what would make them change the amount. Ask whether the payment they describe includes only principal and interest, or also the amounts they will collect for insurance and other bills.
The estimate below is principal and interest only. You type every number. Association dues in these communities are a separate bill. They are not in the figure.
Estimate
Payment estimate
Type your own price, down payment, and rate. These boxes are not a quote, and they are not today’s rate.
Enter a purchase price, a down payment, and a rate.
Estimated monthly principal and interest.
Estimate only. This figure is principal and interest. It leaves out HOA dues, insurance, and other costs. It is not a loan quote.
Questions, answered
Is a pre-approval the same as a final loan?
No. A pre-approval means a lender has reviewed your income, savings, and credit and written a letter. The loan is still subject to the house, the appraisal when one is required, the title, and the lender’s final review.
Do I need a pre-approval to make an offer?
The law does not require one. In Park City, Deer Valley, and the Wasatch Back, sellers often expect a pre-approval letter with an offer when the buyer is using a loan. A cash offer uses proof of funds instead.
Does a ski home change the loan?
It can. Lenders treat a primary home, a second home, and a rental differently. Ask the lender which category this house is, and what down payment and reserves that program asks for.
What does the payment estimate leave out?
It is principal and interest only, using numbers you type. It leaves out HOA dues, insurance, and other costs. It is an estimate, not a loan quote, and it is not a rate from a lender.
Places and the market
Write the group when you want to talk through a house in Park City, Deer Valley, or the Wasatch Back.