WITH MORTGAGE preapproval, a lender checks your credit and evaluates details about your income, debts and assets using documents including pay stubs, personal bank statements and your federal personal income tax returns.
The lender uses this information to determine whether you're preapproved and the size of the mortgage you can receive. To reduce risk brought on by the COVID-19 pandemic and economic slowdown, lenders are generally tightening eligibility standards for all borrowers and stepping up the income verification process for self-employed borrowers.
Understanding these changes and doing a little prep work can help when you're ready to ask for preapproval.
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