Finance
A borrower who has been pre-approved for a mortgage has had their:
AIncome, assets, and credit verified by the lender✓ Correct
BProperty appraised by a licensed appraiser
CTitle searched for defects
DHome inspected for defects
Explanation
Pre-approval means the lender has verified the borrower's income, assets, employment, and credit, and committed to lending up to a specified amount, subject to a satisfactory property appraisal.
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Key Terms to Know
Pre-Approval
A lender's conditional commitment to loan a specific amount to a borrower, based on verified income, credit, and assets.
AppraisalA professional estimate of a property's market value prepared by a licensed or certified appraiser.
Debt-to-Income Ratio (DTI)A lender's measure of a borrower's monthly debt obligations relative to their gross monthly income, used to evaluate loan eligibility.
Loan-to-Value Ratio (LTV)The ratio of a mortgage loan amount to the appraised value or purchase price of a property, expressed as a percentage.
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