The short answer
Start with where and when you hope to buy, a comfortable monthly housing budget, available cash, income sources and current debts. You do not need to know the loan program in advance. An initial conversation can establish the next steps; a preapproval requires a lender’s review and remains conditional.
What should you know before the first call?
Write down your target area, property type, timeline and an amount you would be comfortable spending each month. Mention whether the home will be your primary residence and whether your income or employment is changing.
Your comfort level and a lender’s maximum approval are different questions. Include room for the rest of your life: savings, childcare, transportation and irregular expenses. A first conversation is useful even if you are months away from making an offer.
What belongs in the monthly housing budget?
The loan’s principal-and-interest payment is one part. Add property taxes, homeowners insurance, any mortgage insurance and association dues, plus money for maintenance and utilities. Some amounts are collected with the mortgage payment; others are paid separately.
The CFPB’s Loan Estimate explainer shows where estimated payments, taxes, insurance and cash to close appear. When comparing offers, use the same purchase price and down payment, and check what each payment includes.
How is cash to close different from the down payment?
Suppose a hypothetical $500,000 purchase uses a 5% down payment. That is $25,000. Assume another $12,000 in closing costs, prepaid items and initial escrow funding, with no credits. The combined amount is $37,000 before accounting for deposits already paid.
If a $5,000 earnest-money deposit is credited toward closing, the remaining cash in this simplified example is $32,000.
The deposit is part of the money you have already contributed, not an additional down payment. Keep moving costs, repairs and savings after closing in your plan too. Any lender-required reserves are a separate question.
Illustrative amounts only. This is not a quote, minimum down-payment requirement or estimate of actual closing costs. Your Loan Estimate and Closing Disclosure account for the transaction’s specific credits and adjustments.
Which documents are useful to have ready?
- Recent pay information and relevant income history.
- Bank and investment statements showing available funds.
- Current debt payments, including student loans and other property loans.
- Tax returns and business information if self-employed.
- A record of gifts or unusual deposits that may fund the purchase.
This is a starting list; the lender determines what your file needs. The CFPB’s application-packet checklist provides a fuller preparation guide. A Loan Estimate does not require submitting all supporting documents first.
For the initial call, a summary is enough to begin. Ask for a secure document channel before sending statements, account details or identification.
Does preapproval mean the loan is guaranteed?
No. A preapproval indicates a lender’s conditional willingness to lend based on its review. Lenders use the terms prequalification and preapproval differently, so ask what was checked, what remains outstanding and when the letter expires.
The property, appraisal, updated finances and final conditions can still affect the outcome. Keep the lender informed about changes before closing.
Leave the first conversation knowing the next document request, an affordable range to investigate and the next step toward a useful preapproval—not simply the largest price on a letter.
Sources & context
Prepared for Meet Shawn Way using the sources below. Examples are original educational illustrations. Source information checked September 7, 2026; guidelines and availability can change.
