DENVER HOME BUYER’S GUIDE · STEP 3 OF 10
Getting pre-approved for a mortgage in Colorado
Loan programs compared side by side, what income lenders count and the documents to gather before you apply.
Compare loan programsPre-approved is not the same as pre-qualified
A pre-qualification is a lender’s estimate based on what you tell them. A pre-approval means the lender has actually reviewed your income, assets, debts and credit report and approved you for a specific loan amount. Denver sellers and listing agents know the difference. Many won’t allow a showing without a pre-approval letter or proof of funds, and an offer without one rarely gets taken seriously.
Get pre-approved before you start touring, not after you find the house. It tells you your real budget, and it lets us move the same day the right home comes up. I’m not a lender, but I can introduce you to local lenders I trust, and here’s my advice on how to choose a mortgage lender in Denver.
Mortgage loan programs compared
A quick orientation before you talk to a lender. Tap what describes you to narrow the list. Credit scores shown are what many lenders look for, and each lender sets its own requirements. Your lender will tell you which program actually fits.
VA
Eligible veterans, active-duty service members, many Reserve and National Guard members, and some surviving spouses
- Minimum down
- None
- Upfront fee
- VA funding fee of 2.15% on first use or 3.3% after that with nothing down, lower with 5% or 10% down. Many disabled veterans are exempt. Can be financed.
- Mortgage insurance
- None
- Credit most lenders want
- No VA minimum. Often 580 to 620.
USDA
Buyers under the income limit, purchasing in a USDA-eligible area. Parts of the outer metro qualify.
- Minimum down
- None
- Upfront fee
- 1% guarantee fee, can be financed
- Mortgage insurance
- 0.35% a year, for the life of the loan
- Credit most lenders want
- Often 640 for streamlined approval
FHA
Anyone who meets the credit and income guidelines, buying a primary residence
- Minimum down
- 3.5% with a 580+ score. 10% with 500 to 579.
- Upfront fee
- 1.75% of the loan, can be financed
- Mortgage insurance
- Usually 0.55% a year. Lasts the life of the loan with less than 10% down.
- Credit most lenders want
- 580, many lenders 600 to 640
FHA 203(k)
FHA borrowers buying a home that needs work, with the renovation rolled into one loan
- Minimum down
- 3.5% of the purchase plus renovation cost
- Upfront fee
- 1.75% of the loan, can be financed
- Mortgage insurance
- Same as FHA
- Credit most lenders want
- Often 620 to 640
Conventional 97
First-time buyers, meaning you haven’t owned a home in the last three years. Some 3%-down programs use income limits instead.
- Minimum down
- 3%
- Upfront fee
- None
- Mortgage insurance
- Yes (PMI). Can be removed once you reach 20% equity.
- Credit most lenders want
- Usually 620+
Conventional
Anyone who meets the lender’s credit, income and debt guidelines
- Minimum down
- 5% is common
- Upfront fee
- None
- Mortgage insurance
- Only with less than 20% down, and removable at 20% equity
- Credit most lenders want
- Usually 620+
Program rules and fees change. Sources: U.S. Department of Veterans Affairs, USDA Rural Development, HUD. Your lender has the final word on your eligibility. Last reviewed September 2026.
Looking for something less common? I wrote about three lesser-known mortgage options worth considering.
What income counts
Usually counts
- W-2 salary and wages
- Part-time and second jobs
- Overtime and bonuses with a consistent history
- Seasonal work
- Self-employment income, typically with two years of tax returns
- Alimony and child support, with documentation
Usually doesn’t
- Lottery or gambling winnings
- Unemployment pay, in most cases
- A one-time bonus
- Any income you can’t document
Documents to gather before you apply
Having these ready makes the pre-approval go faster. Your lender may ask for more depending on your situation.
- W-2s from the past two years
- Pay stubs covering the most recent month
- Bank and investment statements from the past two months, every page
- Federal tax returns from the past two years
- A list of your debts and assets
- Your divorce decree, if it applies
- Documentation for any other income you want counted
One more thing: large deposits that aren’t your paycheck will need a paper trail. If family is helping with your down payment, tell your lender early. Most programs require a gift letter.
Frequently asked questions
How long does a mortgage pre-approval last?
Many lenders issue letters good for 60 to 90 days, though your credit report and documents may need to be updated sooner. If your search takes longer, your lender will refresh it.
Does getting pre-approved hurt my credit?
A mortgage credit check can lower your score slightly. Credit scoring models generally treat several mortgage inquiries within a short window as a single inquiry, so comparing a few lenders in the same couple of weeks is fine.
Should I use the builder’s preferred lender for new construction?
Sometimes. Builders often tie their best incentives, such as a rate buydown, to their own lender. Compare that offer against an outside lender’s full cost before you commit. My new construction guide covers how to compare them.
Get my local lender recommendations
Your lender is the right person to run your numbers and tell you which loan fits. I work with a few local lenders I trust to communicate well and close on time, and each one has different strengths. Tell me a little about your situation and I’ll send you the names that fit.
General information, not lending advice. Loan programs, fees and eligibility rules change and vary by lender. Last reviewed September 2026.