Which document is essential when a buyer applies for a mortgage?

A pre-approval letter from a lender is an essential document when a buyer applies for a mortgage because it provides a lender's evaluation of the buyer's financial history and creditworthiness. This letter outlines the amount of money the lender is willing to loan based on the buyer's income, credit score, and overall financial situation. Having a pre-approval letter enhances the buyer's position when making an offer on a property, signaling to sellers that the buyer is serious and financially capable of completing the purchase.

While a home inspection report, proof of employment, and a title report are important in the overall home-buying process, they serve different purposes. The home inspection report assesses the property's condition, the proof of employment verifies the buyer's job status and income, and the title report confirms the legal ownership and any liens against the property. However, these documents do not directly influence the initial mortgage application as the pre-approval letter does.