Let’s talk about mortgage pre-qualification versus pre-approval. What’s the difference?
If you are shopping for a home and you have called a lender and chatted about your income, your debts, and your credit history… The lender was probably able to say, based upon what you’ve told me it looks like you qualify to purchase a home up to $$$$.
That’s a good first step.
Pre-Approval on the other hand take a little longer. Whereas pre-qualification may take 10 minutes, pre-approval may take 5-10 days. You’ll likely provide pay-stubs, or W-2s, verification of employment, debt payments, and your credit report will be pulled.
The end result is a letter from the lender saying this buyer is ready to go, they are pre-approved for a loan. And, believe me, if you get into a situation where you are competing with another buyer for a home, the pre-approved buyer will win every time.
As a policy, before I show homes to a prospective buyer I will want them to be Pre-Qualified and/or Pre-Approved by a Lender. I will want to have a Pre-Approval letter in hand before writing an offer.
Early on in my career I would run out and show a property to anyone who wanted to see it. I wasted my time. I wasted their time.
It can disappointing for a buyer to get their hopes up about buying a home they see only to later discover they can’t get a mortgage for it. Many buyers are overly optimistic about how much home they qualify for.
If you are thinking about buying a home here’s the steps I recommend:
- Meet with me for an initial consultation. Let’s find out if we feel comfortable working together.
- Allow me to introduce you to a Lender who will provide you with excellent service.
- Get Pre-Approved
- Look at homes
- Make an Offer
- Allow me to help you negotiate an executed contract.
- Order inspections and all the contract to closing requirements. I’ll help you.
- Close on the home
- Move in and enjoy!
What’s your real estate dream? Let’s talk about it today. 512-516-4666.
