Are you pre-qualified or pre-approved for a loan?

Before you begin to shop for a new home, you should set up a time to meet with one of our mortgage consultants so we look at your options and figure out how much you can afford. This will put you in a better position as a buyer. It is important to understand the distinction between being pre-qualified for a loan and pre-approved for a loan.  The difference between the two terms will be crucial when you decide to make an offer on a house.

To get pre-qualified for a loan, we will collect information about your debt, income, and assets. We’ll look at your credit profile and assess goals for a down payment and get an idea of different loan programs that would work for you. We will issue you a pre-qualification letter indicating the amount you are pre-qualified to borrow.

It is important to understand that a pre-qualification letter is just an estimate of what you are eligible to borrow, not a commitment to lend. Getting pre-approved for a loan gives you competitive advantage when the time comes to bid on a home because you have been approved for a loan for a specified amount.  Being pre-approved is like walking into a sellers house with a suitcase full of cash ready to make the deal! 

To get pre-approved, you will complete a mortgage application and provide us with various information verifying your employment, assets and financial status such as W-2 forms, bank records and credit card statements. We’ll review your mortgage options and submit your application to the lender that best meets your needs. Once the application process is complete you will receive a pre-approval letter indicating the amount your lender is willing to lend you for your home.