Pre-Approval vs Pre-Qualification Explained

Pre-Approval vs Pre-Qualification Explained

Pre-Approval vs Pre-Qualification Explained

Pre Approval Vs Pre Qualification

Pre-Approval vs Pre-Qualification Explained

Thanks for clicking in to check out our tips for surviving the home buying process. We at the Cunard Team are NOT mortgage professionals.
You should always, always work with and listen to your trusted mortgage professional during the home buying process.

In Pre-Approval vs Pre-Qualification Explained we’re going to discuss differences between mortgage pre-approval and pre-qualifications. Pre-qualifying for a mortgage is based solely on what you disclose to your loan officer or broker about your income, credit score, and total assets including what is available for down payment. In other words, you’re thinking of buying a home and you call your lender and you tell them something like, “H, I make
$200,000 a year. I’ve been in my job for seven years. I have a seven hundred plus credit score and I’ve got 20% to put down”. However, your lender never verifies this information. They assume that the information you provided is accurate and they would then issue you a pre-qualification based on these claims alone.

A pre-approval usually starts with the same kind of conversation. “Hi, Mr./Mrs. mortgage banker, I make $200,000 a year etc”. Only in this instance, the lender requires the borrower to provide documentation to substantiate these claims regarding income and assets. Then, your lender will run your credit report and you’ll be expected to submit almost all the supporting documents required for review.

After reviewing your credit and documentation, if all checks out, your lender will then issue you a pre-approval letter which should include the amount you’re qualified to borrow as well as your loan officers contact information. Usually details about the loan type and interest rate will not be included. Instead, those are filed when you are ready to receive a loan. As real estate agents in New York City we never submit an offer for a buyer or accept an
offer for one of our sellers with only a pre-qualification. Because we know that the information provided for pre-qualification hasn’t been verified. If you’re thinking of purchasing a home take the time to get pre-approved. It’s extra work but it will pay off in the end when your offer is accepted for that home you always dreamed of. If you’re thinking of purchasing a home or have questions about the process connect with us. We would love to hear from you and we’re happy to help. Thanks for reading Pre-Approval vs Pre-Qualification Explained. Keep an eye on our blog/YouTube page for more great information.

 

 

 

 

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