About the blog: Series of quick reads to give you an inside look into the world of residential real estate.
I often get calls from perspective buyers asking “can I setup a showing to see 123 Main Street”
After learning a little bit more about how I can help, I always ask “Have you been in touch with a lender?”
In a strong seller’s market it’s important for buyers to gain any competitive advantage they can. One way is to be Pre Approved instead of Pre Qualified.
So what’s the difference?
Let’s start with the Pre Qualification. Home buyers can contact a lender online or over the phone provide some information about their income, debt and assets and the lender can provide an idea of how big a loan the borrower qualifies for. Important to note here that this is based on data submitted by the borrower and it is not verified.
A Pre Qualification does not include a detailed analysis of a borrowers credit reports or their ability to purchase a home.
In order for a borrower to receive a Pre Approval they have to complete an official mortgage application. Along with this is a credit report and financial background check. Some lenders even charge a fee for a Pre Approval.
When you get Pre Approved, you will know exactly how much house you can afford and have an idea of your interest rate. Being Pre Approved puts you a step ahead of the game.
Your purchase offer will stand out among other buyers in a competitive market when you are Pre Approved. So if you’re thinking about buying a home in the next 3-6 months or even year, the best first step is to contact a lender to get your financial house in order. If you don’t know a lender, contact a local Real Estate Agent for a referral.
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