Approval versus prequalification

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Prequalification versus Pre-Approval

Prequalification Versus Pre-Approval

When looking for a home it is important to know what you can afford to buy. One of the first steps we recommend going through prior to even looking at homes is talking to a mortgage broker. The broker will either pre-qualify you or pre-approve you. There is a difference and I always recommend getting pre-approved so that there are no surprises when you find your new home.


	Pre-qualify
	You tell the mortgage broker your basic income, asset, and debt information and they can usually pre-qualify you in a matter of minutes for free. Sellers should be very wary of buyers with a prequalification letter because nothing has been verified and no credit check has been done.

	Pre-Approval
	Pre-approval is based on verification of your income, asset, debt and credit information. You actually provide evidence of your financial situation. After giving the broker your information it usually takes several days for the final approval to come back. The upside is that you are assured what you can afford and there will be no surprises. It is also a strong bargaining chip to use if you get into a situation where you are biding on a home with multiple offers. A pre-approval is much stronger than a prequalification.

Get Pre-Approved

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