Pre-Qualification and Pre-Approval
Many homebuyers apply for a loan and are either pre-qualified or pre-approved before they find the home they want to buy. Have you ever wondered what the differences are between pre-qualification and pre-approval and what the benefits of each are? Pre-qualification is a simple process. The buyer is asked specific questions about their income, assets, and liabilities. Based on this information, they are provided with an amount for which they may qualify. This process can be done strictly on a verbal level. Pre-qualifying will help you in the following ways:
1. Generally, interest rates are locked in for a set period of time. You will know in advance exactly what your payments will be on offers you choose to make.
2. You won’t waste time considering homes you cannot afford.
Pre-approval, on the other hand, is a much more involved process. But the extra worth is worth it, because a pre-approved buyer is one who is actually approved for a loan of a certain amount. The borrower will provide proof of income, assets, and liabilities, and
this information will be verified by the lender. Because of this verification, pre-approved
buyers are much more attractive to sellers than pre-qualified buyers.
Pre-approval will help you in the following ways:
1. A seller may choose to make concessions if they know that your financing is
secured. You are like a cash buyer, and this may make your offer more
competitive.
2. You can select the best loan package without being under pressure.
To get a pre-qualification letter or to be pre-approved, or just to learn more about either process.
contact me today at 803-319-2703. Visit here to search for your next Home