Pre-Qualified vs. Pre-Approved:  What's the difference? 

While most people use these terms interchangeably, they are very different.  Every buyer should understand this, and what each means.  Pre-qualification is step one in the process, and pre-approval is step two.  A pre-qualification presents the facts, as the potential buyer describes them, however a pre-approval is an in depth review of the ability to purchase a home.   In our marketplace, a pre-qualification is all but required in order to submit an offer.  Sellers are savvy, and don't want to accept an offer from someone who can't perform on the contract.  The pre-qualification, puts a seller's mind at ease, knowing the buyer is serious.  

Why Get Pre-Qualified?

In our marketplace, a pre-qualification is all but required in order to submit an offer.  Sellers are savvy, and don't want to accept an offer from someone who can't perform on the contract.  The pre-qualification provides the buyer with a general amount they can expect to have a loan approved for, enabling the buyer to shop for a home in the right price rage.  While an important step, the pre-qualification, however, doesn't carry as much weight as a pre-approval.  

What is the benefit of Pre-Approval?  

Pre-approval is a definitive word from the bank, stating the lender can move forward.  Pre-approvals are a result of the buyer completing the application and providing the lender with the necessary documentation to validate the income to expense ratio.  The pre-approval also allows the buyer the benefit of time, as the process moves quicker, once the home perfect place is found.  serve as a cash equivalent, providing the buyer with leverage against other offers that may be on the same property.  as the bank has already verified all In our marketplace, a pre-qualification is all but required in order to submit an offer.  Sellers are savvy, and don't want to accept an offer from someone who can't perform on the contract.  The pre-qualification, puts a seller's mind at ease, knowing the buyer is serious.  

 


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