Pre-approved or pre-qualified?

Have you ever wondered what the difference was between pre-qualification and pre-approval? Let us help you navigate these terms as you prepare to begin the home financing process.

First up is pre-qualification, the very first step you should take in your home buying journey:

• This is a “numbers review” only – you will provide information on your financial standing, including income, debts, savings and credit history.
• No validation needed at this stage – this step does not require documentation such as W2s and bank statements.
• An estimate will be made on how large of a mortgage you can afford.

So what makes pre-qualification different from pre-approval?

• After being pre-qualified, the next step is to get pre-approved for a mortgage.
• Why get a pre-approval? Pre-approvals provide more accurate information regarding potential home loan costs.
• Also, a pre-approval consists of a fully underwritten review of your income, assets, and credit to determine what you qualify for, conditional only on property-related items.

Now that you have an idea of the differences between pre-qualification and pre-approval, you can reach out to our preferred lender, Jeremy Boillot with Barrett Financial.

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April M Anderson , REALTOR