As professionals, we understand how being pre-qualified and being pre-approved can be confusing. Let us help clarify the difference so you can be best positioned for a new home. If you're in a hurry, we've provided a simple table for a quick overview...
New/First-time homebuyers looking to obtain a mortgage can inquire with us (or any other mortgage professional). We will then discuss your goals and current finances (estimated income, assets, credit score, debt) to determine your situation. Based on these estimates, we suggest how to move forward - whether it's a list of programs you can potentially qualify for and/or steps on how to be better prepared in the near future.
Pre-approval is the natural next step to pre-qualification. You can skip getting pre-qualified - if you're confident with your financial situation - but you can't skip getting pre-approved if you're looking for a mortgage.
When you're ready to move forward, you can submit an official mortgage application. Part of the pre-approval process is an extensive credit and financial background check - which is why presenting a pre-approved loan letter is taken much more seriously than a pre-qualified one that's based on estimates.
This process will reflect a hard-inquiry on your credit report. But being pre-approved allows you to be more confident... you receive a definitive amount, interest rate, and a commitment letter you can provide when making an offer on the right home.
If you have any questions not covered in this post, please let us know! We're always looking to improve our content and we can't do that without your feedback. When you're ready to get either pre-qualified or pre-approved, contact us. We enjoy the process and are only here to help.
Unfortunately, yes. The CFPB (Consumer Financial Protection Bureau) posted an article not too long ago about proposed changes...
In our 2nd success story, we helped a Veteran turn equity into cash... which he used to fulfill his dream purchase: a plane engine!