Why the difference and why does it matter? Pre-Qualifying can be fast but does it really mean you qualify for the loan amount you have been told and what do sellers think? It is nice to get a quick ballpark figure over the phone to get your search started or make sure you have been searching in the right price range. Even though this is nice it can cause several issues. Most of the time the information given over the phone does not give the full picture of your finances and credit. There are so many factors that go into qualifying for a loan that as a consumer you may not give the lender some information you consider small but it could actually make a different in you qualifying for the loan.
Also when submitting an offer and especially competing against multiple offers not all sellers will accept a pre-qualification letter or go with a buyer who has a pre-qualification letter over someone who has a pre-approval letter. If you are committed to purchasing a home going in with your strongest offer and finances in order can make all of the difference.
With Pre-Approvals documents are needed and a credit pull so that the lender can get a full picture of your loan worthiness. Getting a pre-approval does not give you a guarantee that you will receive the loan but it is a great starting place. When presenting an offer with a pre-approval a seller sees that you are committed to buying a home and that a lender has looked at all details not just information you gave over the phone. This is extremely helpful when in a multiple offer situation.
When you decide you are ready to buy your first step should be to find a Realtor who will take care of all of your needs. The next step is to find a lender and get a pre-approval before going out to see any homes.
Having all of your “ducks in a row” can help make the process smoother! If you would like to get started with a preapproval, or have one and are ready to start seeing homes in person, give the Tom Lipinski Team at Keller Williams Lakeside Realty a call today!