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Pre-Approval vs. Pre-Qualified

Before you begin to shop for a new home, you should call us or fill out our online loan application so we can figure out how much you can afford. This will put you in a better position as a buyer. Home sellers instruct their real estate agents to screen out offers from potentially unqualified buyers, and they often insist that buyers prove that their lenders have pre-approved them for a loan. That's when it is important to understand the distinction between being pre-qualified for a loan and pre-approved for a loan. The difference between the two terms will be crucial when you decide to make an offer on a house.

Mortgage Pre-Qualification

To get pre-qualified, which is a relatively informal indication of your financing potential, we will ask you about your debts, income, and assets. We'll look at your credit profile. We will discuss how much money you have available for a down payment. With this information we can determine which of the available loan programs would work best for you. We will give you a verbal estimate to the question, "how much house can I afford?"

It is important to understand that a pre-qualification is just an estimate of what you are eligible to borrow, not a commitment to lend. We always recommend that you take the extra small step to obtain a formal mortgage pre-approval letter before setting out to find a house. Getting a home loan pre-approval letter gives you competitive advantage when the time comes to bid on a home because you have been formally approved for a loan for a specified amount.

Mortgage Pre-Approval

To get pre-approved, you will complete our mortgage application and provide us with more detailed information about your employment, assets and financial status. After we analyze this information we can issue a mortgage pre-approval letter indicating the amount you are eligible to borrower for your home purchase. This pre-approval will be subject to written verification of your employment, income and assets. It also will be conditioned upon finding a qualifying property.