Home Buying Basics: When You Can Be More Sure That You'll Get The Money

October 28, 2009

Pre Qualification is a nice conversation while Pre Approval is almost like hard currency.

How do I know what price range to look in, and how do I make sure my offer is stronger?

These are two of the most commonly asked questions from first-time and experienced home buyers alike.
One of the best places to start is by getting pre-approved by a lender upfront in the process. Not only does it give you peace of mind knowing your price range is already pre-approved by the lender, but strengthens your position at the negotiating table, especially in a multiple offer situation.

Some lenders offer pre-qualifications and pre-approvals. Here`s the difference:

Pre-Qualification

Provides a ballpark estimate of your buying power.
Is based on summary information you provide on your income and assets.
Requires a satisfactory review of property, financial documents and program requirements to issue final approval.
Is offered by most lenders.

Pre-Approval

Provides proof to real estate agents and sellers you`re pre-approved for a specific loan amount.
Is based on verification of your income, credit and assets (in some cases, verification may not even be necessary).
Requires a satisfactory appraisal and title review. No change in financial condition for final approval.
Is offered by us as a service to you at no cost before you find a home.

A pre-qualification simply means you had a nice conversation and the lender thinks, based on your talk, that you can get a loan. You don't get a pre-approval until the information you provide is more concrete, the numbers work and there's some verification in the mean time: a pre-approval is simply worth more then a pre-qualification.

Maggie Kusmider | iMortgage
Office 480.344.8104 | Cell 602.328.0865
4800 N Scottsdale Rd, Ste. 3800 - Scottsdale, AZ 85251
Mortgage Banker BK 0903725