Pre-Approved VS. Pre-Qualified? Why you should always get pre-approved before house hunting.

When it comes to getting financing to purchase your new home, the first step is crucial. You have 2 options- 1.) Get Pre-Qualified, or 2.) Get Pre-Approved.

Getting PRE-QUALIFIED means a lender has given you an estimated mortgage amount based on a very general look at your finances.

Getting PRE-APPROVED means that you have a COMMITMENT from a lender for a SPECIFIC mortgage amount based on a detailed financial analysis and credit check. Keep reading for a few reasons why this is the way to go.

1.  It Saves Time

Getting pre-approved means you have done the extra work up front to get a clear budget and price range. Shopping online, meeting with one of our Realtors, and negotiating with the seller will be easier and faster.

2.  It Saves Money

During negotiations, the seller may give you a better price knowing that you have a definite source of purchase money since it means a greater chance of escrow closing without any additional financial hurdles to overcome. Fewer contingencies = fewer hassles, quicker escrow, & everyone walking away happy!

3.  Better Chance of Getting The Home

When the seller has multiple offers on a home, as is often the case, if you are pre-approved and the other buyers are only pre-qualified, the seller is more likely to choose your offer. Sellers want a hassle-free escrow just as much as the buyer does, and a pre-approval letter spells “smooth sailing” much better than a pre-qualification. There is nothing worse than losing out on your dream home because another buyer was pre-approved and you weren’t.

Start your house hunt out on the right foot by getting pre-approved with a qualified loan expert. There is more work involved initially, but the efforts will save you time and dollars later in the transaction, and ensure you have the best possible home-buying experience. Need more information? Give us a call anytime @ 951.767.2400. We are here to help!