The key differences between a pre-approval and a pre-qualification.
You’ve probably heard the terms “pre-approval” and “pre-qualification” used interchangeably among real estate agents and lenders, but they’re two different things. With a pre-qualification, you just need to get on the phone with a mortgage professional, provide basic financial information, and they’ll give you a ballpark estimate of what you qualify for. A pre-approval, however, requires financial documentation. You’ll need to provide bank statements and tax returns to fully underwrite your loan and get a precise number of what you can purchase. At that point, when you present an offer to a potential seller, they know that you’re fully approved, and it will make your offer stronger.
I highly encourage all borrowers to get pre-approved to be in a better position to win a home in this competitive home-buying market. If you have any questions for me about the market or real estate in general, don’t hesitate to reach out via phone or email. I look forward to hearing from you soon.