The Power of Pre-Approval for Agents
The difference between pre-qualification and pre-approval
There’s a world of difference between a “Pre-Qualification” and a “Pre-Approval.” Help your clients avoid potential disaster by educating them on the difference between the two. The information below is a valuable tool you can use to help guide them on their path to home ownership and encourage them to provide the documentation early in the process.
Pre-Qualitification
This is the initial step in the mortgage process. The client provides the lender with an overall financial picture (including income, assets and debt information). After evaluating this information, the lender can provide an estimate of what the client will qualify for. However, it does not include verification of the information provided. For this reason, a pre-qualified buyer does not carry the same weight as a pre-approved buyer. A prequalification form (PQF) in this stage WILL NOT have boxes 23-26 marked “yes.”
Pre-Approval
Pre-Approval is the next step in the process. The client completes an official loan application and provides the lender with the necessary information to document (and thus verify) income, assets and debts. From this, the lender will confirm the buyer’s ability to obtain financing as well as the specific amount for which they are approved. A pre-qualification form (PQF) in this stage WILL have boxes 23-26 marked “yes.”
Getting a pre-approval early in the process will allow your clients to move quickly once you find them the home of their dreams. In addition, when the offer is made, it won’t be contingent upon applying for a loan, which saves everyone valuable time. Obtaining a preapproval in advance puts your clients in the best negotiating position possible!
Home Buyer Tips
- 2 Myths That May Be Holding You Back From Buying
- 5 Reasons Home Ownership is a Good Financial Investment
- Condo Loans - Low Down Payment
- Do’s and Don’ts During The Loan Process
- FHA 90 Day Property Flip Waiver
- Getting a Mortgage: Why So Much Paperwork?
- How to know if it’s a condo?
- How We Safe Guard Your Information
- Look for a Luxury Home? Now’s The Time To Act!
- Mortgage Insurance
- Niche - Unique Mortgages
- Path 2 Buy
- Ready To Make An Offer? 4 Tips For Success
- Rent vs. Buy
- Rising Rent - No Problem
- Student Loan Debt
- The Mortgage Process
- The Perfect Home Loan Application
- USDA-Wide Open Spaces
- What You Need To Know About VA Loans
Loan Programs
- 3 Reasons Why First-Time Home Buyers Love FHA
- FasTrac Approval Process
- FHA - Home Ownership Opportunities
- FHA “Back-To-Work: Extenuating Circumstances” Program
- FHA 203k Streamline Rehab Loan
- Home Ready Program
- HomeStyle Renovation
- HUD-184 Native American Program
- Jumbo Loans
- Jumbo Plus Loans
- Loan Programs - Pros & Cons
- Reverse Mortgage
- Veterans Assistance Loan Benefits
Homeowner Tips
Tax Information
Credit Information
Financing Information
- Delayed Financing Options
- Discount Points vs Premium Pricing
- Duplex Financing Options
- FICO Scores
- Flipped Property Finance Options
- How Low Interest Rates Increase Your Purchasing Power
- Jumbo - Credit Challenged
- No Lender Fees
- Refinancing
- The Power of Pre-Approval for Agents
- Where Are Interest Rates Headed?
- Why Pre-Approval Should Be Your First Step
Specialty Programs
- Family Opportunity Program
- Fannie Mae - 97% LTV
- FHA - Benefits
- FHA - Credit Requirements
- FHA - Limited Savings
- FHA - Refinance
- HomeScout: Your Unfair Advantage
- Jumbo - Medical Loan Program
- Luxury Home - 2 Million Max
- NHF Platinum - Down Payment Assistance
- Non-Resident Alien Home Loan
- Union Advantage