The Difference Between Pre-qualified and Pre-approved

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The Difference Between Pre-qualified and Pre-approved

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Mortgage Basics: The Difference Between Pre-qualified and Pre-approved

What’s the difference between being prequalified and preapproved?

While you go about finding a home to buy, you also need to take the time to understand the mortgage and the mortgage process. In this context, it will be necessary for you to understand some of the basics of a home mortgage. Two general terms that you will face when it comes to a home mortgage and the mortgage application and approval process are pre-qualified and pre-approved.

Through this article, you will get some of the basics of home mortgage, especially about the difference between pre-qualified and approved for a mortgage. Once you have taken this information into account, you will be able to apply for the mortgage you need and want.

Pre-qualified

When it comes to a mortgage loan, pre-qualified means that you have undergone all the necessary screening requirements associated with a home mortgage loan. While you have not received approval for a particular mortgage or mortgage loan in a certain amount, you have pre-qualified to the extent that a lending institution has indicated that it will finance your purchase of a home within a reasonably broad defined price range.

You still need to be approved for a particular home mortgage loan if you have been pre-qualified for a mortgage loan. In other words, you need to find the house that you want to buy, after which you can complete the mortgage application and house mortgage approval process.

Pre-approved

If you are pre-approved for a home mortgage loan, you have in fact been approved for a home mortgage loan in a certain amount. By pre-approving a home mortgage loan, you will know what funds you have available when you are traveling and looking for a house.

Sellers and real estate agents look very positively on a person who has been approved in advance for a mortgage. Sellers and estate agents recognize that if a buyer has been approved in advance for a home mortgage loan, there will be no halt in the process of closing on a home sale while the buyer waits for credit approval. The buyer comes to the deal with an already existing home mortgage loan.

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