Did you know that a Pre-Qualification is different from a Pre-Approval Letter?
It can end up costing you thousands of dollars if you truly aren’t qualified.
A prequalification is NOT a true approval. It is the initial step in the loan process where you discuss your financial situation with the lender. But nothing is verified. The preapproval is where you actually provide the lender with all of the necessary documentation and completes the loan application. During this time, the lender will ask for past taxes, bank statements, verify your employment, and other financial documents.
It is crucial for you to get these documents over to lender in a timely matter. Once you have a preapproval, the lender can tell you what your loan amount and monthly mortgage payment will be. Remember,just because you are approved for a certain amount, does not mean you have to buy at your maximum loan amount. You want to be comfortable with your monthly payments.
If you start shopping without a preapproval, you could miss out on making offers or go into escrow and have to cancel because your loan is denied. That could potentially cost you your earnest deposit and any money that you’ve spent on things like inspections or the appraisal.
Don’t skip this step.
If you are ready to start your buying or selling process
give me a call. I'm happy to answer all your questions.