Home > Uncategorized > What is the difference between Pre-qualifying and Pre-approval?

What is the difference between Pre-qualifying and Pre-approval?

December 17, 2009 Leave a comment Go to comments

Pre-qualification is an informal way to see how much you maybe able to borrow. You can be ‘pre-qualified’ over the phone with no paperwork by telling a lender your income, your long-term debts, and how large a down payment you can afford. Without any obligation, this helps you arrive at a ballpark figure of the amount you may have available to spend on a house.

Pre-approval is a lender’s actual commitment to lend to you. The lender will need your financial records and will order a report on your credit history. Pre-approval gives you a definite idea of what you can afford and shows sellers that you are serious about buying.

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