Many buyers are confused about the difference between pre-qualifying for a loan and getting pre-approved. Most homebuyers should contact a lender BEFORE they start looking for a home to find out how much they can afford to spend. You should have already taken a good look at your personal budget and know how much money is coming in and how much you are spending. Armed with this information you can shop around for a reputable lender with the best loan products and the best rates and terms. As your REALTOR, I can help you find a good fit.
Prequalification is the process lenders use to calculate how much mortgage you can afford based on the unverified information that you give. In the past you could get a loan based on your word only, without document verification. However, that is no longer the case.
A pre-approval, on the other hand, is where you provide all the same information as when you apply for a loan. This pre-approval guarantees that the lender will loan you a certain amount as long as you buy within a specified time period and the house appraises for the amount of money for which you are qualified.
With all of the foreclosures and short sales on the market today, it is necessary to have a pre-approval in hand when you submit an offer. Most sellers will not consider your bid without one.
Armed with the pre-approval we can work together to shop for new homes in St. Augustine with confidence.
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