The other day I was working with my realtor & she asked me, "So are my clients pre-approved yet?"  I told her no, they are pre-qualified & I'm waiting for their documents to get them pre-approved with my lender.  And I started thinking to myself then, why am I working my butt off getting real pre-approvals? Why do I find myself over & over & over again explaining the difference between pre-approval & pre-qualification?  Why? Why? Why?

 

I mean think about it.  When I worked for Countrywide, no knock on Countrywide or the branch I worked for, but I didn't see not one person actually go over the underwriter & ask for a real preapproval.  When I worked at the small broker shops, I NEVER saw anyone actually submit the deal to the lender before they had a contract.  But everyone was told they were preapproved. 

When it comes down to it, it is an unfair advantage if you are saying the deal is pre-approved when it really isn't.  I mean let's face it, there are certain clients that are slam dunks.  You the guy I'm talking about.  The one with 800 credit scores, 50% down, on the job for 10 - 15 years & has no debt.  But how about the rest of them?  It takes considerably more time to get them pre-approved. 

Well I'll continue to do it & continue to explain because you know what?  I'll always have repeat business.  I will ask something from every realtor who reads this post though.  Please ask  demand that your lender be honest & tell your clients the difference. In the long run it will help all of us to continue to have smooth on time closings! 

 
Posted by Joe Gonzalez on 07/21/2008 05:16 PM   Comments (7)   ,  
Post is included in group: Online Marketing - Tips, Advice, Wisdom
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7 Comments on Does Your Lender Actually Get Preapprovals?!

Absolutely you should know the difference between pre qual and pre approved.  I like my clients to be talking with the lender right out of the gate.  Especially when gas is so expensive and a lot of the time I feel like a glorified tour guide.

07/21/2008 05:27 PM by Kim Kelley (Coldwell Banker Sky Ridge Realty)

Joe - Great post, good to see you taking the gloves off and telling it how it is.  Good advice, from an honest lender.

Stan Barsch

07/21/2008 05:28 PM by Stanley Barsch, REALTOR® (Long & Foster Realtors)

It is amazing that people don't know the difference.  Especially in this market

07/21/2008 05:33 PM by Krista Bolf Ashland Agent, Ashland Real Estate & Medford Real Estate (Coldwell Banker Pro West)

I'd be happy with a lender that would provide HUD approval more than 10 mintes before the closing. :^)

07/21/2008 05:33 PM by Rob Robinson- Lehigh Valley PA (Bertrum Settlements (Title & Abstract))

I completely agree that everyone involved in the transaction should know the difference between pre-qualified and pre-approved.  You are doing the right thing by getting pre-approvals as quickly as possible.  You will just have to educate everyone why it takes longer.

07/22/2008 01:45 AM by Troy Erickson (Terra Solis Realty, LLC)

Agree as well... is some of the biggest confusion out there.  Then of course other mortgage people and realtors have different opinions of the difference as well which adds to the confusion.

What I have seen recently is that the buyers out there are well qualified.  I have not had a deal blow up due to financing this year except for one - where the appraisal came in low which had nothing to do with the buyer.  (on a side note, that appraisal should have came in - was a disgrace).

Great post !

Chris Somers  www.thesomersteam.com

07/22/2008 04:41 PM by Christopher and Stephanie Somers - Realtors - Philadelphia Real Estate (RE/MAX Affiliates)

Thanks for the comments to all.  Chris, I have had some good but my fair share of challenging deals.  As such we need to do the work to make sure these guys are okay. Plus we don't want to just throw away the clients that aren't perfect.  I mean we could do that & you know it would make more sense some days but everyone deserves a shot at getting a home.  Especially those who are working hard & doing what's right but just fell into rough times.  We'll keep on plugging away one client at a time.

07/23/2008 12:06 PM by Joe Gonzalez - 1st Metropolitan Mortgage

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Mortgage Company: Joe Gonzalez - 1st Metropolitan Mortgage
Joe Gonzalez
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