What's The Difference Between Pre-Approval vs Pre-Qualification?

By
Real Estate Agent with The Rockel Group 244520
https://activerain.com/droplet/RWk

What’s the difference between Pre-Approval and Pre-Qualification? I get asked that all the time by buyers who are interested in buying their first home. Sometime even experienced buyers will ask this question. I explain this as the first step to buying a home. I have my clients call and/or meet with one of my prefered lenders to get the process started. I recommend doing this before getting into a car and driving all over the place to look at homes, that they might fall in love with and not be able to qualify for. That can be very upsetting and once a buyer falls in love with a home and told that home is out of their price range, it’s hard for buyer’s to see other homes the same. Plus getting pre-approved or pre-qualified can help make sure nothing shows up on the credit report that can surprise you. It also gives the prospective buyer a chance to work on credit issue, should something come up.  Having that peace of mind knowing what price range and payment you are comfortable with is reassuring.
Difference between Pre-Approval and Pre-Qualification

Pre-Qualification is the basic step when you provide information verbally (verbal application) over the phone or fill out information on the internet. It gives the loan officer an overall financial picture based on the conversation and answers you provided to their questions. It’s also a quick look at your credit report. They will ask you questions about your income, assets, debts and other potential down payment amounts depending on the type of loan you are applying for.This step will give you a ballpark answer on what you could potential be approved up to, as well as an estimated payment.

Pre-Approval provides proof to a real estate agent and the seller that you are actually approved for a specific loan amount and the bank has verified your income, credit and assets. This step is where they gather and see the documents to support the conversation you had earlier, where they took your initial information.They can also lock you in on an interest rate after you have an accepted contract,  so you will know exactly what your monthly payment will be. Peace of mind.
Difference between Pre-Approval and Pre-Qualification

I work with two amazing loan officers from different local companies that have helped my client and my clients have given them  awesome reviews.
Nicki Torres  & Kim Evers. So if you are wanting to find out if you can get pre-approved or pre-qualified, click on their names above. Make sure to tell them Katrina recommended them :) Don’t worry, I don’t get paid to recommend them, I just like knowing my clients are taking care of from the beginning! I hope this helps you understand the difference between Pre-Approval and Pre-Qualification.

Buying a home can be very stressful and confusing and knowing your finances are taking care of can make the process run smoother and more fun. If you would like to talk about buying your first home or looking at buying another home call, text 910-583-3817, email me or visit my website to get the process started. I am here to help make this process fun!

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Re-Blogged 1 time:

Re-Blogged By Re-Blogged At
  1. Debbie Reynolds 03/11/2013 11:08 AM
Topic:
ActiveRain Community
Location:
North Carolina Cumberland County Fayetteville
Groups:
Active Rain Newbies
Bananatude
Introducing Newbies in Active Rain
New AR Blogger Seeking Comments on Blogs
Tags:
first time home buyer
va loan
what is the difference between preapproval and prequalification

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Rainmaker
2,346,102
Roger D. Mucci
Shaken...with a Twist 216.633.2092 - Euclid, OH
Lets shake things up at your home today!

Wonderful, detailed information about the difference between Pre-Approval vs. Pre-Qualification Katrina.  Also a great shout out for the two loan officers that you recommend.  Well worthy of being Featured in the Group.

Mar 11, 2013 08:26 AM #1
Ambassador
336,615
Melissa McKinney
McKinney Realty Group - Fayetteville, NC
Realtor, www.LivingFayetteville.com

Katrina~ Great detail for the consumer to understand the process better!

 

Mar 11, 2013 09:08 AM #2
Rainer
368,465
Erin Bates
CMG Financial and Expansion Marketing Services - Aurora, CO

Katrina - awesome post. very detailed and easy to understand. Great tool for the consumer!

Mar 11, 2013 09:51 AM #3
Rainmaker
78,134
Shawna Green
Keller Williams Realty-Fayetteville - Fayetteville, NC
The key to your real estate needs!

Katrina, that was explained very well!  Love it that you explained why its so important!

Mar 11, 2013 10:24 AM #4
Rainmaker
50,601
Katrina Rockel
The Rockel Group - Fayetteville, NC
Thanks Roger, I was wondering how to get featured. I appreciate all your help. Erin, all the tools I found made it complicated for consumers that were not in the real estate or mortgage industry, hope this helps them is simple terms, it helped me. Melissa, trying to help people understand better and thank you. Shawna, I want people to understand why it's so important to get these steps done. Thought of you and one of your past clients when I was writing it.
Mar 11, 2013 10:58 AM #5
Ambassador
3,906,034
Debbie Reynolds
Platinum Properties - Clarksville, TN
Your Dedicated Clarksville TN Real Estate Agent

Great information Katrina. You have explained one of those questions that is on the mind of many buyers.

Mar 11, 2013 10:59 AM #6
Rainmaker
50,601
Katrina Rockel
The Rockel Group - Fayetteville, NC
Thanks Debbie, I'm trying to be a source for buyers to have a better understanding of the process.
Mar 11, 2013 11:03 AM #7
Rainmaker
2,346,102
Roger D. Mucci
Shaken...with a Twist 216.633.2092 - Euclid, OH
Lets shake things up at your home today!

It was my pleasure to Feature your post in this group Katrina.  Any one of the people who moderate the group can Feature a post in this group only, not on the Home Page of ActiveRain............but that will happen for you, I'm sure, you write really great content.

Mar 11, 2013 11:22 AM #8
Ambassador
1,928,788
Silvia Dukes PA, Broker Associate, CRS, CIPS, SRES
Tropic Shores Realty - Ich spreche Deutsch! - Spring Hill, FL
Florida Waterfront and Country Club Living
Katrina, good information and well explained! Buyers need to know these things and the reasons behind it.
Mar 11, 2013 11:29 AM #9
Ambassador
1,831,412
Michelle Carr-Crowe Just Call 408-252-8900 Top 1%!
Get Results Team...Just Call (408) 252-8900! . DRE #00901962 . Licensed to Sell since 1985 . Altas Realty - San Jose, CA
Family Helping Families Buy & Sell Homes 40+ Years

It's helpful to let clients know the differences so they can prepare properly to buy a home.

Mar 11, 2013 12:26 PM #10
Rainmaker
353,915
Nina Rogoff
RE/MAX Executive Realty - Medfield, MA
Sells Real Estate!

Hi, Katrina! Welcome to Activerain. I saw Debbie Reynolds' re-blog of this post. This is exactly the type of information buyers in Fayetteville, NC will appreciate getting from you as their buyers' agent!

Mar 11, 2013 01:15 PM #11
Rainmaker
3,584,319
Dorie Dillard CRS GRI ABR
Coldwell Banker United Realtors® ~ 512.346.1799 - Austin, TX
Serving Buyers & Sellers in NW Austin Real Estate

Good morning Katrina,

Great explanation on the difference..it is important to know the difference..well done!

Mar 11, 2013 10:55 PM #12
Rainmaker
50,601
Katrina Rockel
The Rockel Group - Fayetteville, NC

Roger, you are so sweet and I am looking forward to my first featured blog on AR and I'm super excited you featured my blog in the group :)

Thanks Silvia for the comment.

Yes, Michelle it is important for us to help educate our buyers.

Nina, that's exciting that she re-blogged my post :) Thanks for lettng me know. I look forward to getting to know everyone a little better on here.

Hi Dorie, Thank you for your comment and it can be very confusing for buyers, glad this could help them.

Mar 12, 2013 08:25 AM #13
Rainer
42,766
Cassandra Stewart
Future Home Realty - Tampa, FL
Your Tampa Florida Agent

Katrina - This is a great article.   It explains both processes and sets the customer's expection on what to expect next.

Mar 15, 2013 11:33 AM #14
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Rainmaker
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Katrina Rockel

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