Getting preapproved for a mortgage is almost a requirement in today’s real estate world. In fact, many real estate agents won’t even let you into their cars to go look at houses until you’ve got your preapproval letter in your hand. And that makes perfect sense. Why would a real estate agent take some professional time showing houses if you’ve no such letter in hand. A preapproval letter lets the agent know right off the bat that you’re a serious candidate as a home buyer. Let’s look at four things you need to know about these preapproval letters.
The first thing to know is a preapproval is not the same as prequalification. Although the terms sound similar they’re not. Both terms apply to the mortgage industry but there are some key differences. A prequalification letter - the letter will state that it’s a ‘pre-qual’ - signifies that you’ve had a conversation with a licensed loan officer. With a prequalification, the loan officer will go through a series of questions and at the end of these queries the loan officer will or will not put together a letter that states ‘based upon the information provided’ the individual is in good shape to obtain financing from a mortgage company.
For more information about preapprovals visit the Scoop Blog
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