Special offer

Pre-Approved vs. Pre-Qualified

By
Mortgage and Lending MLS# 279272

I need to thank Erik at Open Home Mortgage who e-mailed me a reminder regarding my last blog about getting 'pre-qualified'. He & I actually are in 100% agreement on what a potential homebuyer should do to properly work with a Mortgage Professional, we just called it different things!

Erik & I believe in the concept of being "pre-approved", not just pre-qualified.

What's the difference? The difference is in actually meeting with your new client, getting a current paystub (or two), verifying their employment history, verifying their assets, and not just pulling their credit, but actually going over it with the client.

NOW, when I send a letter to my Realtor, they know that this client has been run through FannieMae's Desktop Underwriter OR has been run through any of the many automated underwriting systems from Alt-A lenders....and that a deal will happen.

That's what seperates a Mortgage Professional from an "LO", in my book. Take the time to make sure your client will qualify, not just "well, someone will take them"......, and you'll earn a Realtor's trust...and their referrals! 

Lisa Hill
Florida Property Experts - Daytona Beach, FL
Daytona Beach Real Estate
As a Realtor, I always want a pre-approval letter instead of a pre-qual letter, before working with them. I council my sellers about this too.
Apr 30, 2007 04:28 AM
Michael Thompson
CENTURY 21 Anderson Properties, Inc. - Anderson, SC
MBA

I agree that it is a requirement to get potential buyers "pre-approved" before the start of house hunting. However, that is not a panacea for all the financial problems that may pop up.

I recall one incident in which I was the listing agent on a house. An offer was presented with a "pre-approval" letter. The offer was accepted. Three days before closing the bank rejected the loan!

Needless to say the caused alot of grief for me and my seller. After several attempts to get the buyer "pre-approved" again, my seller had enough. I lost the sale and the listing.

Michael Thompson, MBA, Realtor
Century 21 Anderson Properties
http://www.MichaelThompsonProperties.com/

Apr 30, 2007 04:40 AM
Ana Connell
G & C Properties - Burbank, CA
Burbank Real Estate Agent
Good point!  Thank you!
Apr 30, 2007 04:55 AM