Pre-qualification vs Pre-Approval – What should you get?
A guide to mortgage pre-qualifications and pre-approvals.
Even if you're not a first-time home buyer, it's always a good idea to decide what you can afford before you begin viewing prospective homes. There are two ways to do this: by getting a loan pre-qualification or pre-approval from a mortgage lender.
Below is an explanation of the differences between pre-qualifications and preapprovals, and why I encourage borrowers to obtain a pre-approval letter before arranging property viewings.
A loan pre-qualification* is faster to obtain and provides a ballpark estimate of the amount of loan funds that may be available to you. If you're wondering about how much loan you'll qualify for, a pre-qualification is a way to begin.
A loan pre-approval* may take a few days to obtain, but it enables you to provide proof to home sellers that you have a conditional loan approval. If you're ready to commit to a purchase, a pre-approval letter can help you or your Realtor® negotiate with sellers.