Pre-Qualification vs. Pre-Approval
In today’s competitive real estate market and tight lending environment, pre-approvals are more important than ever. Buyers and sellers need to understand the difference between a pre-qualification and a pre-approval.
A pre-qualification is a simple non-binding letter drawn up by a mortgage salesperson that states that they have reviewed the financial information and that the client should qualify for an approximate loan amount.
A pre-approval letter is typically accompanied by a written commitment from the credit officer who has underwritten the full financial package. There will be conditions, including but not limited to the full appraisal (excluding NJ) on the subject property, to the commitment letter that must be satisfied for the commitment to be binding.
Buyers and sellers should be aware that just because a salesperson says that a potential borrower is a pre-qualified or pre-approved, each party should read the letters and approvals and speak to the person who has the authority to make that important underwriting decision.
Why settle for a pre-qualification when GuardHill Mortgage can provide a fast pre-approval supported by a conditional commitment letter?