Pre-Approval VS Pre-Qualification
Are a mortgage pre-approval and a mortgage pre-qualification the same thing? NO WAY!
BEWARE of the 2-minute mortgage prequalifications obtained on certain websites.
A mortgage pre-approval letter and a mortgage pre-qualification letter are two documents that indicate that a lender is ready to lend you money for a mortgage, but they are not the same thing.
Mortgage pre-qualification:
A mortgage pre-qualification letter is based on the information you provide to the lender about your income, assets, and debts. This is a preliminary estimate of the amount of money you may be able to borrow for a mortgage, and it does not guarantee that you will be approved for a loan. A mortgage prequalification letter is usually based on a verbal or telephone conversation with a lender and does not involve a thorough review of your financial situation. This is a summary assessment.
Mortgage pre-approval
On the other hand, a mortgage pre-approval letter is based on a more detailed review of your financial situation. In order to get a mortgage pre-approval letter, you will need to provide the lender with documents such as pay stubs, tax returns, and bank statements. The lender will use this information to verify your income, credit score, assets and debts and will perform a credit check to assess your creditworthiness. A mortgage pre-approval letter is a more reliable indication that you will be approved for a mortgage and can give you a better idea of how much you can borrow.
MAKE AN APPOINTMENT
With the rapid advance of technology and the growing popularity of online banking, customers no longer need to physically travel to a bank to speak with an advisor.
Many financial institutions these days offer the option to book an appointment with an advisor over the phone or online, making it easier than ever to receive your pre-qualification before you begin your visits. Upon request, I can recommend you to excellent mortgage brokers.
In summary, a mortgage pre-qualification letter is a preliminary estimate of how much money you might be able to borrow for a mortgage, while a mortgage pre-approval letter is based on a more thorough review of your financial situation. and is more reliable indication that you will be approved for a mortgage. So it allows you to submit a more serious purchase offer.
