Mortgage industry terms—there are many and it can be hard to make sense of them, especially when they seem so similar. Pre-qualification and pre-approval are often used interchangeably, but there are some major differences between the two. Both options can be helpful to your Realtor and other mortgage professionals while shopping for a home, but a pre-approval can help you further along your mortgage journey than a pre-qualification. This guide will help break down the benefits of both options.
1. They can estimate the loan amount you qualify for.
When you first start looking for a home, you will have your own thoughts about how much house you can afford. Getting either a pre-qualification or pre-approval will give you an estimate based on things like income and credit score. From there, you can start to eliminate homes that are too high for your price range and start to look for the home that fits all of your needs including your budget.
2. They can show sellers that you are a serious buyer.
When we are experiencing a seller’s market, which means the housing inventory is low and houses don’t stay in the market for long, it can be important to have a pre-qualification or pre-approval. This will show the seller’s that you have already gone to a mortgage professional and taken the first steps in buying their home. This means you are a more serious buyer, which is a more confident sell for them!
3. They can give you a better chance of getting a loan for the amount you’ve offered the seller.
Getting a pre-qualification or pre-approval means that a professional has taken time to look through your finances to see what you will qualify for. As you continue through the mortgage process, you will receive a loan amount that is not far off from what you have already been approved or qualified for.
You’ll save yourself and others a lot of time and energy by getting pre-approved for home financing. Most real estate agents prefer that you have a letter of pre-approval before starting to shop for a home. The great news is that there is no charge and no commitment to go through our easy online pre-approval process at ruoff.com.
In recent years, getting a mortgage online has become more and more common – but most people are worried about making such significant financial ...
Just like in the legal industry, the financial and mortgage industries are full of jargon and complicated terminology. Fortunately, mortgage origination has ...
1700 Magnavox Way, Suite 220, Fort Wayne, IN 46804
Ruoff Mortgage Company, Inc supports Equal Housing Opportunity
Ruoff Mortgage Company, Inc., d/b/a Ruoff Home Mortgage, is an Indiana corporation licensed by the Indiana Department of Financial Institutions (DFI). For complete licensing information visit: http://www.nmlsconsumeraccess.org/EntityDetails.aspx/COMPANY/141868. Equal Housing Lender. NMLS#141868
800.627.8633 | NMLS ID: 141868 | NMLS Consumer Access
ALL RIGHTS RESERVED