March 24th, 2016 | Pre-Approval Advantage & Definition
A Pre-Approval is an initial mortgage loan commitment from a lender where a person has completed an application, and supplied income date, W-2′s, bank statements, etc. to their Mortgage Loan Officer. The lender has gathered information about a person’s employment and has reviewed the credit report. A Pre-Approval is a far more complete and comprehensive process than what is performed for a Pre-Qualification.
A Pre-Approval can help buyers to take the guesswork out of selecting a price range of a home. The big plus having a Pre-Approval
is in the eyes of any seller, the buyer is considered a “stronger buyer” with a Pre-Approval letter than with just a Pre-Qualification letter.
Pre-Approval is very helpful as a bargaining tool in negotiating a better deal with a seller. Having a Pre-Approval letter can make a buyer feel more comfortable with the home buying process and hve more of a leg to stand on when negotiating with sellers.
In real estate nothing is absolute. A Pre-Approval nor Pre-Qualification letter is not an iron-clad loan commitment from a lender.
A lender will still have to look closer to assess property appraisals, verify the information collected and re-check the credit report
before getting a final approval for a mortgage.
For more detailed information on the process of a mortgage click on 1 Stop Mortgage “Mortgage Process Explained”: http://www.1stophomeloans.com/mortgage-process-simplified/