Once you begin to look for your new home, your real estate agent will probably ask you if you have been pre-qualified or pre-approved. That’s because having a pre-approval or pre-qualification will put you in a better position as a home buyer. Your real estate agent will be better able to narrow down the selection of homes for you to consider and home sellers will know that you are a serious and qualified buyer. There is a difference between a pre-approval and pre-qualification that is important to understand when you are negotiating the purchase of a home.
As your mortgage consultant, Marimark Mortgage will issue you a pre-qualification letter. In order to determine how much of a loan you should qualify for, we will gather information about your current income, assets, and debt obligations. With your permission, we will obtain your credit report and then look at the various programs available to meet your needs.
A pre-qualification letter, however, is not a commitment to lend you money. It is an estimate of what a lender will most likely lend you based on the limited information provided.
In order to get a pre-approval, additional information will be required. At that point, you will complete a mortgage application, which will provide information about your employment, assets, bank records, credit card debts, and other financial history. Our loan consultants will walk you through the process of completing the loan application. We will examine this information along with the other data provided in the pre-qualification phase to help you assess what loan options are best for you. We will then submit your application to a lender, who will determine for what amount you will be approved.
A pre-approval letter is not binding on the lender; it is subject to an appraisal of the home you wish to purchase and certain other conditions. If your financial situation changes (e.g. you lose your job), interest rates rise or a specified expiration date passes, your lender must review your situation and recalculate your mortgage amount accordingly.