GRAND OAK
Mortgage Company
810.698.5400
Pre-Qualification vs. Pre-Approval
know the difference
Confusion often arises over the difference between pre-qualifying and pre-approving.
A buyer has been pre-qualified when he or she has spoken at length with someone who has questioned them on credit history, employment, upfront cash, etc. That person then usually calculates debt ratios and comes up with a maximum loan amount under one or more scenarios. It is an informal process that can be accomplished over the telephone.
One step better is getting pre-approved. With a pre-approval, we will take an actual application for a mortgage and send it to an underwriter for approval (subject to an appraisal when you find a house). The only upfont cost is $45, for a credit report, which is subtracted from the cost to you at closing.
Here are some of the advantages in being a pre-approved buyer:
1. In most cases you can close within about 2 weeks after signing a purchase agreement.
2. Sellers are usually easier to work with because an offer from a pre-approved buyer carries more weight. In effect, it is almost like a cash offer. When you are approved, you will be given a certificate to verify your approval with Grand Oak Mortgage Company.
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