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Pre-qualification vs. Pre-approval
There are some major benefits of getting pre-qualified or pre-approved prior to looking to purchase a new home. When you make an offer and you have a pre-qualification or pre-approval letter, the seller can be assured that your loan will close easier than a buyer that has not been pre-qualified or pre-approved. They will take your offer more seriously. There are a few basic differences between getting pre-qualified compared to pre-approved.
When you get pre-qualified, Premier Financial (the lender) will take information that you, the borrower, gives to us verbally and qualifies you with that information. The information that we will ask you for is your income, credit history and savings (down payment) information. With that information we will calculate how much of a home you can afford to purchase. This process usually only takes a few minutes. Once we have come up with an amount for the new purchase price and loan amount, we can write a pre-qualification letter that you can give to the seller when you make an offer. This is a good start, but it is not as good as a pre-approval. If by chance you do not qualify for a new home due to credit problems, down payments etc, we will help you to correct these items so that you will be ready to buy in the very near future.
The pre-approval process takes the pre-qualification one step further. We will take a loan application and ask for all documentation to support the information that you have given to us for the pre-qualification. The documentation required for a pre-approval is usually 2 years tax returns (Federal Only), 2 current pay stubs, we will pull your credit report and they will send a verification form to your bank and employer for completion. If there are any derogatory items on the credit report, a letter of explanation will be required. Once we have all documentation needed for underwriting, we will submit your loan to the automated underwriting system (also known as a DU, LP or FHA scorecard). If you have been approved then at this point, we can give you a pre-approval letter. Keep in mind that this is not the end of the underwriting process. If your loan is approved by the automated system, there may be additional conditions required before sending the loan to the underwriter for final loan approval. Before submitting the file for final underwriting the remaining documentation will need to be in the loan file. These items are usually the signed purchase contract, appraisal, escrow instructions and preliminary title report.
One of the benefits of using Premier Financial is that we handle FHA, conventional, jumbo FHA, jumbo conventional and jumbo loan programs in-house. So there are very few types of programs that we do not carry. You get the best of both worlds with Premier Financial.
To be pre-approved, please click here to fill out our pre-approval form and we will contact you within 24 hours. If you would like a quick rate quote, please complete the form below.
To be pre-qualified for an FHA loan, please complete the following form. If you have a more detailed loan scenario, please click here and complete the form for a free pre-approval. We will contact you within 24 hours.
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