Pre-Qualified vs Pre-Approved (2022) - Finally Understand The Difference!

Pre-qualified vs pre-approved: should you get pre-qualified or pre-approved? What is the difference?

Today I am going to share with you what is the difference between getting pre-qualified vs pre-approved.

I am going to be covering why you need to get pre-qualified and or pre-approved, what is the difference and how long it takes so by the end, you are going to understand what you should do first, either getting pre-qualified vs pre-approved when buying your first home.

So enjoy, sit back and relax!

Also, this is a written summary:

pre-qualification for home loan or for a mortgage
- What is it?
  - This is the first step to get a general feel
  - You don’t need to supply any documentation Then they will tell you verbally an estimate of how much you can qualify for
  - This is also great to get general information about the home buying process
- So does pre qualification need a credit check?
  - This depends on the lender
  - Usually, they don’t need to but some lenders won’t send you a pre-qualification letter without doing a soft inquiry on your credit,
  - So What is a soft credit check for a mortgage and will a soft credit check affect mortgage application
  - a soft credit check is a type of inquiry that doesn’t impact your credit scores because the lender only wants to provide a rate quote and you’re not applying for credit.
- Most sellers won’t take your offer because it is not serious. You’ll need a pre-approval
pre-approval letter or mortgage pre-approval letter
- What is?
  - you are ready to go, you supply tax returns, social security, and a loan officer calculates, runs credit, and makes through everything is ready to go
- why get pre-approved for a mortgage
  - Get take seriously
  - Be able to work with an agent to see homes (most agents need this because they don’t want to waste their time
  - Don’t waste time or have a broken heart
  - Make sure you are comfortable with your payment
- how to get pre-approved for a mortgage?
  - Fill up an application
  - Provide the lender with all the documents they need (tax returns, W2s, ) to validate your financial picture
  - Run your credit score and check your credit report
- What if you are scared of being pre-approved?
  - Does pre-approval affect credit score?
  - A traditional mortgage pre-approval creates a hard inquiry and it will be recorded on your credit report.
  - According to FICO it could lower your credit scores by up to 5 points and it considered all mortgage applications within a 45-day window just as one credit event
  - To reduce the effects of hard inquiries, you should request pre-approvals and submit mortgage applications within a short window, basically when you are ready to send home buying offers.
  - What if my mortgage pre-approval is denied
  - Then your loan officer will give you a few tips to get accepted next time.
- how long does it take to get a pre-approval letter
  - It usually takes around 48 hours to get pre-approved by a local lender.
  - An online lender will take much less, usually only the time that takes you to upload the documentation but I wouldn’t recommend doing that because listing agents don’t trust so much online lenders and you are not going to get that personal recommendation
- Should you get a mortgage pre-approval online
  - No, because you may not be taken seriously in a strong buyer’s market
  - All the mortgage options available to you, like local grants or down payment assistance programs, so ideally you want to go with a local lender
- how long does mortgage pre-approval last how long is a pre-approval letter good for
  - A mortgage pre-approval typically lasts between 60 and 90 days but it really depends on your lender and it will state it on the letter.
  - Why? Because your financial situation and the market could change
- how many pre-approval letters should I get?
  - You just need one but nothing stops you to get other pre-approval letters

— HELPFUL TOOLS —
✅ Connect with a great home buyer AGENT or LENDER in your city → https://app.tryhomeflow.com/find-great-buyers-agent
✅ Download HomeFlow, The Smart Home Buyer App → https://lauramoreno.com/homeflow/
✅ Schedule A Free 20-Minute Home BuyerStrategy Call → https://calendly.com/ms_homebuyer/20-minute-call
✅ Get The Smart Home Buyer Calculator → https://lauramoreno.com/calculator/
✅ Buy or Sell your home in Brooklyn, New York using Laura Moreno as your agent → https://lauramoreno.com/hire-me/

— RELATED VIDEOS —
⭐ 10 First Time Home Buyers Mistakes – https://youtu.be/G0pkb1FvG5s
⭐ How Much House Can I Afford? – https://youtu.be/dAYEj1_5G_I
⭐ How To Find A Great Agent? – https://youtu.be/7F6LoQeCzaA
⭐ Top Questions To Interview Your Agent: https://youtu.be/nIGpPD05IQQ
⭐ Playlists – https://www.youtube.com/c/LauraMorenoCabanillas/playlists

– DISCLAIMER –
Laura Moreno is a licensed real estate agent in Brooklyn, New York with eRealty as of the time of making this video. All information given is meant to be educational and be a starting point in your home buying/selling journey. All topics in my videos are based on my prior experiences, please double-check and confirm/consult with a local licensed professional real estate agent or mortgage lender if it applies to your situation.

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