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Pre Approval Beats Pre Qualified Every Time!
So, you have been pre qualified for a mortgage. Do you think that this is the sort of letter that greases a sale? Quite frankly, it does not. Instead, if you are looking to buy a home and want to put some muscle in with your offer then a mortgage pre approval letter is the way to go. Let's take a look at two kinds of "approval" methods and how only way can truly pave the way to a home sale.
Pre Qualification Approval
Your realtor will want to obtain some information about your before showing you some homes. Generally, this information centers around your salary and possible debt information along with the amount of money you plan on putting down for a home. She will click on the calculator punch in some figures and tell you what price range homes you can afford based solely on the information that you provided.
Pre Approval Letter
Your mortgage lender will want to obtain some information about you before deciding whether or not you can get a mortgage. He will pull your three credit reports, look over your credit scores, and he may request a W2 form, recent pay stubs, and any other information that he thinks is necessary to help him determine whether he will lend money to you or not. If all goes well, you'll receive a letter from the loan officer spelling out your mortgage amount, interest, and term.
Which Is Better?
If you haven't figured it out yet, then you need to know that the mortgage pre approval letter is what sellers want to see while a pre qualification letter is simply worthless. With the former you have ironclad proof that you not only qualify for a mortgage, but that you have been approved for one and have written proof to show the seller. With the latter, you have nothing to show but what you told your realtor. Quite frankly, you could be telling a whopper of a lie! If your realtor believes you then she could orally share with the owner if asked what your qualifications are. She is as duped as the sellers are if she believes a falsely shared story.
The Quick Sale
So, if you have a pre approved mortgage and are the only one of three potential buyers who has one, who do you think has the edge with the seller? You do. Especially if you bid at or close to full price then you stand a better chance than the other two potential buyers who only bothered to get pre qualified, but not approved.
