Are you in the market for a new home? If so, you are most likely planning to finance it with a home loan. Many potential buyers wonder if they should get prequalified or preapproved for a home loan before they start talking to a real estate agent. As a first time home buyer, and even as a repeat buyer, you probably have a variety of questions. What is the difference between prequalified and preapproved? When should I apply for a home loan? What lender should I work with?
Learn the answers to these questions and more to make the home buying experience smooth and easy.
Prequalified vs Preapproved
To be prequalified or preapproved for a home loan it is necessary to contact a lender and provide personal and financial information. Applying for prequalification is not as rigorous as applying for preapproval. A lender may provide you with an amount that you are prequalified for in order to give you an idea of your price range while you are house hunting. However, the prequalified amount may not be as accurate as a preapproval amount because not as much information was taken into account.
There are 3 reasons it is in your best interest to apply for a full preapproval before you start looking at homes (keep in mind that you are not obligated to work with the lender you gives you preapproval): FEEL FREE TO REWRITE THESE POINTS IF YOU CAN DO BETTER
- You need to have a solid idea of what you can afford.
- A REALTOR® will want to know how much you can afford before showing you any homes because doing otherwise may only result in massive disappointment for you if you choose a home you can’t afford.
- Once you do find the home you want to put an offer on, sellers will choose the buyer who is prequalified over one who is not when the offers are a similar amount.
If you need help to become prequalified, your real estate agent can guide you through the process and recommend lenders they have worked with successfully in the past. Once you have a preapproval amount from a lender, your agent can begin helping you find homes in your price range.
Real Estate Agents vs RealtorsⓇ
Not everyone understands the difference between real estate agents and RealtorsⓇ. Every RealtorⓇ is a real estate agent, but not every real estate agent is a RealtorⓇ. RealtorsⓇ are certified real estate agents that belong to the National Association of RealtorsⓇ. They subscribe to a specific code of ethics and uphold a higher standard than other real estate agents.
The Pamela Walters Group Can Help You With Home Loan Preapproval
The real estate agents of the Pamela Walters Group are all RealtorsⓇ, providing you with the highest level of service in the industry. Whether you are prequalified/preapproved for a home loan or not, feel free to contact us to get started. We provide assistance with the preapproval process, recommending a variety of reputable lenders for you to choose from.
We recommend that you get fully preapproved before starting your home search to save yourself time and money. Once you put an offer on a home and provide good faith or due diligence deposits, you can lose that money if your loan is not approved. We want to help you avoid potential pitfalls to make the home buying process a smooth one.
Call (903) 962-0075 or contact us to get started.