Pre-Qualified
- Simple and somewhat quick
- Provide bank with general financial outlook (income, debts, etc)
- Can be done over the phone/internet
- Usually free of charge, and doesn't create commitment with any lender
- DOES NOT pull credit
Pre-Approved
- Much more involved (actual filling out of mortgage application, paying small mortgage app fee)
- Credit pulled, more specific docs needed for loan officer
- Lender can tell you specific amount of mortgage you can actually afford
- Shows the seller you are fully committed to obtaining a mortgage, will have better negotiations than someone who is just pre-qualified
Pre-Quals are great if you are just starting to look, it helps yourself and your Realtor know what price ranges you can start to look in. Also, before you could even submit an offer on a home, at least a Pre-Qual would be needed for any seller to take you seriously. Let me know if you have any questions!
