What’s the Difference Between Pre-Qual and Pre-Qualification?
Confused by real estate lingo? You wouldn’t be the first.
What’s a Mortgage Pre-Qualification?
As a first-time buyer, one of the first details you need to pin down is how much house you can afford to buy. You wouldn’t want to waste time looking at homes you can’t afford.
You need a ballpark estimate, just to get the ball rolling on your home search.
Pre-qualifying for a mortgage is that first-step estimate. During the pre-qual process, a lender will ask you for your key numbers:
- Income (pretty self-explanatory)
- Assets (vehicles, stocks and bonds, savings, and so on)
- Debts (student loans, credit card debt, car loans, and such, added together)
- Potential down payment (how much cash you could potentially pay upfront for a home)
You could sit down with a mortgage loan officer in person to discuss these financial details, but you don’t have to. It’s totally doable to get pre-qualified for a mortgage online.
Notice that at this stage, all your financial info will be self-reported. There’s no verification of your math, no documentation of your numbers needed.
Importantly, this pre-qual discussion is also free.
Based on the info you’ve supplied, the mortgage loan officer will give you that ballpark estimate of what mortgage amount you qualify for, price range of homes you could afford to buy, and the types of loans available to you.