Pre-Qualifications vs Pre-Approvals vs Fully Underwritten Loan Approvals

A Pre-Qualification will give you an idea of what you can afford

• Is typically a quick verbal process with your the broker
• You don’t have to complete a loan application
• Credit report can be instantly run and your FICO score secured
• Income, assets and employment history can be given verbally

A Pre-Approval (with or without an AUS) is important when you’re actively looking for a home. Most sellers are fine with this form of Pre-Approval

• A Pre-Approval Letter is given by the broker or lender stating that you qualify for X amount and stating what remaining items are required …ie…appraisal, title report on subject property, etc
• Best to have it customized with the property address and price you are offering if known
• Broker or lender has evaluated all pertinent info needed to determine amount qualified for
• FICO scores and credit analyzed, and an AUS can be run if credit or debt ratios are a concern
• Paystubs, bank statements and employment history are verified to ensure they conform to the loan program
• A Pre-Approval Letter will increase the odds of your offer being accepted
• Speeds up the process when your offer is accepted

Fully Underwritten Loan Approval – Your offer has been accepted and you’re in contract to buy your home. (Usually only new home builders with their own preferred lender want this as well)

• Similar to Pre-approval above, but an offer has been accepted, escrow is opened, and the loan officially starts as follows…
• We provide you with a spreadsheet of rate options with detailed cash flows for each, so that you can fully understand the TOTAL cash needed to close, and then we help you decide which is best
• Once an initial specific rate and program is chosen, we produce a fully completed application package w/ disclosures and a checklist of any missing documents needed
• You will only need to e-sign the package above and upload any missing documents needed
• Escrow and Title forward info to us, and we order an appraisal (usually we wait until after home inspection and any resulting request for repair negotiations are cleared first)
• We submit all info and reports above to the best wholesale lender for you, and have Final-Ready to Close Approval issued

Scot Presley - Presley Financial