Pre-Approved and Pre-Qualified Home Loans: Know the Difference
Sep 17, 2018 Home Loan
We do not bother to know about financial terms unless we need one. Many are dependent on a home loan to buy their dream home. Bankers approach in many ways promising to give loan whenever you require. However, it is not the actual scenario when it comes to the desired amount of home loan.
The pre-approved home loan can be one of the ways to get home loan easily. Now, pre-approved or pre-qualified – we should know the difference.
The pre-approved home loan can be one of the ways to get home loan easily. Now, pre-approved or pre-qualified – we should know the difference.
Pre-Qualified Home Loan
This is one of the initial steps that home buyers should take if they are planning to avail home loan. This helps to know whether you are eligible for the home loan, and so then the amount that you are entitled to avail loan.
Documentation required for this process is about your financial status, which includes your income, any previous loan details and assets that you may possess. You can check this online at the bank’s website, or you may visit the branch. One of the representatives can assist you. Credit score for this process is not required. The bank representative can suggest you the type of loan that suits your requirements. Note that this just a projection of the amount. The actual amount of loan sanctioned may not be the same. You will have to wait until you move to the pre-approved stage.
Documentation required for this process is about your financial status, which includes your income, any previous loan details and assets that you may possess. You can check this online at the bank’s website, or you may visit the branch. One of the representatives can assist you. Credit score for this process is not required. The bank representative can suggest you the type of loan that suits your requirements. Note that this just a projection of the amount. The actual amount of loan sanctioned may not be the same. You will have to wait until you move to the pre-approved stage.
Pre-Approved Home Loan
The word pre-approved means that you have already crossed the stage of the approval process. This is the next step of your loan sanction.
Based on your income, credit-worthiness and financial standing you can know your loan eligibility limit. This is your home loan application stage where you apply for a loan by paying a fee. You need to share your financial status documents as well as the credit score details. This is when you how much the lender is ready to grant you loan along with the rate of interest details. However, this not a guarantee to lend you money. Duration of this stage can be as short as three days to several months depending on various factors.
Now that your information about your loan amount and the repayment details, you can start looking for your home as per the budget and the amount of down payment that you need to arrange. This makes it possible for you to just plan it right and less hassle at the last moment when you lock your eyes upon your dream home as you know about the financial needs way before even start looking for a house.
Based on your income, credit-worthiness and financial standing you can know your loan eligibility limit. This is your home loan application stage where you apply for a loan by paying a fee. You need to share your financial status documents as well as the credit score details. This is when you how much the lender is ready to grant you loan along with the rate of interest details. However, this not a guarantee to lend you money. Duration of this stage can be as short as three days to several months depending on various factors.
Now that your information about your loan amount and the repayment details, you can start looking for your home as per the budget and the amount of down payment that you need to arrange. This makes it possible for you to just plan it right and less hassle at the last moment when you lock your eyes upon your dream home as you know about the financial needs way before even start looking for a house.
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