A: Getting pre-qualified is the first step in the mortgage process. It involves supplying a lender with basic information regarding your debt, income and assets. From this information, lenders can get an idea of the mortgage amount for which you qualify, and it can usually be done at no cost.
Getting pre-approved is the next step. The process requires that you complete a mortgage application (and usually pay an application fee) and supply a lender with all the necessary documentation to check your financial background and credit rating. You will then be told the exact mortgage amount for which you are approved.
The obvious advantage of completing both of these steps before you look for a home is knowing in advance how much you can afford to spend. You won’t waste time looking at properties beyond your means. The initial pre-qualification stage allows you to discuss with your lender any goals or needs you may have regarding your mortgage. He or she can then explain your mortgage options and recommend the type that might be best suited to your particular requirements.
Getting pre-approved for a mortgage also enables you to move quickly when you find the home of your dreams and make an offer that is not contingent upon obtaining financing. It also lets a seller know your offer is serious and could prevent you from losing out to another purchaser who already has financing arranged.
When you request a mortgage through LendingTree, you can get pre-qualified with up to four Lenders. You can then choose which offer you prefer and, contingent upon verification of your assets and credit, get pre-approved with that Lender directly.
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