Are you pre-qualified or pre-approved for a loan?
Before you begin to shop for a new home, you should set up a time to meet (or do a phone conference) with your Southeastern Mortgage loan officer, so we can figure out how much you can afford. This will put you in a better position as a buyer.

It is important to understand the distinction between being pre-qualified for a loan and pre-approved for a loan. Most people only need to be pre-qualified to make an offer on a house, but occasionally we will recommend getting a "pre-approval" instead. Either type of approval is crucial when you decide to make an offer on a house. Most buyers won't even consider an offer if there is no pre-qualification letter to go with it.

To get pre-qualified for a loan, we will collect information about your debt, income, and assets. We’ll look at your credit profile and assess goals for a down payment and get an idea of different loan programs that would work for you. We will make sure you clearly understand the amount you are pre-qualified to borrow. Once you find a property you want to make an offer on, we will issue a pre-qualification letter specific to that property. We do not usually disclose your maximum borrowing potential because we do not want to undermine your ability to negotiate a better sales price.

It is important to understand that a pre-qualification letter is based on an estimate of what you are eligible to borrow, not a commitment to lend. A commitment to lend comes only after a full loan application and all pertinent documents have been submitted and approved by an underwriter.

To get pre-approved, you will complete a mortgage application and provide us with various information verifying your employment, assets and financial status such as W-2 forms, bank records and credit card statements. We’ll review your mortgage options and submit your application to the lender that best meets your needs. Once the application process is complete you will receive a pre-approval letter indicating the amount your lender is willing to lend you for a home purchase.

A pre-approval letter is also NOT binding on the lender by itself; it is subject to an appraisal of the home you wish to purchase and certain other conditions. If your financial situation changes (e.g. you lose your job), interest rates rise or a specified expiration date passes, your lender must review your situation and recalculate your mortgage amount accordingly.

At Southeastern Mortgage we typically would only go through having a potential client pre-approved vs. pre-qualified if they have unusual circumstances that we feel do not clearly fall into guidelines. In that case, we would want an official underwriting opinion prior to you entering into a contractual situation.

We will always consider what is best for the customer and 99% of the time we can accurately assess your buying potential with a pre-qualification rather than obtaining a full pre-approval.

Call your loan officer today to find out your purchase power!