Posted on: 04th Oct, 2005 05:31 pm
Are Prequalification Letters a valid document?
Hi Craig,
Prequalification is an informal procedure to know one's affordability in buying a home. In this process a person seeking mortgage actually meets a mortgage broker or a loan agent to judge his own capability in buying a home.
The broker or agent asks certain questions to the borrower regarding his income, savings and debt. This helps in evaluating the price that the person can afford to buy a home. The broker has no obligation to grant the buyers a loan whom he pre-qualified.
Most prequalification letters have a disclaimer to protect the lender where it states that the buyers appear to be qualified for a certain loan amount.
A prequalification letter only indicates that the buyers have taken the first step toward lining up a mortgage. But, none of the buyers should have a false sense of security with the prequalification letter.
A buyer can strengthen his prequalification letter to some extent if he can get his credit checked by the lender and the letter states that the buyer's credit was checked and was acceptable to the lender.
A prequalification letter is not an indication that a loan process has started but at least it says that the buyer appear OK financially.
Hope this information will help you.
Regards,
Jason
Prequalification is an informal procedure to know one's affordability in buying a home. In this process a person seeking mortgage actually meets a mortgage broker or a loan agent to judge his own capability in buying a home.
The broker or agent asks certain questions to the borrower regarding his income, savings and debt. This helps in evaluating the price that the person can afford to buy a home. The broker has no obligation to grant the buyers a loan whom he pre-qualified.
Most prequalification letters have a disclaimer to protect the lender where it states that the buyers appear to be qualified for a certain loan amount.
A prequalification letter only indicates that the buyers have taken the first step toward lining up a mortgage. But, none of the buyers should have a false sense of security with the prequalification letter.
A buyer can strengthen his prequalification letter to some extent if he can get his credit checked by the lender and the letter states that the buyer's credit was checked and was acceptable to the lender.
A prequalification letter is not an indication that a loan process has started but at least it says that the buyer appear OK financially.
Hope this information will help you.
Regards,
Jason
Hi Craig
Welcome to the forums.
Prequalification is an important step towards getting a mortgage loan for any purpose ? buying a home or paying off a previous mortgage or taking a loan for home improvements. Mortgage seekers generally contact some lenders and provide details on their financial situation and credit status.
When a lender prequalifies you, it implies that you have the possibility of getting a loan depending on your income and financial obligations. The lender then provides you with a prequalification letter which acts as a valid proof of your capability of getting a loan and repaying it.
The prequalification can help further, when you approach a lender to get preapproved. A preapproval confirms that you will be offered a certain loan amount based on your income and credit history. Thus, the prequalification letter makes the loan process easier since the lenders will be willing to review your income and credit history based on which they can come up with loan offers.
Hope we have been able to guide you. To know more about prequalification, visit http://www.mortgagefit.com/qualification-approval.html
Regards,
Caron.
Welcome to the forums.
Prequalification is an important step towards getting a mortgage loan for any purpose ? buying a home or paying off a previous mortgage or taking a loan for home improvements. Mortgage seekers generally contact some lenders and provide details on their financial situation and credit status.
When a lender prequalifies you, it implies that you have the possibility of getting a loan depending on your income and financial obligations. The lender then provides you with a prequalification letter which acts as a valid proof of your capability of getting a loan and repaying it.
The prequalification can help further, when you approach a lender to get preapproved. A preapproval confirms that you will be offered a certain loan amount based on your income and credit history. Thus, the prequalification letter makes the loan process easier since the lenders will be willing to review your income and credit history based on which they can come up with loan offers.
Hope we have been able to guide you. To know more about prequalification, visit http://www.mortgagefit.com/qualification-approval.html
Regards,
Caron.
PLEASE GET ME A PREQULIFICATION LETTER FOR A HOME ALREADY PICKED OUT
prequalification is a big "if." what you want as a prospective buyer is a preapproval, whereby your income, assets, credit, etc. have been verified and a lender can assuredly say that you qualify for a specified type of mortgage with a specified amount.
