What’s the smartest financing?

Pre-qualification

Through a brief phone conversation, a lender can pre-qualify you for a mortgage. The lender does not validate credit history or employment information, so this is a non-binding opinion regarding how much of a mortgage you can afford. You will get an estimated monthly payment and a price range to guide your home buying. You do not get a guarantee that you’ll be approved for a mortgage.

Pre-approval

After formally applying for a loan, including providing necessary documentation related to employment and financial disposition, the lender evaluates and verifies your information to determine your qualifications. This is not a firm commitment. The loan is subject to a fully executed sales contract and an acceptable appraisal. However, pre-approval can give you more leverage with a home seller.

Firm commitment

A lender can issue a firm commitment once the seller accepts your offer, the home receives a satisfactory appraisal, and your credit is rechecked. To help eliminate surprises, Prudential Realty representatives will also help you:

1. Be alert - Many lenders use the term “pre-approval,” but when you read the fine print, it’s really a pre-qualification
2. Work with the lender if your financial circumstances change prior to closing