The Difference Between Prequalification and Approval: Avoid Costly Mistakes When Buying a Home

Hi, my name is Yvonne Paredes with Realty ONE Group Elite in Walnut Creek. Did you know that failing to understand the difference between prequalification and approval could end up costing you thousands of dollars? As a seasoned real estate expert, I’ve helped countless buyers avoid costly mistakes during the home-buying process. Let me explain why this distinction is so crucial.

What Is Prequalification?

Prequalification is the initial step in the home loan process. It’s essentially a preliminary conversation where you discuss your financial situation with a loan officer. However, nothing is verified at this stage. While it gives you a general idea of how much you might be able to borrow, it’s not a guarantee of approval.

Why Prequalification Isn’t Enough

A prequalification is not the same as a true loan approval. Relying solely on prequalification could lead to unexpected surprises down the line, potentially jeopardizing your ability to secure your dream home. Without full approval, you’re at risk of losing your initial deposit, as well as any money spent on inspections or appraisals if the deal falls through.

What Is Loan Approval?

Loan approval is a more in-depth process. This is where you provide the lender with all the necessary documentation, including income verification, tax returns, and credit information. Once these details are reviewed and verified, the lender can confirm how much you’re approved to borrow, which loan products are best for you, and what interest rate you can expect. This critical step provides clarity and security, ensuring you’re financially prepared to move forward.

Why You Need to Get Fully Approved

Skipping full approval can result in significant financial loss. For example, if you’ve already spent money on inspections, appraisals, or other upfront costs, and your loan falls through, you’ll lose not only those funds but also valuable time and potentially the home you were planning to purchase.

Let Me Guide You Through the Process

Don’t fall into the trap of relying solely on prequalification. As your real estate agent, I’ll walk you through the safest and most strategic way to become a homeowner. My goal is to protect your best interests every step of the way.

The Best Part? My Services Are Free to You

It’s important to note that it’s free to have an agent represent you as a buyer. The seller covers our fees, so you’ll have expert guidance at no additional cost. I’m here to ensure you’re fully informed and confident in your decisions.

Ready to Take the Next Step?

If you’re thinking about buying a home, don’t leave anything to chance. Call me today, and let’s work together to make your dream of homeownership a reality—safely and strategically.

For more information reach out to me

✉️[email protected]

📱925-212-3491