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Getting Pre-Qualified

Do you really need to get pre-qualified for a home loan?

Ask any real estate agent or lender, and they will tell you the importance of pre-qualification!

Shopping for a home before getting pre-qualified for a mortgage is the equivalent of walking into a grocery store without a wallet. You won’t get very far in either situation if you can’t verify that you have the resources to complete the purchase. Yet many homebuyers skip the pre-qualification process, hoping to finalize a sales contract that same week, not realizing that agents and sellers will typically not entertain an offer without a pre-qualification letter.

What is Pre-Qualification?

A pre-qualification means the lender has actually checked your credit to determine a specific loan amount. Pre-qualification letters are issued for a particular time period, such as 120 days.

In a competitive market, any serious buyer should pursue a pre-qualification letter from a lender before beginning a home search.


Why Get Pre-Qualified?

By being pre-qualified, you will know where you stand in the home buying process.  Many buyers put off this important step because they fear a lender may not approve them for the amount they plan to spend. Others simply don’t want to share their private information with a lender until they find the house they want.

In addition, some buyers assume that if they pay their bills on time and earn about the same as their friends who just closed on a $300,000 mortgage, they will also qualify for the same loan amount. This is not always the case. Even a small difference in credit scores can affect one’s ability to qualify for a loan and the amount of down payment required.

Getting the Credit You Deserve

During pre-qualification, your lender will review your credit scores and point out if you have deficiencies or errors in those scores. This allows you time to fix unexpected errors and improve your credit score, ultimately helping pave a smoother path to purchasing the home of your dreams.

Work with a friendly home loan specialist in your area to get pre-qualified.


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Hawthorn Bank is an Equal Housing Lender.