Loan Pre-Approvals Put Buyers in the Drivers Seat

(May 2, 2006) -- Urging a potential buyer to get a loan pre-approval prior to house hunting can put that buyer in a powerful position. Unlike a pre-qualification, a pre-approval is supported by documentation that certifies income, debts, and credit history and tells a real estate professional, home builder, or seller that the buyer has the proven ability to buy a home.

The pre-approval process is identical to the loan application process except that the buyer hasn’t identified a property. Many lending companies will process the pre-approval free of charge to the potential home buyer. Other companies charge for the credit report and some charge an application fee.

Loan applications and pre-approvals take about an hour, more if there are questions.

Source: St. Louis Post-Dispatch, Jeff Tomlinson (04/26/06)