Home Buying in Bronx>Question Details

Andrea, Home Buyer in Bronx, NY

hi my mother was told that she was preapporave for an fha loan. Then they broker told her that he has to let

Asked by Andrea, Bronx, NY Wed Jun 18, 2008

an underwriter take a look at her papers. i wante dto know if that is the routine for an fha loan preapporval letter.

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Your mother was Pre-Qualified - not Pre-Approved. Pre-Qualification happens when a lender or mortgage broker speaks to you on the phone for 5 minutes, asks you some questions about how much you make and etc, and then writes up a Pre-Qualification Letter...They don't verify if any of your answers are true or not.

Pre-Approval occurs when you give them copies of pay stubs and other documentation (such as tax returns, etc) and they send it all to an underwriter. When the underwriter comes back and says "yup - everything checks out - we can give you a loan for X dollars so long as the home appraises" - THEN you have a Pre-Approval.

A pre-qual is generally not worth the paper it's written on. A pre-approval can help you have some extra negotiating power when you're dealing on a house!

If I can be of any further assistance, please don't hesitate to contact me at http://www.HernandoLuxuryHomes.com - I'd be happy to help however I can!

Thanks,

-Josh
0 votes Thank Flag Link Wed Jun 18, 2008
there are many kinds of "pre-approvals." The one that is of most value is a "lender pre-approval" that is contingent only upon a contract and an appraisal.

The underwriter is the most important part of this equation. A full lender pre-approval will provide the best terms for the seller and if presented in the best light, make you the most preferred buyer should there be multiple offers on a property.
Web Reference: http://GailGladstone.com
0 votes Thank Flag Link Wed Jun 18, 2008
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