Loan Approvals
Terms you need to know and understand as a Seller:
Pre-Qualification:
This is an informal and the most common way most lenders use to show you how
much you how much a Buyer MAY be able to borrow. This can be very
helpful in determining the amount of payment and how much of a loan the Buyer
MAY qualify for based on he verbal information the Buyer has supplied
to the lender.
Pre-qualifications are not lender commitments:
Buyers have not been approved by the lenders underwriters:
Buyers are subject to market interest rate fluctuations:
Verbal information to lender has to be verified by documentation:
Pre-Approval:
This is a commitment from the lender to lend you a stated amount of money
based on *stated conditions:
Pre-approvals are subject to market interest rate
fluctuations and interest rates
cannot be locked in until you have an accepted contract to purchase a property.
Stated Conditions: normally are subject to the lenders approval of an accepted and fully executed sales contract, an acceptable preliminary title report and appraisal of subject property.
Don't be deceived by these forms, neither one means it is a done deal, re-read "Stated Conditions" and also read Paragraph 4 (Financing) of the Sales Contract for further information.
