The Terms “PreQualified” and “PreApproved” Explained

The Terms “PreQualified” and “PreApproved” Explained

In the Northwest Arkansas market homes are selling fast. 

According to, on average, 34 people per day are being added to our population.

So what does that mean for the market?
1) It ‘s a seller’s market. Not only are homes being sold over asking price, but sellers are getting their pick of the litter with multiple offers so the cards are in their hands.

2) There are more buyers than there are sellers. There are more people looking for a home to buy than there are homes on the market.

I recently had a buyer that saw a house hit the market. They called me.  We toured it. They put in an offer. Their offer was accepted the same day. The house was only on the market for a few hours.

If you are ready to buy a house you need to have all your ducks in a row. Sellers are usually looking to sell quickly, and having a “PreQualification” Letter or “PreApproval” Letter will let them know you are serious about buying.

So how do you get this letter? You will need to find a mortgage lender (ask me if you need recommendations) and tell them what your plans are.

But, are “PreQualified” and “PreApproved” the same thing?

They’re actually different.

“PreQualified” isn’t as lengthy of a process and requires less information to obtain.
You could speak to a lender, let them know what your job is, let them do a soft pull on your credit and income, and they will be able to get you a “PreQualification” Letter.

Being “PreQualified” is a lender saying they believe you will be able to purchase a home for X amount.

“PreApproved” is a more accurate measure of your finances and what you can afford. It’s a better indicator, letting you know your mortgage loan will be good to go. “PreApproval” requires an in depth look at your finances, your credit report, bank statements, letter of income, debt to income ratio, your down payment, etc.

In this market you need at least one of these to make an offer on a home.

Which one you obtain is up to you. Most Lenders prefer the “PreQualification” letter because it takes less time, but a “PreApproval” letter means more to the seller when looking at multiple offers.  You may need to push for the “PreApproval” letter.

Just remember, a “PreQualified” does not mean “PreApproved.”

If you’ve got questions, ask me! I can help you decide which to go for and if you have any questions for which lender to choose.  Call or text me, Jill Bell, at 479.799.3023.

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