** In case you cannot view this video here, please click the link below to view “Is Your Buyer Qualified to Purchase Your Pleasanton Home?” on my YouTube channel: http://youtu.be/cUaOy4aKiZI **
00:09: Hi, this is Doug Buenz with the 680 Homes Video Channel. Today we’re going to talk about the difference between pre-approval and pre-qualification for home buyers.
Everyone wants to make sure the buyer for their property is qualified to purchase and it’s basic real estate. But there is a distinct difference between the two methods: pre-approval and pre-qualification.
00:32: A pre-qualification is basically a statement by a lender, quote and quote, lender. That the buyer appears to be qualified to purchase your property. You need to consider who the lender is that’s giving this opinion that the buyer is qualified to purchase your home.
Generally, pre-qualifications do not incorporate a full review of credit, full verification of employment and down payment. This is a half measure in many instances and a smart, savvy listing agent will want to see a stronger evidence that the buyer is qualified. That’s where we get into the pre-approval process.
01:13: Now a pre-approval is an actual statement by the lender that they verified their income, their assets, their credit, and their employment. They basically have done a thorough investigation of the buyer and based on those factors, the buyer is pre-approved for an (x) amount of money at an (x) interest rate.
So, as a seller and as an agent that’s a much stronger statement about the probability that this buyer is going to be able to finance the property. However, the important thing here is who is the actual lender who’s the funding source?
01:48: So, if I’m the listing agent and I get a pre-approval letter, quote and quote, from Jim’s mortgage company, I will ask, “Please forward us the actual pre-approval document from the bank that’s doing the loan” – Wells Fargo, Bank of America, Chase, etc.
Then you can be certain that the buyer has actually gone through the underwriting process and is definitely qualified to purchase the home based on the information at hand.
02:16: Either way it is very important and critical that you don’t take your home off the market for a period of time because you might find out that the buyer fails to qualify. So, the pre-approval process is a very important step that you as a seller need to make sure it’s authentic and reliable.
This is Doug Buenz, 680 Homes Video Channel.