Confused???

[Anonymous]

So last year, my husband and I decided to apply for a home mortgage loan. We have a friend whose wife is a realtor so we decided to use her and she recommended we apply for a mortgage through Bank of America. Well, the LO called, asked us a few questions over the phone, and about 1 hour later, we got a pre-approval letter and started looking for a house. Well, we ended up not purchasing. So, this time around, I met a really nice realtor at a friend’s housewarming party and decided to give it another go at this home buying stuff. The realtor recommended that we get “fully approved” first before looking at houses. My question is “fully approved” the same thing as “pre-approved”? We are using Cornerstone out of Denver CO. I have sent all required documents over and have not heard anything. It’s only been 2 days, but I am really nervous as it wasn’t like this the first time around.

Some background on us.

First time homebuyers

Budget: 290k-350k

Annual income (both): 105k

DP: $15k

Debt ( 1 student loan $332, 3 credit cards, 0 balances)

No baddies

Scores: Me (680), husband: (700)

[Heatherkins]

Sounds like you got a pre-qual the first time. Pre-approvals, when done with full documentation, take a bit longer. The LO actually verifies the info you give them through your documentation. If you did not submit documentation the first time, that was most likely a pre-qual and does not typically carry as much weight with borrowers. It took us 2 days to get a pre-approval with full documentation. 

Good luck! 

[frugalQ]

Technically, you can't get fully approved until you find a house and it gets appraised.

I think the realtor is talking about pre-approval. Meaning you've, at the very least, been through automated underwriting and gotten approved and gotten some sort of commitment letter.

Pre-qualifications are basically just stating that you meet the basic requirements (credit score, DTI) but there hasn't been an in depth look at you full profile with w2, tax returns, bank statements, etc.

[Anonymous]

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@frugalQ wrote:
Technically, you can't get fully approved until you find a house and it gets appraised.

I think the realtor is talking about pre-approval. Meaning you've, at the very least, been through automated underwriting and gotten approved and gotten some sort of commitment letter.

Pre-qualifications are basically just stating that you meet the basic requirements (credit score, DTI) but there hasn't been an in depth look at you full profile with w2, tax returns, bank statements, etc.

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+1

[Lemmus]

...I'd personally not work with a lender who only does a pre-qual ...I want to know that they know all my dings and warts and are still willing to work with me ...not going to say "OOPS!" after I've signed a contract because of something they should have seen early on but didn't take the time or effort to look ...only a real pre-approval does that ...doesn't mean there won't be an OOPs but it cuts the odds waaaaaay down imnsho ...hth

[Anonymous]

Uncle Lemmus pointed out-

."I want to know that they know all my dings and warts and are still willing to work with me ...not going to say "OOPS!" after I've signed a contract because of something they should have seen early on but didn't take the time or effort to look ...only a real pre-approval does that .."

Man that sucks when that happens.  Saw it happen to a few jokers around here.

[ezdriver]

Prequal vs preapproval

A loan officer can and will issue a prequal ... without any underwriter having reviewed the file.

My recommendation is to insist on an underwriter's preapproval and commit to doing what it take to get same. Unless an underwriter has reviewed a file, any prequal paper is a little more than a loan officer's opinion.

[Lemmus]

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@ezdriver wrote:

Prequal vs preapproval

A loan officer can and will issue a prequal ... without any underwriter having reviewed the file.

My recommendation is to insist on an underwriter's preapproval and commit to doing what it take to get same. Unless an underwriter has reviewed a file, any prequal paper is a little more than a loan officer's opinion.

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...couldn't agree more ez ...the thing is, we know the difference ...but I had a LO give me a letter that said I was "preapproved" for $xxxxxxxxx and he'd done nothing but ask me a few questions over the phone ...my current lender pulled my CRs and asked for my bank statements and pension/ss verification letters before I got a preapproval letter ...which is a major reason why I'm working with her and not him 

[frugalQ]

We, as consumers (especially those of us who have past credit issues or fairly complicated files), probably should start asking for conditional approval letters or commitment letters....I've learned that these are the letters that are given after the underwriter has reviewed the file.

[Anonymous]

Hi everyone!!! Just an update! Everything went well, we're approved and start house hunting on Monday!!! Thank you! Abbie