Pre-qualified only means that a lender had a brief discussion with you over the phone and thinks that with your salary you could qualify for a loan of “x” amount. But the lender hasn’t seen your credit report and doesn’t know if you have the necessary savings for the down payment required by any particular loan. The lender has not approved a loan for this amount, because they have not reviewed your credit history.
Once you have settled on a reputable lender, take the extra step to get pre-approved for the loan you want. This may mean that you pay the loan application or underwriting fee and allow access to your credit report. None of the other fees will be charged until you actually find the house you want to buy and lock in your mortgage amount and interest rate.
A pre-APPROVAL letter is a powerful tool. Not only will it help you direct your search to properties you can actually afford. It may also make your offer more attractive to the seller than someone else who can only show they have been pre-qualified. “Pre-approved” means that your lender knows for sure that you can get the loan for up to “x” amount. Generally, a full-price offer from a buyer who is pre-approved is more attractive to a seller than one from a buyer who is only pre-qualified. If all other things are equal, the pre-approved buyer has the advantage of removing the seller’s uncertainty about whether the buyer will qualify for the loan they need to purchase the property.