Pre-Approval
 |
Definition of 'Pre-Approval'An evaluation of a potential borrower by a lender that determines whether the borrower qualifies for a loan from the lender, or the maximum amount that the lender would be willing to lend. The pre-approval process involves a thorough look into the income and expenses of the borrower, including a look at the borrower's credit report and score. |
 |
Investopedia explains 'Pre-Approval'The pre-approval process involves a confirmation of income and a credit check on the borrower. As long as no major income or credit changes occur between the time of pre-approval and the actual purchase of a home, the dollar amount of pre-approval can be expected to remain the same. The process may take anywhere from a few minutes (for an online lending application) to a couple of weeks. A nonrefundable fee may be charged for the process.A pre-approved mortgage is still subject to review once a specific property has been chosen, so the dollar amount is not guaranteed. A pre-approval may be lowered or even revoked if the property in question may be difficult to resell in the real estate market due to preconditions, location and other factors. |
Related Definitions
Articles Of Interest
-
The Importance Of Your Credit Rating
A great starting point for learning what a credit score is, how it is calculated and why it is so important. -
Mortgages: How Much Can You Afford?
Answering this means number-crunching as well as factoring in other considerations and expenses. -
10 Worst First-Time Homebuyer Mistakes
These errors could wind up costing you more than the coveted key to your first home. -
4 Steps To Attaining A Mortgage
It starts with knowing your choices as well as your price range. We show you how to get there. -
Pre-Qualified Vs. Pre-Approved - What's The Difference?
These terms may sound the same, but they mean very different things for home buyers. -
6 Tips For Selling Your Home Fast
Find out what you can do to stand out from the competition and make your home an easy sell. -
5 Smart Ways To Use Your Tax Return
This year, find out how to stretch your tax refund further to strengthen your future. -
Common Liabilities That Hurt Your Net Worth
Every penny that you keep out of the liability side of the net worth equation essentially ends up on the asset side. -
The Dangers Of A Reverse Mortgage
In many circumstances, a reverse mortgage can be a risk to your financial security. Here are six dangers you should consider before signing on the bottom line. -
Automatic Cancellation Of PMI When You're Underwater On Your Mortgage
You might be suprised to learn that after reaching certain criteria, your PMI will be automatically cancelled.
Free Annual Reports
