You've done your homework and contacted a mortgage company to get pre-qualified. That part of the process is finished, and you can concentrate on finding a home and moving...or can you?
Pre-qualified and pre-approved are actually two different things, but some people, including some in the business, use the terms interchangeably. Pre-qualified is an opinion of the likelihood that a borrower will be approved based on preliminary information about their income and credit. Whereas, in a pre-approval, the borrower's credit report is updated and pulled, income and assets verified, and involves pre-underwriting.
Even when you have a highly qualified loan officer, the real decision-maker is the underwriter. Generally speaking, a person who has been pre-approved receives a written letter stating the terms and conditions of the commitment.
A second opinion from a different lender can be a comforting thing for a borrower. It will either confirm that the first lender was correct and that the rate and terms are competitive, or it will reveal that there may be differences that warrant more investigation.
Mortgage money is a commodity, and while competition usually keeps lenders close to each other in the rates and terms they offer, you won't know for sure unless you shop around. The cost to be pre-approved is usually a nominal amount, and when you consider the size of the mortgage and that you'll be borrowing for up to thirty years, it makes sense to get a second opinion.
Occasionally, during the process of being pre-approved, an unexpected credit problem may be discovered. It's better to learn about it early, so you'll have time to correct it before you have contracted on a home.
We are happy to recommend lenders who are active and experienced in Northwest Arkansas. In the end, the benefits far exceed the time and effort it takes. You'll be looking at the right priced homes; getting the best loan, rate, and terms; have increased negotiating power with the seller and can close quickly because many of the verifications have already been made.