How Is Conditional Approval Different from Pre-Approval?
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Applying for a mortgage can be a complex process. There are many terms and processes you must understand before actually being approved for a mortgage. Of these terms, conditional approval and pre-approval can be some of the most confusing.
With all of these extra steps in the process, it can be difficult to know when you’ve actually been approved. Familiarize yourself with the differences between conditional approval and pre-approval to ensure that you are completely aware of everything that comes into play when it comes to your mortgage.
What is Pre-Approval?
Compared to pre-qualification, pre-approval is more thorough and requires more documentation on the borrower’s part. All income will be verified via pay stubs and/or tax returns, your credit report will be run, and the loan application will be completed at this point. All of this information adds credibility to your pre-approval, as opposed to a pre-qualification, where proper documentation is not necessarily required.
A prequalification is more like a quick assessment that determines whether or not the borrower will be able to meet the qualifications required for a specific loan. A pre-approval is a careful review of your documents to determine if you will be pre-approved for your loan.
What is Conditional Approval?
Conditional approval is the highest level of approval that a borrower can receive, besides an actual contract. Compared to pre-qualification and pre-approval, conditional approval takes more time and documentation since it is essentially a loan commitment.
When it comes to buying a home, many sellers give preference to buyers who have this type of approval because there is a greater chance that their loan will close. In addition, the loan typically takes only about 15-20 days to close.
Apply for a Mortgage Today
Home Point Financial offers a wide range of loan programs fit for any financial situation. If you are currently in the process of applying for a mortgage, use our mortgage calculators to get a better idea of what lies ahead. Find your nearest branch and contact us today to get a quote and see if you qualify!