Pre-qualification by a mortgage officer is a simple procedure by which you get an opinion as to how much you qualify for and discover any obvious obstacles that might cause problems. It is a good idea, but it is not as thorough as pre-approval.

Pre-approval entails making a complete application, ordering the credit reports, verifications and everything for the borrower. The Mortgage Company will issue a commitment subject to a specific interest rate and points and the satisfactory appraisal when a property is located.

There is usually a time limit placed on pre-approval commitments. You’ll want to be ready to look at homes and make a decision after you receive your pre-approval commitment.

There are several distinct advantages to using the pre-approval program:

You look at the "right" homes that you can afford. You will not be disappointed by choosing a home that you may not be able to afford.

You save money when a seller is comfortable about tying up their home because the buyer has a definite loan commitment. This is one less contingency for the seller to be concerned with.

You close more quickly because in most cases, the thing that takes the most time is getting a mortgage. The credit reports and all of the verifications take time to be mailed out and returned.

You minimize trauma of not knowing whether or not you qualify.

For more information or to determine if you qualify for a home you wish to purchase, contact your lender. If you do not have a lender you may contact Larry Unger at NW Mortgage Group, Inc., 503-452-0001 ext. 219 or email Larry at lunger@nwmortgagegroup.com.

Free Annual Credit Reports can be accessed at www.annualcreditreport.com.