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Pre-qualified? What is that?
Pre-qualified? What is that?

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Let’s say that you have been looking at homes through a Multiple Listing Service (MLS) or a magazine and you want to start checking out homes. You call a Real Estate Agent and at some point they say, “Are you pre-qualified?” If you’re not familiar with the term, this may throw you for a loop! If that’s the case, this article is here to help.

What Does Pre-Qualified Mean?

In order to start the home loan application process, you’ll need to talk to a lender first. A real estate professional is your best bet if you’re in need of recommendations. We recommend that you contact a loan representative that works directly for a mortgage company or mortgage broker.

Why Do You Need to be Pre-Qualified?

Most real estate agents consider themselves to be separate entities from lenders and will not try to do the job of one. In the real estate field, true professionals understand the need for cooperation when trying to successfully close a transaction. A tri-merge credit check, done through a lender, is typically required before a real estate agent can show you a home. These credit reports typically cost under $25. The credit report does exactly what it says: report on your credit history and “grading” it with three FICO scores. The middle score is normally the one used by the lender.

You will also need to start the loan application. There are many loan programs available, and it’s up to the loan representative to explain them to you. It’s at this point that you’ll learn how costly of a home you’ll be able to buy. Be sure you get a “good faith estimate” which shows the costs of the loan and your approximate monthly payment from the lender. This will help your agent structure the costs and financing of your Residential Purchase Contract.

If you are in the state of Arizona, your lender will also complete the Arizona Association of REALTORS® form called the “Pre-Qualification Form” (Pre-Qual), which must accompany the Residential Purchase Agreement. The Purchase agreement is the most important document, but the Pre-Qual is the one item that allows the sale to be accepted or for the seller to make a counteroffer. If you do not submit a completed Pre-Qual, there will be a total rejection from the seller. The Pre-Qual is prepared by your lender and is based on your application and credit report. Being pre-qualified is a very important step to take before you begin the search for your new home. Don’t forget to do it.

About the author:

Barry Fotheringham has been in the Tucson Real Estate Business for over 35 years. He holds the CRS, GRI, and e-Pro designation with the National Association of REALTORS®. He is the Broker of his family owned business, Ability Realty.


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  • Ability Realty, Real Estate, Tucson, AZ
  • housing
  • realtor
Contact Us
Ability Realty
Barry Fotheringham, Broker
7360 E. 22nd Street,
Tucson, AZ 85710
520-296-7143