Prequalification

PIDB Encourages Applicants to First Pre-Qualify!

What is a prequalification?
Applying for a loan is more often than not a time-consuming process that involves a host of requirements and the provision of a number of supporting documents, but knowing what to focus on first can help you manage your time well. Understanding what you can realistically afford early on is key, and in addition to doing your own calculations, you may also want to know what we as a lender might conclude you can afford. That’s where a prequalification comes in. Simply put, to get prequalified, you are supplying us with some basic information about you, your income, and obligations to determine how much you may be able to afford to borrow.

This early determination helps you and us as lender get a better idea of your debt servicing ability. It’s important to remember that a prequalification is not an approval or a guarantee that your loan will be approved. Once required information for a pre-qualification is provided, a prequalification letter will be sent to you, which generally will
inform you of the following information:

  • Whether or not you qualify for the loan amount requested;
  • If ineligible for the amount requested, the amount you are eligible to apply for based on analysis of what you can afford in repayments;
  • What interest rate you may qualify for based on your preliminary data;
  • The term of loan you may qualify for based on your preliminary data; and
  • An estimate of your potential monthly payment.

Why might you need a prequalification?
Because the rest of your loan application process can take some time, it’s best to understand your financial parameters sooner rather than later. For instance, in the case of a residential home loan financing request, getting prequalified can help you devote your time to looking for houses and/or contractors in your price range. You can also
gain a sense of any areas that might need work, such as your credit, or perhaps reconsider and make adjustments to your financing needs accordingly.

With a prequalification, you can take the time to better understand what type of loan terms and conditions might be best for your financial situation. Information obtained from a pre-qualification can also be used to compare with other financing options you may intend to explore.

How do you get a prequalification letter?
To get a prequalification letter, visit the PIDB website at www.pacificidb.com to obtain the form and list of pre-qualification documents, complete and sign the Pre-Qualification Form and submit together with pre-qualification supporting documents (listed on the Pre-Qualification Form).

In terms of a time frame, getting a prequalification letter should be an early step that happens before you start a comprehensive application process involving the satisfaction of all requirements and the provision of all supporting documents on our application checklist. Once all pre-qualification requirements are met, an applicant should expect to receive a pre-qualification letter within three to five business days.