How Pre-Approved Loan Differs From Pre-Qualified Loan?

Do you know what pre-approved loan actually is? This loan is not being applied by individuals rather it is being offered by banks. These loans have got multiple forms and it is you who needs to decide which form to choose. You are absolutely free to choose the best form for yourself as the loan is being offered to you.

This loan has got the highest flexibility but for acquiring the same you have to maintain a genuine and healthy relation with your bank for a long time. These loans differ widely especially in terms of features and facilities from that of short term loans bad credit. In fact, people having poor-credit can never get the eligibility of availing these loans.

Is pre-approved loan different than pre-qualified loan?

There are many people who think that pre-approved loan is equivalent to pre-qualified loan but the reality is both are different from each other. There is a very thin line of difference in between them and the borrowers should understand the same before making application. Some commonest differences in between these loans are as follows:

• In case of pre-qualified loan, the eligibility of borrowers is being decided by lenders so that the perfect and legitimate loan-amount can be openly offered. Some commonest factors on the basis of which this qualification estimation is made are financial history, credit-score, earning capability and others. But in case of pre-approved loan, you can actually receive a guarantee of receiving a secured loan from your lender. This scenario needs to be understood well otherwise you will never be able to take the right decision that whether you are in need of a pre-approved loan or a pre-qualified one.
• Pre-approved loans are basically claimed on the basis of pre-approved certificates and these certificates are usually catered by banks. These certificates are usually issued only when the lenders are thoroughly satisfied with the borrowers’ current financial status and strength. An intricate verification or investigation is bung made by the sincere bank representatives for collecting enough of info about remuneration, employment and creditworthiness of borrowers. If the verification reports come positive then only the pre-approved certificate is handed over to the borrowers. No physical verification is involved in this case rather an online verification is being made with the use of special software. This customised software collects and accumulates all sorts of financial-data within seconds for the sake of preparing accurate verification-reports. But in case of pre-qualified loan this thing does not happen at all.

Pre-approved loan is now successfully taking the place of pre-qualified one in the loan-market. Almost all popular banks of the era have introduced this loan-scheme in order to grab the eyeball of maximum customers.

The decision of fixing loan-amount ultimately remains in the hands of the lenders. It might happen that you are having same financial performances in multiple banks but only few of them are offering you this loan-scheme. This scheme has now become much popular than that of instalment loans for bad credit UK.