Lenders use both terms, and they mean different things. I’m not a lender, so please confirm details with a licensed lender, since requirements vary.
Pre-qualification
Generally a quick estimate of what you might be able to borrow, based on information you provide. It’s a helpful starting point.
Pre-approval
Generally a more detailed review, where the lender looks at documents such as income and credit. Sellers often take a pre-approval letter more seriously when they consider an offer.
Why it matters
Knowing your budget before you search saves time and helps you act when the right home appears. Neither one is a final loan commitment.
Starting your search? See how I work with buyers.
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