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Pre-Qual vs Pre-Approval?

When you start your journey towards buying a home, you'll likely encounter the terms "pre-approval" and "pre-qualification." While they may sound similar, they are, in fact, different steps in the mortgage process. Understanding these differences is crucial in navigating the home buying journey effectively. This post will explore what each term means and how they impact your home buying experience.

What is Pre-Qualification?

  • Overview: Pre-qualification is the first step in the mortgage process. It gives you an idea of how much you might be able to borrow based on basic financial information you provide to the lender.

  • Process: To get pre-qualified, you'll typically provide your overall financial picture, including your income, assets, debts, and credit score, to a lender. This can often be done online or over the phone.

  • Credit Check: Pre-qualification usually involves a soft credit check, which doesn't affect your credit score.

  • Outcome: You'll receive an estimate of the amount you might be eligible to borrow. Remember, this is not a guarantee of a loan.

What is Pre-Approval?

  • Overview: Pre-approval is a more involved process. It indicates a lender has vetted your financial background and is willing to lend you a specific amount of money.

  • Process: You'll complete an official mortgage application and supply the lender with the necessary documentation to perform an check on your financial background and current credit rating.

  • Credit Check: Pre-approval requires a hard credit inquiry, which may impact your credit score.

  • Outcome: Once this is all complete, you will have a better idea on what you can afford, what to expect, and a lot of your questions answered!

Key Differences

  • Level of Scrutiny: Pre-qualification is a quick, informal assessment, while pre-approval is a more thorough and formal evaluation of your financial standing.

  • Accuracy: Pre-approval offers a more accurate picture of what you can afford, as it's based on verified information.

  • Credibility with Sellers: Pre-approval can make you a more attractive buyer in the eyes of sellers, as it shows you're serious and financially capable of purchasing their home.

Why Both Matter

  • Early Planning: Pre-qualification can be a useful tool for early planning. It gives you a ballpark figure of what you might afford, helping to guide your initial home search.

  • Serious House Hunting: When you're ready to seriously look for a home, pre-approval becomes essential. It not only refines your budget but also strengthens your position when making an offer.


Understanding the difference between pre-qualification and pre-approval is key to a smooth home buying process. Start with pre-qualification to get an idea of your budget, and then seek pre-approval when you're ready to shop for homes seriously. This approach will put you in a strong position to make a confident and competitive offer on your dream home.

Call to Action

Ready to take the first step in your home buying journey? Contact us to get pre-qualified and start exploring your options. When you're ready to take it to the next level, we're here to guide you through the pre-approval process.


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