What’s the Difference Between Pre-Qualification and Pre-Approval?

Pre-qualification is an initial estimate of what you might be able to borrow based on self-reported financial information. It’s a quick first step but not a firm commitment from a lender. Pre-approval, on the other hand, involves a full review of your credit, income, and assets — providing a verified loan amount and strengthening your position when making offers.

In my experience, serious buyers should always aim for pre-approval before starting their home search. It shows sellers that you’re financially prepared and can move forward confidently, which often makes your offer more competitive.