Pre-approval
A lender's conditional commitment to lend up to a certain amount based on a review of your finances, stronger than a pre-qualification.
What does pre-approval mean?
A pre-approval is a lender conditional commitment to lend up to a set amount after reviewing your income, assets and credit — a real step beyond a back-of-envelope pre-qualification. It tells you the price range you can shop in and signals to sellers that your offer is serious. It is not final approval, though: the property still has to appraise and underwriting has the last word.
Pre-qualification vs. pre-approval
| Pre-qualification | Pre-approval | |
|---|---|---|
| Based on | What you tell the lender | Verified documents |
| Credit check | Often soft or none | Hard pull |
| Weight with sellers | Low | High — shows you can close |
| Typical validity | — | About 60–90 days |
What to gather, and how to shop
- Pay stubs covering the last 30 days and W-2s for the last two years (tax returns if self-employed).
- Two months of bank and investment statements, with an explanation for any large deposits.
- ID, Social Security number and details of current debts and housing costs.
- A gift letter if a relative is helping with the down payment.
Getting pre-approved by several lenders does not multiply the damage to your credit: scoring models treat mortgage inquiries within a short shopping window — 14 to 45 days depending on the model — as a single inquiry.
Frequently asked
What is the difference between pre-qualification and pre-approval?
Pre-qualification is a rough estimate based on figures you state; pre-approval is a lender’s conditional commitment after actually reviewing your income, assets and credit. Pre-approval carries far more weight with sellers and gives you a reliable price range.
How long does a mortgage pre-approval last?
Usually 60 to 90 days, because your credit and financial snapshot go stale. If your home search runs longer, the lender can refresh it by re-pulling credit and updating your documents.
Does pre-approval guarantee a loan?
No. It is conditional — the home still has to appraise, and underwriting must clear your final documents. Big changes before closing, like new debt or a job change, can also put approval at risk.
Put it to use
Related terms
All glossary terms