Pre-Approval
A mortgage pre-approval is a lender's conditional commitment to loan you a specific amount, based on a verified review of your credit, income, assets, and employment. Pre-approval is stronger than pre-qualification because the lender has actually reviewed your documents. Sellers take pre-approval letters seriously as evidence you can close.
To get pre-approved, you submit a full mortgage application along with supporting documents: pay stubs (last 30 days), W-2s and tax returns (last 2 years), bank statements (last 2–3 months), and identification. The lender pulls your credit report (a hard inquiry) and reviews everything before issuing a pre-approval letter. Getting pre-approved directly through a direct lender—rather than through a broker—means the underwriting team reviewing your file is the same one who will approve your final loan, which can add weight to your letter in the eyes of sellers.
A pre-approval letter specifies the maximum loan amount you qualify for, the loan type, and the expiration date (typically 60–90 days). In competitive markets, sellers may not consider offers without one. Having a pre-approval letter from a reputable lender can be as important as your offer price.
Important caveats: pre-approval is conditional, not a guarantee. Final approval happens during underwriting after you make an offer on a specific property. The appraisal must support the purchase price, and nothing about your finances can change materially between pre-approval and closing—no new credit cards, large deposits, job changes, or major purchases. Many deals fall apart because buyers didn't understand this.
Key Takeaway
A mortgage pre-approval is a lender's conditional commitment to loan you a specific amount, based on a verified review of your credit, income, assets, and employment. Pre-approval is stronger than pre-qualification because the lender has actually reviewed your documents. Sellers take pre-approval letters seriously as evidence you can close.
Related Terms
Frequently Asked Questions
Pre-qualification is a quick estimate based on self-reported information with no document review. Pre-approval involves verified income, assets, and a credit pull—it's a much stronger indicator that you can qualify for a loan.
A pre-approval requires a hard inquiry, which may temporarily lower your score by 2–5 points. Multiple mortgage inquiries within a 14–45 day window count as a single inquiry, so shopping multiple lenders has minimal impact.
Most pre-approval letters expire in 60–90 days. If yours expires before you find a home, your lender can typically update it by reviewing recent pay stubs and a new credit pull.
Compare Mortgage Rates Today
Now that you know what pre-approval means, see how it affects your bottom line.
See Rates →