Pre-qualification is an initial, informal assessment of a borrower’s potential mortgage eligibility, based on basic financial information provided to a lender or broker. It offers a rough estimate of how much a borrower might be able to take out for a mortgage but doesn’t involve a thorough credit check or document verification, and it’s not a loan guarantee.

Pre-approval is a formal process where a lender conducts a comprehensive review of a borrower’s financial background, including credit history, income, employment and financial documents. It results in a written commitment specifying the exact loan amount the borrower is pre-approved for and strengthens a buyer’s position when house hunting.

Is there a real estate term you need to be defined? I’m here to answer and advise  — reach out any time!