Mortgage Pre-Approval vs Pre-Qualification

Which is best for you?

Ready to begin the home buying process, but not sure where to start? You may have heard the terms pre-qualification and pre-approval, but aren’t quite sure of the difference between the two. Maybe you’re unclear on which one comes first and whether or not you need to go through both processes.

We’re here to demystify pre-qualification vs. pre-approval. Here’s what you need to know.



Think of a pre-qualification as a financial “snapshot” that provides an idea of the mortgage for which you might qualify. More informal than a pre-approval, a prequalification is based on the information you provide to your lender. Prequalification does not require pulling your credit report or going through the underwriting process, but it’s important to know it is not a promise or commitment. A prequalification is useful primarily when trying to determine the mortgage amount your current financial position can support.


A pre-approval is more formal than a prequalification and takes you one step further in the home buying process. A pre-approval letter from a lender states that you qualify for a specific mortgage amount based on an underwriter’s review of your financial information including your credit report. It’s important to note that having your credit report pulled may temporarily lower your credit score; you may want to limit other activities that will prompt a credit pull during the pre-approval process.
If you have any questions or need further assistance, you can always speak to a mortgage expert at 978-573-1420 or reach out to one of our mortgage originators.