Pre-qualification and pre-approval are letters that show that a buyer is ready to purchase a home. Both of these letters empower home buyers to go out and look at homes in person with a real estate agent. Here’s the difference between the two.

Understanding Mortgage Pre-Qualification

A mortgage loan pre-qualification letter is a guarantee from a lending institution that a person is approved to buy a home. A pre-qualification is different from a pre-approval in that no written requirements exist. Still, many lenders will state that a pre-qualification is the weakest approval form.

Nowadays, some lenders may give you a pre-qualification letter without verifying your information first. However, this is not as strong of a signal to the seller as a pre-approval letter, which is based on verified information.

However, other lenders differentiate between the two terms. To them, a pre-qualification is based on a quick review of your financial information and does not require a thorough analysis of your credit history. On the other hand, a pre-approval is a more in-depth process that includes a credit check and verification of your employment and income.

A pre-qualification letter is not the same as a pre-approval letter, and lenders can sometimes be quick to provide a pre-qualification letter without fully investigating the buyer’s finances. If you reach out to the lender and they have not spent much time researching the buyer, it may be wise to ask for a pre-approval letter instead.

The lender should check the buyer’s credit score, bank statements, and tax returns to ensure they can get the loan. If the lender has not done this, the buyer may not be able to get the loan.

Understanding Mortgage Pre-Approval

A pre-approval letter states that the mortgage lender has reviewed the home buyer’s information and approved them for a home loan.

If you want to buy a home, you should get pre-approved for a loan before you start shopping. This way, realtors and home sellers will take you more seriously. Plus, having a loan already lined up will make the buying process smoother.

To buy a home using financing, you’ll need to prove to the seller that you’re qualified for a loan. The same goes for real estate agents—they won’t show you homes unless you can prove you’re qualified for a loan.

The mortgage lender will look at the buyer’s credit score, employment history, and income to ensure they can repay the loan. The lender will also look at the property to ensure it is worth the price the buyer is paying.

If you have concerns that the buyers’ lender has not fully vetted their client, you can ask your real estate agent to call and find out. It is a good idea to have your agent contact any mortgage company representing a buyer for your home sale.

Different lenders offer different levels of professionalism and efficiency when it comes to processing loans. Some lenders may be tough to work with, causing your transaction to fall apart, while others may be much easier to work with and make the process feel like a breeze. It is important to research lenders before choosing one to work with to ensure a smooth and successful transaction.


There are several key differences between a mortgage pre-qualification letter and a pre-approval letter. Because of these differences, it’s important to understand which one you need before beginning the home-buying process. If you’re serious about buying a home, it’s best to get a mortgage pre-approval letter.

Total Lending Concepts is your hometown mortgage lender, offering home loans to fit every situation. Whether you are a first-time homebuyer searching for your first home or ready to buy that dream home you’ve had your eye on, we’ve got you covered! Our wide variety of loan options includes conventional, VA, USDA, FHA, and other options to fit your needs. If you need mortgage in Colorado Springs, call us at 877-266-4138 to inquire today!