Two steps usually happen in the mortgage process: a pre-qualification and a pre-approval. A pre-qualification is the initial evaluation of the creditworthiness of the borrower to determine the estimated amount that the person can afford to borrow.
Pre-qualification is a relatively simple and quick process of examining the potential borrower’s income and expenses in order to generate an estimated borrowing range that they would likely be able to repay to the lender.
Pre-approval is the more in-depth assessment of the amount that a person can afford to borrow. This is done by the financial institution and it will state the maximum amount that it would lend to the borrower. See the Frequently Asked Questions and our loan checklists for the information you will need to provide, based on your type of loan.