What's the difference between pre-qualified and pre-approved?

Short answer

Pre-approval is the real thing; pre-qualification is just an estimate.

Full answer

The way I like to explain it to people: pre-qualification is a quick estimate based on what you tell a lender. Pre-approval is the real thing. A lender pulled your credit, verified your income, and you have a letter saying you're good for a certain amount.

In this market, sellers want to see that pre-approval. But here's the part that's really for you: getting pre-approved means you find out early whether there's anything that could get in the way of your approval, so there are no skeletons in the closet later. Better to know before you fall in love with a house than after.

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