A mortgage pre-approval is a lender’s conditional commitment to provide you with a home loan up to a specified amount based on a thorough review of your financial situation. During the pre-approval process, the lender evaluates your credit score, income, employment history, and debt-to-income ratio to determine how much you qualify for.

Unlike a pre-qualification, which is a rough estimate, a pre-approval requires documentation and provides a more accurate picture of your buying power. Having a pre-approval in hand not only helps you set a realistic budget but also shows sellers that you are a serious buyer, giving you a competitive edge in the market.