Loan Pre-Approval vs. Verified Approval

A pre-approval is a process in which a lender reviews your financial information and provides you with an estimate of the amount that you may be able to borrow for a mortgage loan. During the pre-approval process, a lender will usually review your credit score, income, debts, and employment history to determine your ability to repay a loan.

Getting pre-approved for a mortgage loan can be an important step in the home buying process, as it gives you an idea of what you can afford and helps you make more informed decisions when shopping for a home. Additionally, having a pre-approval letter in hand can make you a more competitive buyer in a seller's market, as it demonstrates to a seller that you are serious about purchasing a home and have already taken steps to secure financing.

It's important to note that a pre-approval is not the same as a full mortgage approval, and that the final loan approval will depend on the property being purchased and a full underwriting review of your financial information. However, a pre-approval can give you a good idea of what to expect and can help streamline the mortgage process once you have found a home that you would like to purchase.

A pre-approval and a verified approval are two different stages in the mortgage loan process.

A pre-approval is an estimate of the amount that you may be able to borrow for a mortgage loan, based on a preliminary review of your financial information. During a pre-approval, a lender will usually review your credit score, income, debts, and employment history to determine your ability to repay a loan.

A verified approval, on the other hand, is a more comprehensive and in-depth review of your financial information that is conducted after you have made an offer on a property. During a verified approval, the lender will usually verify your income, employment, and assets through official documentation, and will also review the property you have made an offer on to ensure that it meets the lender's guidelines.

In summary, a pre-approval is a preliminary estimate of your borrowing power, while a verified approval is a more comprehensive and detailed evaluation of your financial information and the property you are interested in purchasing. A verified approval is a necessary step towards final loan approval and closing on a mortgage loan.