Questions to Ask About Mortgage Prequalification vs Preapproval

Lenders use the words prequalification and preapproval to mean two very different levels of commitment. Knowing which one you are getting — and which questions to ask — keeps you from confusing a rough estimate with a real offer.

What is the difference, exactly?

Prequalification is usually a quick, informal estimate based on information you provide yourself, often with only a soft credit check. It tells you roughly what you might be able to borrow. Preapproval is a deeper review: the lender verifies your income, assets, debts, and credit reports, and typically issues a conditional commitment letter stating the loan amount. Sellers take preapproval letters seriously; prequalification carries far less weight.

Questions to ask the lender

Start with the basics: Which one am I getting — prequalification or preapproval? Then ask: Will this require a hard credit inquiry? Prequalification often does not, while preapproval usually does. Ask how long the letter is good for (commonly 60 to 90 days) and what could change the terms — a job change, new debt, or a large deposit can all force a re-review.

Questions about the letter itself

Ask whether the preapproval is conditional and what the conditions are — most are conditioned on appraisal, title search, and final verification of your documents. Ask whether the rate is locked or floating; many preapproval letters state an amount but not a rate, and the rate you eventually get depends on market conditions at lock time.

Questions about cost and exclusivity

Ask whether there is a fee for the preapproval and whether it is refundable. And ask whether getting preapproved obligates you to borrow from this lender — it does not. You are free to shop other lenders after preapproval, and the rate-shopping protections for mortgage inquiries apply when you do.

The bottom line

Get prequalified early to understand your price range, then get preapproved when you are ready to make offers. Keep the letter current, tell the lender about any financial changes immediately, and remember that final approval still depends on the property and your finances holding steady through closing.