Reviewed by Jeff Shin, NMLS #1041652. Updated .
Also called: preapproval letter, prequalification letter.
What the CFPB says
The CFPB explains that both terms refer to a letter saying the lender is generally willing to lend to you, up to a certain amount and based on certain assumptions. Some lenders issue a prequalification on unverified information you report, and a pre-approval only once they verify it. Others use the words the same way. The label alone does not tell you much.
Two questions to ask
- Did you pull my credit? A letter backed by a credit report holds up better than one built on an estimate.
- Did you verify my income and assets? Pay stubs, W-2s or tax returns, and bank statements are what make a letter hold up in underwriting.
A seller’s agent will often call the lender to ask the same things. More on what a pre-approval checks.
Shopping without hurting your credit
Per the CFPB, multiple credit checks from mortgage lenders within 45 days show up on your credit report as a single inquiry. You can get letters from more than one lender inside that window. Keep in mind that a letter is not a loan commitment. The approval can still change if your income, debts, or credit change before closing: pre-approved isn’t payment-approved.
Related terms
Related on BankPricer
Sources
Definitions on this page are summarized from the agencies that set the rules. Lenders can add stricter requirements. Checked October 7, 2026.
Not sure which of these applies to you?
That is usually the actual question. Send the situation rather than the product name — purchase or refinance, primary or investment, price range, and timeline — and you get the structures that fit, with what each one costs.