Pre-approval takes 1-3 business days and proves to sellers you're a serious buyer with verified income and credit. You'll provide financial documents and get a pre-approval letter showing your max borrowing amount. Pre-approval is free and doesn't obligate you to borrow.
What you need to apply
Photo ID, Social Security number, last 2 months bank statements, last 2 years tax returns, recent W-2s or job offer letter, current pay stubs, list of debts (credit cards, student loans, car loans, mortgages), employment history (2 years), and asset documentation. Self-employed: 2 years of business tax returns and profit/loss statements. Rental income: lease and bank deposits.
The pre-approval process
Step 1: Contact 3-4 lenders (online, bank, or mortgage broker). Step 2: Provide documents. Step 3: Lender verifies employment, pulls credit report, verifies assets. Step 4: Underwriter reviews everything. Step 5: You receive pre-approval letter within 1-3 business days. Letter states max loan amount and conditions (appraisal, no new debt, employment verification).
Pre-approval vs pre-qualification
Pre-qualification: informal estimate based on what you tell the lender (takes 10 minutes). Pre-approval: verified (credit pull, income verification, asset check). Pre-approval carries weight with sellers and real estate agents. Always get pre-approval before house hunting; pre-qualification is just a starting point.
How long does pre-approval last?
Typically 60-90 days. Some lenders extend to 120 days. If your situation changes (job loss, new debt, credit score drop), lender may revoke pre-approval. Once you find a home and make an offer, you move to full mortgage application (60-90 days to close).
Does pre-approval affect your credit?
Hard inquiry from credit pull costs 5-10 points. Multiple pre-approval inquiries within 14 days count as one (rate-shopping protection). Points recover in 3-6 months. Impact is minor and temporary; don't hesitate to shop multiple lenders in a short window.
Frequently Asked Questions
Is pre-approval a loan offer?
No—pre-approval is a pre-approval letter showing you can borrow up to a certain amount, subject to appraisal and other conditions. You still need final underwriting and appraisal when you make an offer.
Can I increase my pre-approval amount?
Yes—if your credit improves, you pay down debt, or your income increases, request a new pre-approval. Lender will re-verify income and re-pull your credit.
Should I shop multiple lenders?
Yes—rates vary 0.25-0.5% between lenders. Get pre-approvals from at least 3; compare rates, fees, and terms. All inquiries within 14 days count as one for credit scoring.
Can I be denied after pre-approval?
Yes, if: you lose your job, you max out new credit cards, your credit score drops significantly, or the home appraisal comes in low. Conditions in the pre-approval letter must be met.
What if my financial situation changes during pre-approval?
Tell your lender immediately. New debt, job loss, or income reduction can trigger denial or require re-underwriting.