Pre-Qualification
Pre-Qualification, (or pre-qual ) is just a quick determination of what you’d likely qualify for if you made an offer and applied for a home loan.
It’s not necessarily a waste of time, but it’s not going to get you very far. You can liken it to running a few numbers to see where you stand, but it cannot be used in place of a pre-approval.
Pre-Approval
A mortgage Pre-Approval, on the other hand, is a written, conditional commitment from a bank or your mortgage lender (PRO TIP always go with a local company to save yourself time and headache, reach out to me for referrals) anyway the letter will say that you are pre-approved for the mortgage financing in question.
Pre-approval letter way more detailed and accurate, and shows the interested parties (sellers, agents) that you’re a committed home buyer, boosting your chances of sealing the deal at the price you want.
Once you provide all the required documentation and get the mortgage pre-approval letter from a bank or lender (will take couple of days at the most), it is typically valid for 60-90 days. Some lenders can lock your rates up to a yer but it will cost you some points.