There’s a common misconception among some homebuyers that if you’ve got a pre-approval, your mortgage is basically guaranteed.
But this isn’t always the case. Having a pre-approval doesn’t automatically mean the lender will fund your mortgage.
Below, we’ll explain what a mortgage pre-approval is and whether it’s worth getting one.
A mortgage pre-approval is a conditional approval granted by a lender based on a preliminary review of your financial situation and creditworthiness. While this preliminary approval usually requires a credit check, information about your debts and income are based on details you provide to your broker, which are then shared with the lender. A pre-approval is often based on that information alone, without the lender verifying the documents or knowing which property you’re going to buy.