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What does a preapproval actually tell you?
A mortgage preapproval gives you a starting point for your home search. Yesenia and her loan officer partner can help you request a free review and understand where you stand.
A potential borrowing amount
A lender indicates the amount it may be willing to lend based on its review and assumptions. This helps you set a search range. The loan amount is not necessarily your purchase price, and your comfortable budget may be lower.
How much the lender has reviewed
Lenders use “prequalification” and “preapproval” differently. Ask whether credit, income, debts, employment, and funds have been verified, and whether an underwriter has reviewed your file. The label alone does not tell you how complete the review is.
What is still needed to move forward
Ask your loan officer about outstanding documents, conditions, the letter’s expiration date, and possible loan options. If you are not ready yet, ask which issues need attention. Changes to your finances can affect eligibility.
Evidence of readiness for a seller
A preapproval letter can show a seller that a lender has considered your finances. It can support your offer, but it does not guarantee acceptance or require you to use that lender.
What it does not guarantee
Preapproval is not final loan approval, a guaranteed interest rate, or a complete cost breakdown. Final approval depends on lender requirements and the property. Ask about a rate lock separately. A Loan Estimate provides estimated loan terms, monthly payment, and closing costs so you can compare offers; receiving one is not loan approval.