Pre-qualification
A lender's rough estimate of how much you might borrow, often based on information you report without verification. It is a starting point, not a commitment, and carries less weight with sellers than a pre-approval.
Also called: prequal, pre-qual, prequalified
Related terms
A lender's written statement that you qualify for a loan up to a certain amount after reviewing your credit, income and assets. Sellers usually expect one with an offer. Final approval still depends on the property and underwriting.
The bank, credit union or mortgage company that provides the loan money. The lender sets the rate and terms, underwrites the loan and holds or sells it after closing.
The person who helps you choose a loan, takes your application and guides it to closing. Loan officers must be licensed or registered through the NMLS.
A number, usually from 300 to 850, that summarizes how you have handled debt. Lenders use it to decide whether to approve a loan and what rate and mortgage insurance cost to charge.
Your monthly debt payments, including the new housing payment, divided by your gross monthly income. Lenders use it to judge whether you can carry the loan; each loan program sets its own limits.