What's the difference between prequalification vs preapproval?

Pre-approval means the bank or lender has actually approved you for a mortgage based on a detailed examination of your finances. It is a conditional commitment, in writing, for a specific loan amount.

Pre-qualification, however, is simply a first step that shows what kind of loans you could be approved for, based on a few ballpark details. They’re both important steps in the process, but pre-approval is more concrete. It shows that lenders have already scrutinized several data points about your financial health, and decided you would be suitable for a loan.