A home loan pre approval is a conditional commitment from a lender to provide a specific amount of financing for a home purchase. For instance, if you receive pre approval for a $250,000 loan, the lender has agreed to lend you that amount subject to certain conditions, such as a satisfactory appraisal and credit check.
Pre approval is an important step in the home buying process because it gives you a clear understanding of how much you can afford to borrow. This information can help you narrow down your search to homes that are within your price range. Pre approval can also make the closing process go more smoothly, as the lender has already done much of the underwriting work.
