It's one of the most popular questions I get.

"What's the difference between pre-approval and pre-qualification?"

Let's ask the experts!

Michael L. Moskowitz, president of Equity Now, says that pre-qualification means, "based upon income, asset, liability, and personal information a borrower has provided, a lender will indicate how much of a mortgage the borrower should be able to get at a particular interest rate."

Pre-approval is more serious.

With a preapproval, he said, the borrower submits a mortgage application to the lender – along with any required income verification information – and the lender runs a credit check on the borrower and processes the application. After that, the lender gives the borrower a written approval for the maximum amount of money the borrower qualifies for at a specific interest rate.

What's better? A pre-approval, of course. In fact, it's almost a rule that a pre-approval letter accompany any offer for a property.

So, do it now!

(Oh, and the answers to the other two most popular questions I get are, "When I was six years-old" and "Crisco".)

Source: Prequalification vs. Preapproval - By Jay Romano, The New York Times