Prequalification

Business / Taxes / Prequalification: When you prequalify for a mortgage, the lender calculates the approximate amount you’d be able to borrow, based on your current income and debt. Many lenders offer free mortgage calculators — sometimes called prequalification calculators — on their websites to help you estimate how large a mortgage you’d be approved for. Since you don’t complete a mortgage application or provide financial details, prequalification is not a guarantee, and simply helps you determine how much you should plan to spend on a home. But before you’re approved for a mortgage, you’ll have to go through the mortgage application process, including a credit check, and provide financial documentation.

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