Mortgage pre-qualification is an informal estimate of how much you might be able to borrow based on basic financial information you provide. Mortgage pre-approval is a formal offer from a lender stating how much they’re willing to lend you, based on a full credit check and income verification.
In Alberta, understanding the difference between these two steps can make or break your homebuying journey—especially in competitive markets like Calgary, Edmonton, or Lethbridge.
What is Mortgage Pre-Qualification?
- No credit check required
- Based on self-reported income, debts, and assets
- Gives you a ballpark estimate of what you may qualify for
- Takes minutes to complete online or over the phone
- Not binding—lenders aren’t committed to lend that amount
Think of pre-qualification as a first glance at your borrowing potential.
What is Mortgage Pre-Approval?
- Requires a credit check and proof of income (like pay stubs or T4s)
- You’ll complete a mortgage application with a lender or broker
- You receive a conditional commitment for a mortgage amount
- Often includes a rate hold (for 60 to 120 days)
- Stronger when making offers—sellers take you more seriously
Pre-approval is a real financial green light from a lender.
Why It Matters in Alberta
- In cities like Calgary and Edmonton, homes can move fast—pre-approval gives you an edge when making an offer.
- In rural or smaller communities like Lethbridge or Red Deer, sellers may not demand pre-approval, but it still helps you budget realistically.
- Alberta’s market has no land transfer tax, but you’ll still face closing costs—so knowing your true approval amount prevents surprises.
Final Thought
If you’re just starting to think about buying a home, pre-qualification is a helpful first step. But if you’re serious and ready to shop, getting pre-approved gives you clarity, credibility, and confidence in your budget.
Need help getting pre-approved? Speak to a licensed mortgage broker in Alberta who can guide you through the process and help you understand your best options.
