The Term “Pre-approval” Can Be Misleading

The Term "Pre-approval" Can Be Misleading

Although going through the pre-approval process is more important than ever, pre-approvals are often misleading. Here’s why you should have the condition “subject to financing” included on your offer to purchase. 


  1. A lender must review all related documents, not just your documents but also those from the appraiser and the realtor. 
  2. Although your mortgage broker will review your documents, very few lenders will review documents until there is an accepted offer in place.
  3. The property itself must meet specific standards and guidelines.
  4. Anything can change with your finances between the initial pre-approval and the time you make an offer on a home. For example, the job you have today may not be the job you have by the time you write your offer.


A pre-approval provides you with a clear understanding of the maximum mortgage amount you qualify for, based on your financial picture today. When you make an offer on a house, ensure you include the condition “subject to financing.”

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