Mortgage Pre-Approval

A mortgage pre-approval is a lender's conditional commitment to lend you a set amount at a held rate for a set period, subject to verification of your income, debts, down payment, and the property you eventually buy. It is a written indication of how much a lender is prepared to advance, not a final approval and not a guarantee of funds.

Pre-approval versus pre-qualification

The two are often confused. A pre-qualification is a quick, informal estimate, usually based on figures you supply yourself, and it may involve only a soft credit check. A pre-approval goes further: the lender typically pulls your credit history, reviews pay stubs, notices of assessment, or other proof of income, and runs your numbers through its underwriting model. Because more is checked, a pre-approval carries more weight with sellers than a pre-qualification does.

What the rate hold does, and does not, cover

Most pre-approvals include a rate hold, meaning the lender holds a specific rate for a defined window, typically a few months from the date of issue. If rates rise before you buy, you generally keep the held rate. If rates fall, many lenders will instead give you the lower rate at closing, though not all do. The hold usually applies to a specific mortgage product, term and amortization, so a change in any of those can change the rate.

Why it matters when you make an offer

A seller reading an agreement of purchase and sale wants confidence that the buyer can close. A pre-approval supports that, but it stays conditional. Final approval depends on:

the property passing the lender's appraisal and title review;
your financial situation remaining unchanged — no new car loans, credit cards or job changes;
the mortgage still fitting the lender's GDS and TDS limits and the federal mortgage stress test.

A pre-approval is also a budgeting tool, since it shows the payment tied to a given rate before you shop. For a step-by-step walkthrough of documents and timing, see the guide on getting a mortgage pre-approval in Canada.

Frequently asked questions

Does a mortgage pre-approval guarantee I will get the mortgage?

No. A pre-approval is conditional. Final approval depends on verifying your income and down payment, a satisfactory appraisal and title review of the property, and your finances staying essentially the same. Taking on new debt, changing jobs, or buying a property the lender will not accept can all void it.

How long does a mortgage pre-approval last in Canada?

Lenders set their own expiry, usually a fixed window of a few months from the date of issue. When it lapses you can ask for a renewal or apply again at current rates. Ask your lender to confirm the exact expiry date and the conditions in writing before you rely on it.

Does a pre-approval hurt my credit score?

A pre-approval normally involves a hard credit inquiry, which can cause a small, temporary dip. Rate shopping within a short window is generally treated as a single inquiry by scoring models. A pre-qualification, by contrast, often uses only a soft check that does not affect your score.