How Are Pre-Qualifying And Pre-Approval Different? Watch this video and it\’ll make sense. Pre-qualification is an informal way to see how much you maybe able to borrow. You can be \’pre-qualified\’ over the phone with no paperwork by telling a lender your income, your long-term debts and how large a down payment you can afford. Without any obligation, this helps you arrive at a ballpark figure of the amount you may have available to spend on a house. Pre-approval is a lender\’s actual commitment to lend to you. It involves assembling financial records and going through a preliminary approval process. Pre-approval gives you a definite idea of what you can afford and shows sellers that you are serious about buying.