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Does A Mortgage Pre-Approval Affect Your Credit Score?

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A mortgage pre-approval affects a home buyer’s credit score. The pre-approval typically requires a hard credit inquiry, which decreases a buyer’s credit score by five points or less.

A pre-approval is the first big step towards purchasing your first home. It increases your chances of having your offer accepted and provides you with a detailed quote to use for your budgeting.

As an integral step of the home buying timeline, it’s essential to understand how a pre-approval differs from a pre-qualification assessment and why it requires a hard inquiry instead of a soft inquiry.

Let’s dive into these differences so you can make the best decisions when buying your first home. Here’s how a mortgage pre-approval can affect a credit score.

Is Pre-Approval a Hard Inquiry?

Yes, a pre-approval is a hard inquiry. Applying for a pre-approval through a mortgage lender is a standard step in the mortgage approval process because it involves lenders looking at more detailed information.

Because lenders give loans for large amounts of money, hard inquiry credit checks are routine.

What’s The Difference Between a Hard and a Soft Credit Inquiry?

A hard inquiry is when a lender checks your credit because you applied for a loan. A soft inquiry occurs without a loan application, like when companies send you promotional offers.

Soft inquiries don’t affect credit scores. Hard inquiries will decrease your credit score by five points or less and are only affected for a few months.

Soft credit inquiry: Soft inquiries don’t impact your credit score. An example of a soft inquiry is an employer conducting a financial background check on a potential new employee candidate.

These inquiries don’t submit a new credit application, as they are just looking at your overall credit score. You can perform a soft inquiry and look up your credit score.

Hard credit inquiry: When an individual pursues an application for a new loan or line of credit, the lender performs a more in-depth assessment. This assessment looks at the buyer’s credit score and credit report to determine if they’re suitable for the credit or loan request.

This comprehensive assessment looks at an individual’s credit history reported by the three main credit bureaus, Equifax, TransUnion, and Experian

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How Long Will a Pre-Approval Impact Your Credit Score?

Because pre-approvals are hard inquiries that impact a home buyer’s credit score, they can stay visible on their credit reports for up to two years, according to Experian.

Your credit score is one of the most important factors a lender considers. Your lender accesses the score and documentation through credit bureaus.

However, the impact on a home buyer’s credit score declines as time passes, and the hard inquiry becomes less relevant.

Depending on a home buyer’s financial history, a few points can impact their credit score. However, many variables make up a home buyer’s creditworthiness and can influence the impact of the inquiry.

Learn more about buying a home, even if you have bad credit.

How Does Mortgage Pre-Approval Work?

A pre-approval works by using verified information to approve you, as a buyer, for a mortgage loan. Learn more about how to get a mortgage pre-approval.

You should always contact a lender to see what loan amount you can qualify for before house hunting.

A mortgage expert will review your financial documents and use the information to determine what you are eligible for, go over your loan options, and provide a detailed estimate, including interest rate, closing costs, and your monthly housing payment.

All the information they review in the pre-approval process determines the mortgage amount and interest rate you qualify for currently.

The pre-approval reviews details like:

  • Credit score
  • Credit history
  • Monthly debt payments
  • Bank statements
  • Pay stubs
  • Tax returns
  • Housing payment history

Your pre-approval typically lasts for 90 days. The mortgage and interest rate they provide give you a reliable amount to work with for your house hunting. It enables you to forecast your mortgage payments and accurately calculate the maximum property value you want to afford.

Get pre-approved for a mortgage today.

What’s the Difference Between Pre-Approval vs. Pre-Qualification?

A pre-approval uses verified information to approve you, as a buyer, for a mortgage loan. A pre-qualification doesn’t.

A pre-qualification uses estimates, not verified information. It’s a non-verified estimate of how much a home buyer can qualify for and gives the home buyer an estimate of the interest rate they will be paying on their mortgage.

A pre-approval is when a lender verifies your information and approves you for a mortgage. After completing a pre-approval, you receive a formal document that confirms the mortgage size and interest rate you can obtain from your lender. 



Shows affordability at one point in time Good for 90 days
Provides an early estimate of mortgage affordability Provides written commitment of mortgage affordability
Quoted based on self-attested estimates Quoted based on accurate and verified information
Answer questions about your financial situation Submit documents proving your financial situation
Self-reported credit score Hard credit inquiry

Learn more about the difference between pre-qualification and pre-approval.

Banks, credit unions, and other lending institutions take precautions before lending money. Lenders pull credit reports to assess an individual’s present and historical financial behavior. These assessments divide into categories known as soft inquiries and hard inquiries.

Get pre-approved before you start house hunting.

Our Advice – A Pre-Approval is Worth It

There are clear advantages when getting a pre-approval as a home buyer. After the pre-approval process, you’ll receive a conditional commitment for a specified loan amount and mortgage rate.

This pre-approval letter shows home sellers that you are a qualified buyer that can afford to purchase their home. Sellers know this and will rarely take an offer seriously if you don’t also provide a pre-approval letter. So, if you are serious about making an offer on a home, a pre-approval is a must.

Being able to set an accurate budget is another advantage of getting pre-approved. When you know the mortgage amount you are qualified to obtain from a lender, you can make more accurate decisions on which homes you want to afford and see in person. Knowing your mortgage amount, down payment, and monthly payments up-front is an integral part of the house-hunting process.

If you have more questions about mortgage pre-approval or want to discuss the best mortgage option for you, connect with us in the chat. Our mortgage experts are always available and ready to help.

Happy homebuying.

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