What's the difference between Pre-qualification, Pre-approval and Full Loan approval?

Pre-qualification

Pre-qualification is the first step in obtaining the mortgage you need to purchase a home. It's very straight forward - an institution of your choice will examine your financial situation - income and liabilities in order to establish your borrowing potential in terms of GDS and TDS. It involves a simple application process that includes the pertinent information. It is important to note that this is not the same as a pre-approval, as credit has not been reviewed and income has not been verified and funds for closing are not verified.

Pre-approval

Pre-approvalRefers to the verification of the applicant's ability to borrow. A pre-approval gives a potential home-buyer the advantage of knowing how large a mortgage they will qualify for and provides a purchaser with the knowledge of what they can afford when looking for a home. This information is vital when negotiating the final purchase price of a home. Parts of the pre-approval process include an analysis of the borrower's credit history, a review of the client's employment history, and a verification of down payment funds.

Full Loan Approval

Full loan approval occurs when the lender has underwritten the application, and is satisfied tall conditions have been met. Furthermore, full loan approval refers to the approval of a mortgage for a specific property. Once full approval has been received, arrangements will be made by the lender to have the funds appropriately forwarded.