You are ready to buy a home, and now the next very important step is being per approved! This term is often used interchangeably with pre qualified, though they area two very separate terms. Becoming pre qualified is the step before being pre approved. Pre qualification is an estimate of how much you can afford in a mortgage payment based upon the information you provide the lender. Pre approval is a firmer commitment on behalf of the mortgage company after they have run a credit check, checked employment verification and researched your payment history on other loans. With a letter of pre approval from your lender, you will advance on to looking at properties and then entering in to the negotiating phase of purchasing. The letter becomes the item which assures the seller that your offer is viable. This is very important in a competitive market especially when the seller may be considering multiple offers.