SANTO DOMINGO – Mortgage loans represent the primary means of purchasing a home. During 2025, this segment experienced the greatest growth within the Dominican banking system, according to the Superintendency of Banks. The loan portfolio reached 443.17 billion pesos, registering a year-on-year increase of 13.2%.
In the process of obtaining this type of loan, two terms are involved: prequalification and preapproval, which have distinct meanings and purposes. Prequalification is a preliminary step in determining the mortgage amount you could obtain, while preapproval signifies conditional approval for the loan amount you will request.
Experts believe that pre-qualification can be granted using information entered by the applicant, but not yet verified, such as their income or assets. With this information, the mortgage amount for which the person would likely qualify can be determined without conducting a full credit check. The lender could then issue a formal pre-qualification letter or indicate the amount they are willing to lend.
Pre-approval, on the other hand, requires completing a mortgage application and undergoing a thorough credit check to determine the applicant's creditworthiness. With this information, the bank can provide a more accurate estimate of the loan amount the applicant will be approved for once they are ready to finalize the application.
If you're still in the early stages of the home buying process, pre-qualification can be helpful in getting a rough estimate of how much you'll be able to borrow. Then, when you're ready for a more detailed financial analysis, you can proceed with pre-approval.
Getting prequalified and pre-approved can help you determine what type of housing you can afford. Prequalification is usually the easier step, but it offers less certainty about the loan amount the lender will approve. Therefore, consider getting pre-approved before negotiating with the seller.
In some cases, the operation of both processes may vary depending on the credit institution.
Content originally published in issue 15 of El Inmobiliario print edition.
Source consulted:
www.investopedia.com
Recommended readings:
