Pre Approval Versus Rate Hold

There is a substantial difference between a rate hold and Pre Approval. If you have not provided any documentation and received confirmation that an interest rate is locked in or held for a certain period of time, then you most likely have a rate hold. This is good in that the interest rate is guaranteed. It is not good in so much as that the lender has not considered your application and could refuse to lend on the grounds that necessary criteria were not met.

With a Pre Approval, documentation should be gathered and presented to the lender to ensure that everything meets their criteria. Although not always possible, a pre approval with outstanding conditions in writing is preferred.