Definition
A mortgage pre-approval is an initial assessment by a lender (or several lenders via a broker) of the maximum amount they are willing to grant you and the conditional rate offered. It is based on your income, TDSR/GDSR ratios, credit score, and announced down payment — not yet on a specific property.
Validity period: 90 to 120 days, sometimes 130 at certain lenders. During this period, the rate is guaranteed downward (you automatically benefit from a market drop) but protected against increases. It is a strong asset when negotiating an offer: a seller prefers an offer with valid pre-approval.
Watch out: pre-approval ≠ approval. Final approval depends on the property appraisal, final income verification, and credit file review the day before funding. A material change (job loss, new car loan, overvalued property) can lead to refusal despite pre-approval. Not to be confused with "prequalification", an automated calculation without commitment.