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In a nutshell, it has to do with the amount of validation that's taking place. The primary difference is in the level of validation and the amount of information that that's provided by the person who's trying to get the loan. The reason you want that validation is that you want some level of certainty. Certainty that if you found that house, you could get that house, and certainty that you're looking at the right level of homes. Even if you've done your own calculations, a pre-qualification can give you a more precise figure on how much you can borrow, so you can make a more detailed budget and plan.