What’s The Difference Between Preapproved And Prequalified For Student Loans?

‘Preapproved’ and ‘prequalified’ are sometimes used interchangeably when discussing student loans. That’s not right however. The only similarity between the two is that they are both parts of the student loan process. Other than that, both of these terms are completely different.

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What Is Prequalification?

Prequalification is basically an estimate of how much you may be able to borrow.  based on a mostly informal evaluation of your finances.

This is the first step in the loan approval process. It involves giving the lender your overall financial picture, including information about your income, assets, credit and debt. The lender reviews all details and gives you an estimate of how much you may be able to borrow.

The whole prequalification process can be done over the phone or via email. The exact process varies from one lender to another. You don’t have to pay any fees to get this estimate.

What’s important to remember is that this is just an estimate. It is not the final amount that you can borrow. You’ll only get a definite answer on how much you can borrow after the preapproval step. So why bother with going through the prequalification process if it doesn’t guarantee a loan offer? Prequalification does help in other ways. It gives you an idea of how much you may be able to borrow and at what rate. This allows you better assess the cost of the loan and plan your finances accordingly. If you don’t get prequalified because of poor credit, you can start taking steps to rectify that.

What Is Preapproval?

Preapproval is the second step in the loan approval process. It’s a more in-depth assessment of your finances.

To get preapproved, the lender will want to see documents related to your assets, income, employment, and debts. Based on the lender’s assessment, they will then preapprove you for a specific loan amount.

During this step of the process, the lender will also do a hard check your credit report. This hard credit check is a major factor in the preapproval process. Pulling up some previously unseen information on your credit report could affect whether or not you get preapproved. It will also impact the amount you get preapproved for.

Because this thorough investigation into your finances can be time-consuming, most lenders charge a processing fee.

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A loan designed with you in mind

Variable cosigned rates from 6.17% - 16.11% APR with auto-debit


Highlights of Prequalification vs. Preapproval

Let’s highlight the main aspects of prequalification and preapproval.


  • Is an estimate of how much you may be able to borrow
  • Based on the information you submit to the lender
  • Process may be done over the phone or online
  • There’s no cost involved
  • Does not carry as much weight as preapproval


  • Gives you a better idea of the size of loan you’d qualify for
  • Based on extensive credit and financial background check
  • Requires submission of financial documents
  • Involves a hard credit pull
  • May involve processing fees
  • Carries more weight than prequalification



Lender Rates (APR) Eligibility
Citizens logo.
6.38%-14.28%* Variable
4.48%-13.29%* Fixed
Undergraduate and Graduate
Sallie Mae logo.
6.37% - 16.70% Variable
4.50% - 15.49% Fixed
Undergraduate and Graduate
Credibe company logo.
4.98% - 17.99% Variable
4.13% - 17.99% Fixed
Undergraduate and Graduate
Lendkey company logo.
5.84% - 11.11% Variable
4.39% - 11.11% Fixed
Undergraduate and Graduate
Ascent company logo.
6.17% - 16.11% Variable
4.13% - 15.46% Fixed
Undergraduate and Graduate
6.54% - 11.08% Variable
3.95% - 8.01% Fixed
Undergraduate and Graduate
Earnest company logo.
5.62% - 16.20% Variable
4.42% - 15.90% Fixed
Undergraduate and Graduate
4.98% - 12.79% Variable
8.42% - 13.01% Fixed
Undergraduate and Graduate
College Raptor is not a loan lender and does not assume responsibility for suggesting a loan to a user who may not be eligible for it. Rates, terms, conditions, eligibility, approval, and other considerations are the decisions of the lenders and may vary depending on which lender or marketplace the user selects. We urge users to carefully consider and review all loan options and terms before committing to taking out a loan.