Definition
Pre-approval is a preliminary determination by a lender, based on an association’s finances, of how much it can likely borrow and on what general terms.
Why It Matters Financially
Pre-approval lets a board plan a project and present credible numbers to owners before committing. It clarifies budget and timeline early, reducing surprises later in the process.
Example Use Case
A board obtains pre-approval before presenting a financed roof project to owners, so it can show real monthly costs.
Thinking about financing a reserve project?
Talk to an HOA financing expert. Get pre-approved
Related Terms
Underwriting, Loan Application, Creditworthiness, Association Loan, Debt Service Coverage Ratio