As a homeowner, I know first-hand that buying a new home can be an exciting and lively process. Don’t let this milestone event become daunting. Getting pre-approved for a mortgage makes buying a house a smoother and faster process allowing you to focus on what is most important—finding a home that fits you.
Getting a mortgage pre-approval will determine the amount you can afford to borrow to finance your new home. Upon getting pre-approved, you will also be able to find out how much your monthly mortgage payment will be if you purchased a home at the highest end of your price range. It also will indicate your future mortgage rate for the first term of your mortgage.
Benefits of Getting Pre-Approved
When it comes time to start looking at houses, you will already know what homes you can afford to buy saving you and your realtor valuable time visiting homes beyond your price limit.
After getting pre-approved, the mortgage rate offered by the lender is secured , generally for a period of 60-120 days. Therefore if the interest rates increase while you are still looking for a home, your lender will still honour the rate they approved you for. If their interest rate decreases while searching, the lender will honour the lower rate mortgage.
In the event you make an offer on a home, having been pre-approved, the seller will see that you are able to finance the home with no issues thus favouring you over other interested buyers.
Your realtor, seeing that you have been pre-approved for a mortgage, will know that you are a serious buyer and will concentrate their efforts on you over others clients.
How to Get Pre-Approved
Get in touch with Fort McMurray mortgage planner Barb Pinsent to begin the easy process. There will be a set of questions required to answer to determine how much money a lender will loan you and some necessary documents will need to be provided. There are four main factors that will determine your pre-approval.
- The first is a good credit score. This will make lenders confident you can afford to return their money.
- Second is having a down payment. On houses below $500,000.00, a down payment of at least 5% of the cost of the home is required in Canada.
- Thirdly is all supporting documentation such as ID, proof of income (paystub), proof of employment, proof of assets (ie. a vehicle), and proof of down payment.
- You may also need to provide documentation on any outstanding debts you currently hold such as a line of credit, student loan, car lease, or child support.
For more information or any questions you may have about mortgage pre-approval, give me a call at 780-370-1490 or contact me to discuss further or fill out the form below to get in touch with me about your mortgage solutions: