Whether its your first time or your fifth time, buying a home is an exciting endeavour. While most Canadians are excited to get out on the market and put in an offer on their dream home, it’s important to get a sense of what you can afford and what amount of money lenders might provide to you in financing your housing purchase.
Before getting started on your home buying experience, first take the time to prep yourself with a pre-approval.
What is a Pre-Approval?
The pre-approval is the exercise of getting a clearer picture of your financial scenario. Your mortgage professional will want to know whether you have any debts, what kind of mortgage you may or may not currently have, how much income you’re making, how much of a down-payment you’ve saved and what kind of property you’re looking to purchase. That info will allow your mortgage professional to give you a pre-approval outlining how much of a purchase price you can afford on a home and the mortgage rate that will be offered to you.
Once pre-approved, your pre-approval will have a rate guarantee attached to it. Typically valid for a period of 3 to 4 months, the “rate-hold” will give you the peace of mind of having a particular rate while you look for your next home. The best part is that even if rates go up, you’ll have your mortgage rate locked into place – and even better, if rates go down you’ll have access to that new lower rate.
How do I get Pre-Approved?
While it’s tempting to call your favourite realtor and start booking appointments to see some beautiful homes, you’re better off having the pre-approval conversation with a mortgage professional first. That way, once you’ve found the right property, you’ll be ahead of the game, and will be able to submit an offer that works within your budget and can land you that property you’ve had your eye on.
If you’re in the GTA and currently don’t have a realtor, the MonsterMortgage.ca VIP program can get you in touch with the city’s finest – and to top it off, you can get 1% cash back on the amount of your mortgage too.
What will be asked of me?
Your mortgage professional will ask you the following:
– How much of a down-payment have you saved?
– What is your credit score?
– How much income are you earning each year?
– What is the nature of your income (salaried, self-employed, new hire etc.)
– Do you have any outstanding debts?
Once you’ve answered these questions, your mortgage professional will be able to provide you with a range in price for your next housing purchase.
However; please note that a pre-approval does not guarantee financing. A lender will still have to evaluate the condition of the home you’re looking to purchase, the appraised value of the home (through an appraisal report from a list of approved appraisers), a confirmation from your employer of your income and the nature of your employment among other things.
It’s also important to note one other thing… your pre-approval is free!
If you’re looking to get pre-approved so that you can start shopping for your dream home, fill out the form at the top of the page and speak to a MonsterMortgage.ca Mortgage Expert today!BACK TO BLOG FEED