Mortgage pre-approval first

All the recent mortgage rule changes have made it more difficult to qualify for mortgage financing.

I am receiving calls almost daily, not only from first-time homebuyers but also move-up buyers who are surprised to find out that they may not qualify for the new financing required to make their desired purchase.

The term pre-approval is somewhat misleading as even with a mortgage pre-approval we cannot guarantee that you are 100 per cent approved for your financing. There are many variables that will factor into your final mortgage approval including the lender reviewing the property you are purchasing.

A mortgage pre-approval can give you the confidence to know that you fit within the guidelines of a mortgage lender and also a mortgage insurer, if you require an insured mortgage for your purchase. It will also establish a realistic budget for your new purchase.

Here are the benefits of getting pre-approved.

  • You will know your price range before you start house hunting.
  • Your realtor will know exactly what type of property you should be looking at; that can save you both time and also narrow your home search.
  • Being pre-approved can give you an edge over other buyers as you may be able to close quicker and that might be important to the seller.
  • There aren’t going to be any surprises as you will already know how much you require for a down payment, closing costs and how much your monthly mortgage payments are going to be.
  • Since you are already pre-approved this may put you in a better position to negotiate with the seller.
  • A pre-approval also gives you the benefit of securing your interest rate for up to four months. This is a great benefit especially as interest rates are predicted to increase in the first quarter of this year.

Here’s another tip – you don’t have to wait for an appointment to obtain a mortgage pre-approval. The first request I often receive is for an appointment to meet, and I am always happy to accommodate my clients, but an in-person meeting is not required for a mortgage pre-approval.

Most are happy to find out that we can complete the process via telephone and email. This is generally more convenient for my clients and a great time-saver that can result in the pre-approval being completed in one day most times. It’s a simpler process than most think.

Once you have a pre-approval in hand you can then start your home hunting with confidence.

I must repeat that the new mortgage qualification rules are making it more difficult for all to obtain financing, so it’s better to go through the simple process of a mortgage pre-approval before moving forward with a home purchase.

Before you fall in love with a home you should know if it’s within the reach of your finances. The first person you should call before reaching out to a realtor is a mortgage professional.

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About the Author

April Dunn is the owner and a Mortgage Broker with The Red Door Mortgage Group – Mortgage Architects. She has been assisting clients to purchase, refinance or renew their mortgages for over 20 years.

April has experience as a Credit Union manager, a Residential Mortgage Manager with a large financial institution and as a licensed Mortgage Broker. By specializing in Strategic Mortgage Planning she has the tools available to build a customized mortgage plan, with the features and options that meet your needs.

April provides a full range of residential and commercial mortgage financing options for clients all over the province of British Columbia and across Canada through the Mortgage Architects network.

Contact e-mail address: [email protected] or by phone at: 888-561-2679.

Website:  www.reddoormortgage.com

The views expressed are strictly those of the author and not necessarily those of Castanet. Castanet does not warrant the contents.

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