There are many benefits to getting pre-approved for a mortgage! In this article, we will explain the four main steps involved in getting pre-approved for a Toronto mortgage.
Step 1: Learn What Pre-approved Means
When you are pre-approved for a mortgage, you get all the following benefits:
- You will know the maximum mortgage you are eligible for.
- You can estimate how much your mortgage payments will be.
- You will be “locked in” to a mortgage rate for up to 130 days. You will be eligible for a lower rate if the rates go down, but protected if they go up!
Step 2: Find a Lender You Want to Work With
There are numerous different kinds of lenders that you can work with if you are interested in getting pre-approved for a mortgage for a Toronto home.
You are likely already familiar with some of these lenders, such as your current bank or credit union. However, there are also other lenders that you can work with to get pre-approved, such as mortgage companies, insurance companies, and trust companies.
Do not settle for just one lender. Shop around, or even better, work with a mortgage broker who will shop around for you. A mortgage broker can quickly provide you with access to information about many different lenders and the mortgage products they offer.
Step 3: Get Prepared for the Meeting With Your Lender or Broker
You will need to provide whomever you are asking for a pre-approved mortgage with some basic information, such as your income, debts, and assets.
In addition, you will also need to provide the lender with the following:
- Identification, such as a passport or driver’s license.
- Proof of employment. This can take various forms, such as a letter from your employer stating your salary or a pay stub. If you are self-employed, it can be a notice of assessment from the CRA.
- Proof that you can afford a down payment and the closing costs of buying a home.
You must not leave anything out when listing the details about your various debts. Additionally, do not forget about debts such as student loans or credit card balances.
Step 4: Make a List of Questions to Ask Your Lender
It is essential to be prepared when you meet with your lender. These are some of the questions you can ask them about being pre-approved for a Toronto mortgage:
- How long will the rate be locked in?
- Will the locked-in rate automatically be lowered if interest rates go down?
- Can we extend the pre-approval if we don’t find a house within the standard period for locking in a rate?
We Can Help If You’re Looking for a Pre-approved Toronto Mortgage
If you would like to learn more about getting pre-approved for a mortgage, you can call us at 888-257-8130 or contact us online.