Get a Mortgage Pre-Approval
An important ingredient in a successful home search is knowing how much you can afford. You don’t want to fall in love with a property only to find out it’s outside your price range.
That’s why we recommend getting a Mortgage Pre-Approval. This is a document from your bank or other lender stating how much of a mortgage they are willing to give you. There are two advantages to getting this pre-approval:
- It gives you the peace-of-mind of knowing you can afford homes you view on the market, and won’t have problems arranging financing.
- It’s a sign to sellers that you are a serious, prepared buyer – which gives you the edge when making an offer.
Once you’ve qualified for a mortgage, there are some basic decisions you will have to make before you take possession of your home: mortgage term, amortization, interest rate and type of mortgage. The more you understand about your options, the better prepared you will be when that big day arrives.
There are lots of lenders and mortgage agents out there. These are the mortgage agents we trust and always recommended to our clients, but you should ask family and friends for their recommendations as well.
- A mortgage broker. Mortgage brokers work with a lot of different lenders and will go to them on your behalf to find the best mortgage rate and terms. Usually, broker fees are paid by the banks, so it’s a good way to comparative shop without having to do all the leg work yourself. Our ideal go to agent is Alexandra Monaco from Turnbull Financial – The Mortgage Centre. We’ve yet to find someone who delivers better service! connect with Alex
- A bank. RBC doesn’t work with mortgage brokers, and we’ve found them to be extremely competitive with rates and mortgage terms. Our main contact at RBC is Adriana Romeo. Looking for expert advice, Adriana is well versed in all things mortgage! connect with Adriana
How Much Home Can You Afford?
Banks and lenders use specific criteria to determine how much of a mortgage they’re willing to offer you. They look at your income, expenses, credit history and employment status, as well as the down payment you plan to make on a home. It may seem like a scary process but it is actually straightforward. You can usually get a Mortgage Pre-Approval in a day and you’ll be glad that you did.
By knowing what you can afford, you can confidently shop within that price range. For example, if you qualify for a $350,000 mortgage, and you have another $100,000 available as a down payment, you can look for homes in the $450,000 range.