When Should You Start Your Pre-Approval?

Great Information from Michelle Lapierre at Mortgage Tailor Solutions -

The Earlier The Better!


If buying a home is a consideration in the next year, it is time to sit down and talk financing.  I often sit down with buyers 6-12 months ahead of their planned purchase. If you are selling and buying, it is even more complex and you definitely want to understand your financing options prior to listing your current property.  By doing a pre-approval early you get the following benefits:

Find Out If You Qualify

With mortgage rule changes over the past few years, it has become more and more difficult to qualify for a mortgage. It is very important to get a sense of where you stand early in the process and make sure you are prepared.  If you do qualify, for what property type and amount?  If you do not qualify, what can you do to get yourself to where you want to be?  Often there are things that can be done to better position yourself for a purchase.  For example, you may need to get access to your equity for down payment or perhaps paying off a credit card or reducing a mortgage payment on another property you own could allow you to qualify.


Learn Mortgage Options Before A Time Crunch

Once you write an offer on a home, you are under a condition deadline to get your financing complete. This can be an intense time and so difficult to make thought-out decisions. Understanding various types of mortgages (ex. fixed vs. variable) and different mortgage features before writing an offer can allow you the time to think through what is the best fit for you.  You can avoid a quick decision under time pressures that you may regret later.  


Fix Credit Issues

By starting early, you have time to repair credit or even fix errors on your credit report.  These can take time to clear up or improve, so it is far better to deal with them before you write an offer and are in a time crunch.


Dont Miss Unexpected Opportunities

If the perfect property or an excellent deal comes up earlier than you expected to purchase, you want to be able to take advantage of the opportunity. 


Gather Documents Ahead

Tighter mortgage financing has meant more documents are required by lenders to confirm your mortgage approval.  By gathering that paperwork during the pre-approval stage, it makes financing faster when you actually write an offer and have a deadline to meet.


Know How Much Money You Need

Meeting early can give you the time you need to save for not only the required down payment, but also for the additional costs associated with buying a home. 


A home is likely the largest purchase you will ever make. By starting your financing early and educating yourself, you will feel more in control of the process and make better, informed decisions along the way.


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Today’s Bank of Canada rate hold announcement marks almost four straight years that the key benchmark rate has remained unchanged, since September 8, 2010. Great news if you have a variable-rate mortgage or home equity line of credit; the prime rate stays at 3%.


The announcement noted that “the risks to the outlook for inflation remain roughly balanced, while the risks associated with household imbalances have not diminished.” With these considerations, the Bank is maintaining its monetary policy stimulus, and remains neutral with respect to the timing and direction of the next change.


The next rate-setting day is October 22nd.

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