Pre-Approval Is Entering The Real Estate Market With Confidence

A mortgage approval should take only a few days, but it is probably best to allow more time. During this process, the lender will do a credit check and spot check other information you have provided. In addition, an appraisal of the value of your home may be obtained. Whether the lender approves your loan application will be determined by an evaluation of the following:

Capacity:

Do you have enough income to repay the debt?

Credit history:

Do you pay your bills on time and do you live within your means?

Capital:

What are your current assets?

Collateral:

What assets can you pledge as security against the mortgage?

A pre-approved mortgage is very common. With pre-approval, your lender approves the amount of your mortgage, subject to a property appraisal and other stated conditions, and gives you a written confirmation or certificate for a fixed time period before you start looking for a home. The pre-approval term, usually lasting from 60 to 120 days, also sets the mortgage rate the lender will offer you. If rates go down in the specified period, the lender should offer you the new lower rate.

With a pre-approval letter, you will be able to look for a home with the security of knowing exactly how much you can borrow.

You get an advantage over other buyers who are not pre-approved. Showing sellers that you've already secured financing can make your offer more attractive.

You will find out about possible qualification problems ahead of time. Don't wait until you've found a home to find out if credit issues or other factors may affect your ability to get a home loan.

Pre-approval makes the final mortgage process go more quickly and easily, since much of the work has already been done.

What information is required to be pre-approved for a mortgage? If you are applying for a preapproved mortgage, have following information ready:

Have your employer give you a letter on company letterhead outlining your name, position, gross annual income, and number of years employed with the company.

If you are self-employed, you will need three years financial statements, and tax returns (together with official assessment from Revenue Canada).

Social Insurance Numbers.

At least 3 years history of residences and employers.

Know your banking information (i.e. institutions name, address, type of accounts, account numbers)

Know your assets and their value (i.e. cash amounts, stocks, bonds, RRSPs, car).

Know your liabilities (i.e. car loan, credit card balances).

Also, be sure and advise me about any past credit problems you may have had.

Finally, write down a list of questions you would like me to have answered.

Buyingblock Mortgages Inc.

571 King Street West, Toronto, Ont. M5V 1M1 - Lic. # 10645

alltorontomortgages

Michael Pezzack

Mortgage Consultant

Lic. # 08003302

tel: 416-850-2642

fax: 416-850-2643

cell: 416-358-1295

toll free: 1-866-644-4613

Scott Henson

Mortgage Consultant

tel: 647-238-8232

fax: 416-850-2643

toll free: 1-866-644-4613