Mortgage Pre-Approval
Buying a new home is not easy. It’s one of the most emotional and biggest financial decisions you will ever have to make. This entire process is rated as one of the most exciting yet stressful times in one’s life. There’s plenty to consider: location, affordability, mortgage term and rates. There are also quite a few people to deal with: agents, lawyers, lender, seller, etc. Fortunately, there are tools to help you make buying a home an easier and enjoyable process.
THE PRE-APPROVED MORTGAGE CERTIFICATE
This certificate secures a mortgage amount at a guaranteed rate (for fixed rate mortgages) for a specific length of time. You can obtain this certificate from your mortgage representative. If interest rates increase, your rate will not. And, if interest rates fall, you get the lower rate. You're under no obligation to purchase a home within the time period. If your Pre-Approved Mortgage Certificate expires before you've found a home, you can apply for a new one by calling your mortgage representative.
Why is it important in buying a home?
A Pre-Approved Mortgage certificate allows you to shop confidently
and provides you with the security of negotiating a house price that falls comfortably within your budget. Many real estate agents will encourage you to get a Pre-Approved Mortgage Certificate before they begin working with you. The fact that you already have your mortgage financing arrangements in place indicates to prospective vendors that you are a serious buyer. The certificate outlines the maximum amount that can be borrowed, the interest rate to be charged, and the monthly payments. Of course, the confirmation is subject to a few conditions such as an appraisal of the property being mortgaged and satisfactory credit review.
What do I need to get one?
Please have these items on hand in order to obtain a Pre-Approved Mortgage Certificate:
Personal information, including identification such as your driver's license
• Details of your job, including confirmation of salary in the form of a letter from your employer
• Sources of income
• Information and details on all bank accounts, loans and other debts
• Proof of financial assets
• Source and amount of down payment and deposit
• Proof of source of funds for the closing costs (these are usually 1.5% of the purchase price)
• Details of your job, including confirmation of salary in the form of a letter from your employer
• Sources of income
• Information and details on all bank accounts, loans and other debts
• Proof of financial assets
• Source and amount of down payment and deposit
• Proof of source of funds for the closing costs (these are usually 1.5% of the purchase price)
Before you start bargaining on that perfect property, make sure you have a Pre-Approved Mortgage Certificate to alleviate some of your stresses. It’s absolutely free with no cost and no obligation with most banks or mortgage brokers. Know what you can afford, then proceed.
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