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Get pre-approved!

These days most REALTORS® advise their clients to pre-qualify for a mortgage before starting to house hunt seriously. Pre-approval of a mortgage happens once your lender has reviewed all your financial information and has determined the maximum amount of money you can borrow. You have to assemble the data, but your lender does the math.

The advantages of pre-approval include:

Knowing how much you can borrow, so you don’t waste time looking at properties you can’t afford.
Not having to worry about rising interest rates while shopping for a home, since your lender will usually guarantee the current interest rate for sixty to ninety days.
Having an edge when you make an offer, since the seller knows you are more likely to get a loan.
Saving time when you apply for your loan because you’ve already assembled your paperwork.
Not only does this make the transaction smoother in the final analysis, it also saves you the guesswork by telling you exactly what you can afford.

Where to get pre-approved

Remember that, provided you seem to be a good credit risk, financial institutions want to lend you money. Lending you money is how they make their money, after all, and lending you more money, like a mortgage, means that they are going to make money off you for a very long time. It is, therefore, to your advantage to shop around for a mortgage – because they are in competition to get your business.

Once you’ve selected your lender, you will need to provide your financial information. You lender will want the following:

Personal information such as the number of dependents and marital status;
Details of employment, including a letter from your employer verifying your salary;
Banking and investment information;
Details of your assets (i.e., car, other property);
Information on loans and other liabilities; and
Permission to do a credit check.

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This information is provided by the London and St. Thomas Association of REALTORS®.
The information herein is believed to be accurate and timely, but no warranty as such is expressed or implied.