Borrowers

May 22, 2021 | Mortgages | 0 comments

4 Quick tips for your mortgage pre approval

Mortgages | 0 comments

The entire house hunting process can feel daunting. In today’s blog post we’re break down the 4 big things to think about you head out to look for a new home in Calgary.

First steps for your mortgage approval.

Confirm your affordability

Make sure you provide the requested documents to your mortgage broker so their pre-approval can accurately calculate your purchasing power. This will give both you and your realtor peace of mind so that you know you’re shopping for a property within your budget.

Know your rate. Know your products.

There are so many rates, terms, conditions and fine print out there when it comes to mortgage products. A great rate is often the key focus but make sure your mortgage broker has explained all of the fine print. How much extra can I pay on my mortgage each month? Each year? What is my penalty to break the mortgage and when does it apply to me? How long am I guaranteed this rate? 90 days? 120 days? These are all questions you’ll want to make sure you’ve asked your broker. Then you know exactly what you’re dealing with when you’re shopping for that new home in Calgary.

Borrowers
decreases in borrowing power for your calgary mortgages

Communicate with your broker

A mortgage has quite a few moving parts. The last thing anyone wants is a surprise. Good communication is the key. If you are uncertain about any aspect of the transaction, ask. Don’t assume! You have a broker, lawyer and real estate agent working for you. Use these resources to stay informed and keep through the process. Further, if anything changes for you, like employment or down payment, or potentially the type of property you’re considering, check in with your mortgage broker and make sure this doesn’t change your rate, product or purchasing power.

 

Stay calm.

Lenders are required to calculate line of credit and credit card debt as if the client was obligated to pay 3% of the current balance each month. For example, if you have a credit card with a balance of $10,000, lenders need to calculate a payment of $300/month when deciding how much you can borrow, (even though your minimum payment is likely only $80/month). Working with a mortgage professional that has a firm understanding of how to restructure debt can greatly benefit your mortgage file. Rolling Credit Cards or Lines of Credit in to “Term Loans” or considering products like a cash back mortgage can help to decrease the perceived monthly obligations and add thousands of dollars to your maximum borrowing power.

 

 

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