Before beginning the process of looking for your dream home, it is a good idea to get pre-approved for a mortgage. One of the first things buyers should do is talk to a qualified mortgage broker (or mortgage agent) and get pre-approved for a mortgage. Too many owners neglect to seek pre-approval, despite the fact they are under no obligation and it gives them more negotiating power with a seller when placing an offer on a home. Being pre-approved is an important financial plan and allows you to discuss with your mortgage broker the mortgage amount, down payment required and find out how much house you can afford. You can also talk about the many available mortgage products and get information on fixed vs. variable mortgage rates, interest terms, payment options, amortization, etc.) Your mortgage broker assists you with your application and you will be required to provide details on such items as employment, income, assets, down payment and liabilities.
There are many benefits to being pre-approved. Pre-approvals will lock in best fixed mortgage rates against increases for 90, 120 to 180 days (amount of time is depending on the rate and lender). You will have a better idea how much you can borrow, how much home you can afford and what your monthly mortgage payments will be. When you put in an offer on a home, you’ll be able to act more quickly and Real estate agents will know you’re serious and work harder on your behalf to find you a home.
Remember, being pre-approved does not guarantee 100% you will get a mortgage loan. Your mortgage broker (or mortgage agent) will discuss conditions that must be met for your mortgage to be fully approved. There are a few reasons you may not be fully approved for your mortgage such as; income or employment has changed, lender does not think the purchase is worth the loan amount, you take on substantial debt or make large purchases after the pre-approval. Your mortgage broker (or mortgage agent) should discuss these with you and any other conditions that can hurt your chances.
Don’t get pre-qualified confused with pre-approval. A mortgage broker will “pre-qualify” you to confirm that you meet general guidelines, but only a lender’s underwriter can “pre-approve” you after a detailed analysis of your creditworthiness.
At the Oakville Mortgage Team, our best mortgage brokers can assist you with pre-approval, finding the best mortgage products for your needs and get you best mortgage rates. Contact us today to find out more on how you can successfully obtain a mortgage loan.