Be $10,000 Wealthier Within 120-Days by Getting You Mortgage Pre-Approval Now
Most people who spend hundreds of hours house-shopping online don’t realize that spending a mere 28 minutes getting a mortgage pre-approval can make them $10,000 wealthier while getting protection from losing thousands of dollars.
A mortgage pre-approval is simply a calculated estimate of what the maximum mortgage amount you are eligible for with a conventional lender. It takes no longer than an optional 15-minute phone call with me and a 28-minute application process from the comfort of your own home. No, you do not need to do this at a physical bank and this can be done faster than it would take you to wait for your likely back-logged appointment to actually start.
Getting pre-approved is strongly advised before you house shop because if you do not, you run the risk of wasting you and your realtors time by shopping for homes beyond what you can afford. Additionally, when it comes time to make an offer on a home that likely has multiple bids, the fact that you are pre-approved signals to the seller that you can finance the purchase. Even worse, you run the risk of losing thousands on your deposit after you put in a live offer and realize that you can’t get enough mortgage financing!
Example of how you can save $10,000:
Besides not losing thousands of dollars, mortgage pre-approvals benefit you from letting you save up to $10,000 in some cases by holding a rate up to 120-days. Even if you are waiting to buy a home “in the near future” you can hold a low rate today and even if when you buy a place the rates are lower, you get the lowest of the two rates. Consider a low 2.10% rate during COVID-19 which could soar past 3% once the pandemics ripple effects kick into the economy but, you’re suddenly allowed to see properties freely again and you find a place you love! You now get your mortgage approval and you have to pay 3.10% on let’s say a $330,000 mortgage.
Here is the quick math on the money you would have saved:
On a 5-year term at 2.10%: $1,413.36/month and $84,801.60 total
On a 5-year term at 3.10%: $1,578.69/month and $94,721.40 total
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Save $9,919.80 for 28-minutes of your time!
How It Works: The 28-minute Process
Personal Details Application Form - Send this first, please! (~15 minute completion time)
Option A) Apply on a secure online portal named Finmo.com (make a quick account here). This makes the process much faster with less back and forth in terms of getting your personal, employment, property, and assets.
Option B) You may also fill out an attached PDF form and send back.
Income Confirmation: (~12 minute completion time)
If you are an employee:
A recent paystub to determine the annual income --> Email your employer or scan a physical receipt
Letter of Employment --> Email your employer about this - must follow correct format
The last Two Years of T4 Statements --> Available online with the CRA or via you accountant
The last Two Years of Notice of Assessments --> Available online with the CRA or via you accountant (see how to access online)
One piece of government-issued identification --> I hope you would have this readily available!
Down Payment (DP) Confirmation: 90 Days of Bank Statement Transactions showing the source of DP - See example screenshot here.
If you are self-employed:
The last Two Years of T1 General Statements
The last Two Years of Notice of Assessments --> Available online with the CRA or via you accountant (see how to access online)
Articles of Incorporation (if applicable)
One piece of government-issued identification
Proof of down payment and ability to pay closing costs (recent financial statements of bank accounts and investments)
Down Payment (DP) Confirmation: 90 Days of Bank Statement Transactions showing the source of DP - See example screenshot here.
If you are retired:
2017 & 2018 T4a Statements
Letter of entitlement for pension & old age security (if applicable)
One piece of government-issued identification
Down Payment (DP) Confirmation: 90 Days of Bank Statement Transactions showing the source of DP - See example screenshot here.
Keep in mind that being pre-approved is never a guarantee to financing as your financial or employment situation might change when it comes down to funding the mortgage and also, lenders need to ensure that your property is safe collateral for them to hold onto. For example, if the home is in bad condition, has strange wiring, is a heritage home, is in a remote area, or its appraised value is below the purchase price, the lender may deny you.
Getting pre-approved for a mortgage is simply the smart and profitable thing to do before you go house-hunting. Investing 28 minutes to get a mortgage pre-approval can make you $10,000 wealthier and protect you from losing thousands of dollars.
Get pre-approved by contacting Paul here