What is a mortgage pre-approval?
A fully underwritten pre-approval is the process of determining whether a borrower meets lenders' and insurers' guidelines for a mortgage. It identifies your lowest cost lender and best mortgage options. It shouldn't be confused with a mortgage pre-qualification, which is a more cursory look at your financial picture. A mortgage pre-approval, done correctly, gives you confidence that you are a qualified borrower. It determines the maximum purchase price you qualify for or how much you feel comfortable spending on your new home purchase. To avoid surprises and elevated costs, it is best to get your mortgage pre-approved first, before you begin shopping for a home.
The pre-approval process can start up to 120 days before you want to make an offer on a home. It is beneficial to get the pre-approval work done up front, if possible, before dealing with offer negotiations and tight finance deadlines. There are a number of reasons why you would want to get pre-approved:
Pitfalls of a Pre-qualification:
A pre-qualification is just a discussion, often a series of questions relating to income and down payment, either face-to-face, over the phone, online, or with a mobile app. These questions are best used only to begin initial inquiries about your mortgage qualification. The "results" are just rough estimates. If you haven't provided supplemental documentation and consent for your credit to be checked, chances are you don't have a fully underwritten mortgage pre-approval in place. It is important to note that not all mortgage lenders offer pre-approvals. You will want to confirm with your mortgage professional that he/she can provide this service.
Final mortgage approval:
For a free, no obligation consultation to discuss your mortgage pre-approval options, please contact one of our experienced Winnipeg Mortgage Brokers by phone at 204-954-7620 or by email at email@example.com.