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Mortgage-Matters

It's best to get pre-approved for a mortgage when home hunting

Mortgage rate holds

With many of the experts predicting mortgage rate increases in the coming months, many homebuyers are rushing to try and buy now before that happens. This is no doubt putting more pressure on housing demand.

A mortgage rate hold will potentially provide some security should rates increase but that’s all it is— a rate hold for up to 120 days. No documents are reviewed by the lender and only the basic criteria is reviewed. There is no confirmation that in the end you will even qualify for that rate or even mortgage financing.

What you really need is a full mortgage pre-approval with a rate hold that is entirely different than the rate hold you may have received from your financial institution.

Is a mortgage pre-approval important? The short answer is yes. It is definitely important so you have the confidence to move forward with your house hunting. A pre-approval is for you and not the lender.

We are going to review your income documents and confirm the source of your down payment funds. You will know if there are any areas of concern and we will discuss a plan to move forward.

A mortgage pre-approval can give you the confidence to know that you fit within the guidelines of a mortgage lender and also a mortgage insurer if you require an insured mortgage for your purchase. It will also establish a realistic budget for your new purchase.

Here are the benefits of getting pre-approved.

• You will know your price range before you start house hunting.

• Your realtor will know exactly what type of property you should be looking at so that can save you both time and also narrow down your home search.

• Being pre-approved can give you an edge over other buyers as you may be able to close quicker and that might be important to the seller.

• There aren’t going to be any surprises as you will already know how much you require for a down payment, closing costs and how much your monthly mortgage payments are going to be.

• A pre-approval also gives you the benefit of securing your interest rate for up to four months. This is a great benefit, especially because interest rates are predicted to increase.

Here’s another tip—you don’t have to wait for an appointment to obtain a mortgage pre-approval. The first request I often receive is for a meeting and I am always happy to accommodate my clients but an in-person meeting is not required for a mortgage pre-approval.

Most are happy to find out that we can complete the process via a secure online portal, telephone and email, including collecting the required documents. This is generally more convenient for my clients and a great time-saver which can result in the pre-approval being completed in one day most times. It’s a simpler process than most think. I can complete your pre-approval most likely before you even get to an appointment with your bank.

Once you have a pre-approval and rate hold in hand, you can start your home hunting with confidence.

If you are thinking about a new home purchase this spring, please reach out so I can secure you a rate hold with your full mortgage pre-approval.

This article is written by or on behalf of an outsourced columnist and does not necessarily reflect the views of Castanet.



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About the Author

April Dunn is the owner and a Mortgage Broker with The Red Door Mortgage Group – Mortgage Architects. She has been assisting clients to purchase, refinance or renew their mortgages for over 20 years.

April has experience as a Credit Union manager, a Residential Mortgage Manager with a large financial institution and as a licensed Mortgage Broker. By specializing in Strategic Mortgage Planning she has the tools available to build a customized mortgage plan, with the features and options that meet your needs.

April provides a full range of residential and commercial mortgage financing options for clients all over the province of British Columbia and across Canada through the Mortgage Architects network.

Contact e-mail address: [email protected] or by phone at: 888-561-2679.

Website:  www.reddoormortgage.com



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The views expressed are strictly those of the author and not necessarily those of Castanet. Castanet does not warrant the contents.

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