Understanding Your Mortgage
Find out about your mortgage options before you start looking.
There's nothing more frustrating than falling in love with a home, only to find out you can't afford it. Pre-qualifying for a mortgage is the best way to find out how much you can afford. Your financial institution will look at your income, expenses and debt to determine how much they will lend you. Combine that amount with the money you have for a down payment, and that’s your budget.
Pre-approval of a mortgage is when your lender has reviewed all your financial information and has determined the maximum amount of money you can borrow. The advantages to pre-approval include:
- You know how much you can borrow, so you don’t waste time looking at properties you can’t afford.
- You don’t have to worry about rising interest rates while shopping for a home, as usually the mortgage broker will guarantee the current interest rate for 60 - 90 days.
- You have an edge when you make an offer, because the seller knows you’re more likely to get a loan.
- You save time when you apply for your loan because you’ve already assembled your paperwork.
Consider using a Mortgage Broker.
Working with a qualified, independant Mortgage Broker like Custom Mortgages can help you secure the best available rate for your loan. Since Mortgage Broker's aren't affiliated with any specific lender, they can work in your best interest with various competing lenders to get you the best rate.
Mortgages are available through a number of financial institutions; your bank is only one option. Shop around for competitive rates and options. Custom Mortgages offers a wide range of mortgage products and home financing solutions. Whether you're buying your first home, considering a renovation, or looking into your next purchase, Custom Mortgages has the options, choice and flexibility to meet your specific needs.
Once you have selected your lender, you will need to provide your financial information. Your lender will want the following:
- Personal information such as number of dependents and marital status;
- Details of employment, including a letter from your employer verifying your salary;
- Banking and investment information;
- Details of your assets (i.e. vehicle, other property);
- Information on loans and other liabilities; and
- Permission to do a credit check.
- Once your application is complete, you will know how much you can borrow and you will be ready to start searching for a home.
Want to get a better idea of how much you can afford? Try one of these Mortgage Affordability Calculators for a quick estimate.