Getting a good pre approval is a very important step in buying a home. Some banks issue pre approvals that are loosely based and more about a rate guarantee. However a good pre approval from a Toronto or Brampton mortgage broker is based on income, so it means you make enough money to qualify for the mortgage amount. This way when you do put an offer forth, your mortgage application should be accepted.
A good pre approval will also indicate how much down payment and closing fees you’ll need. Sometimes people don’t realize all the extra costs like lawyers fees, real estate costs and property tax and end up not being able to afford all the fees.
Rate guarantees are also part of a good pre approval, usually for 90-120 days. However be sure to ask if you can take advantage of a decrease in interest rate and if rates are trending up, whether the lowest rate can be guaranteed. Every mortgage broker in Brampton and Toronto runs a different deal so be sure you are clear.
Budgeting for your new home with be a bit of a challenge but a good pre approval will give you a very accurate idea of what your payments will be. This way you can make a good decision on purchase price. You can even do a couple of months of practice carrying your mortgage payments, by putting the additional cost over your rent into savings.
Typically a home purchase is the biggest purchase of a person’s life, a good pre approval will make sure you’re ready. Contact me for more information on how to get pre approved for a mortgage.
