A pre-approved mortgage is a confirmation by a lender of your ability to be approved for a mortgage. This confirmation is possible with the provision of documentation below.
A pre-qualified mortgage is a lender’s estimate of your ability to pay a mortgage with no verification whatsoever. It is a prediction only of your ability to afford a mortgage and is based solely on your income. Basically, it is useless in predicting whether or not the lender will fund the mortgage.
If you’re serious about buying a home, you’re going to want to confirm with the bank whether the stars do in fact line up in your favour. Would they fund your mortgage? Are you pre-approved?
Compile the following before meeting with your lender:
- Social insurance number of each buyer
- Each buyer’s tax notice of assessment for current and previous 2 years
- Each buyer’s most recent bank statement
- If you are using RRSPs, GIC’s or other term deposits, a copy of all recent investment statements
- A letter of employment from each buyer’s employer
Tell your real estate agent, and start shopping!