How to qualify for a mortgage?

Qualifying for a mortgage in Canada has four main factors:

-stable income
-credit history
-property appraised value
-down payment


All four of these factors work together to determine which mortgage options will suit your situation best, and the rate you will receive by the mortgage lender.

Stable Income whether employed or self-employed, is something mortgage lenders will want to confirm. Mortgage lenders will required a letter of employment confirmation as well as recent pay stubs and the last two years Notice of Assessment forms from CRA (these are the notices you receive after you file your taxes each year that show your income and show whether any taxes owing). The lender, at their discretion, may also call your employer to confirm the details in your employment confirmation.

Credit History credit bureau information always reviewed by mortgage lenders. If your credit isn't perfect, there are programs available to you while you rebuild your credit. A credit score of 680+ is most desirable by lenders. Please ask our MortgagePRO associate for information on how your score is calculated. A credit history is always pulled by your mortgage broker when you apply for credit or seek pre-approval so that we can determine which programs will suit your situation.

Property appraised valueProperty choices also impact the mortgage qualifying process, as the real estate is the lender's security - if for some reason - you are unable to repay the mortgage. The mortgage lender will want to be sure that the property is in good condition and that if they needed to market the property it would sell quickly. Appraisal will provide details of the marketability of the real estate. A property appraisal is almost always ordered and involves a physical inspection of the property for the lender by a certified appraiser who assesses the condition and market value of the property to be mortgaged.

Down payment is not always required as there are mortgage programs that provide 100% financing for qualified purchasers. If you have a down payment of 20% or more of the purchase price, this is known as a "conventional" mortgage, and the mortgage lender will not require default insurance (and related premiums). If you have less than 20% down, the mortgage lender will insure your mortgage against default. If you have no down payment, you generally will still need to have some cash to put down for your real estate purchase deposit and for Closing Costs (estimated at 1.5% of purchase price).

Our MortgagePRO Associates will help you get a quote how big of a mortgage you may qualify for. For specific advice on how much you qualify for please call us or email us, we are here to help. Very good idea to obtain a pre-approval, then you how much you can spend, save time for yourself and others.

We connected to all Banks and Private Lenders

Reasons to use a Mortgage Broker for the process:

Individual
approach
to

client