Mortgage Services

Mortgage Pre-Approval: The Pre-Purchase Step

If you are considering buying, selling or investing in real estate, get pre-approved for a loan before you start looking for properties. You’ll need to provide your income, assets and debts, as well as any other information lenders may ask for. If you are considering

Why should I get pre-approved?
Pre-approval: To increase your credibility with sellers, and freeze your interest rate.

Before showing you properties for sale, many real estate brokers require a mortgage pre-qualification: it shows them your seriousness and credibility as a buyer.

This contract allows you to lock in the best current interest rate you have obtained. This protects you from any potential rate increases. You can lock in your rate for 30 to 150 days.

Your Multi-Prêts broker will guide you through the five simple steps:

Step 1

Step 1: Determine your borrowing capacity and apply

Applying for a mortgage does not affect your credit rating. If you are approved, your score increases. If you send multiple applications for mortgages and you are declined, your scoring may be hit. Using Lily Morel services is the guarantee to apply only once for the best mortgage.

Banks and financial institutions in Canada may refuse certain types of applications.

The Multi-Prêts mortgage broker is an intermediary between the borrowers and the lenders. By entrusting them with the pre-approval phase, the applications made will be beneficial to your credit rating. A broker can also give you an idea of the amount you could receive.

Step 2: Calculate Ability to Repay

If you have a car rental, personal loan, student loan, outstanding credit card or any other debt, you need to subtract it from your net income to determine if you can afford to pay back what you owe.

Other expenses, such as groceries, outings, gas, vehicle maintenance, should also be considered in order to establish an accurate budget. Don’t forget taxes, transfers, notary, inspections and appraisals.

A mortgage broker will help you calculate how much you can afford to pay for your loan.

Step 3: Calculate the debt-to-equity ratio

Your credit score is an important factor when applying for a mortgage. You can check your credit score at any time using a free online service like Credit Karma. Your credit score is calculated based on your payment history, the length of your credit history, the types of credit accounts you hold and other factors. Your credit score is not the same as your FICO score, which is a proprietary scoring system used by lenders to determine if you qualify for a mortgage.

Other ratios also considered

Total Debt Service Ratio (TDS)

After paying all your other commitments and bills, this is the amount of money you have to spend each month to buy a home. The calculation includes any other monthly payments you may have, such as loans or credit cards, to determine what you have to pay each month.

Gross Debt Service Ratio (GDS)

This is what you will have to pay each month to own a home. You will also have to pay an additional amount for taxes, insurance and other expenses.

Step 4: Submit your application

You will need to provide your broker with:

1) Personal information;

2) Financial information (bank statements, tax returns, notices of assessment from previous years, significant assets you own or debts, etc.).

3) Financial information includes items such as pay stubs, tax returns, previous years’ tax notices, funds in your current bank account, significant assets you own (such as homes), debts, etc.

Your credit score should also be considered. A high credit score means you are less likely to default on your loan.

You must put down a minimum of 5% of the purchase price when you apply for financing. However, if you want to get the best interest rate on the market, you should put down a deposit of at least 20% of the total cost of the home. This way, you won’t have to go through CMHC.

Step 5: Choose an option

You can borrow money from several banks at once. You just have to choose one of them. A Multi-Prêts broker will tell you which bank offers the best interest rate.

If your application is rejected because the bank feels you are not profitable enough, your broker will do everything possible to get you approved. He or she may suggest that you lower the price of the homes you are willing to buy, find a way to increase your down payment, consider getting a co-signer or even sell your current home.

Loan approval does not guarantee that you will get the money you need. You may lose your job, get divorced or experience other life changes that could cause the deal to fall through.

Step 1

Step 1: Determine your borrowing capacity and apply

Applying for a mortgage does not affect your credit rating. If you are approved, your score increases. If you send multiple applications for mortgages and you are declined, your scoring may be hit. Using Nadia services is the guarantee to apply only once for the best mortgage.

Banks and financial institutions in Canada may refuse certain types of applications.

The Multi-Prêts mortgage broker is an intermediary between the borrowers and the lenders. By entrusting them with the pre-approval phase, the applications made will be beneficial to your credit rating. A broker can also give you an idea of the amount you could receive.
Step 2

Step 2: Calculate Ability to Repay

If you have a car rental, personal loan, student loan, outstanding credit card or any other debt, you need to subtract it from your net income to determine if you can afford to pay back what you owe.

Other expenses, such as groceries, outings, gas, vehicle maintenance, should also be considered in order to establish an accurate budget. Don’t forget taxes, transfers, notary, inspections and appraisals.

A mortgage broker will help you calculate how much you can afford to pay for your loan.
Step 3

Step 3: Calculate the debt-to-equity ratio

Your credit score is an important factor when applying for a mortgage. You can check your credit score at any time using a free online service like Credit Karma. Your credit score is calculated based on your payment history, the length of your credit history, the types of credit accounts you hold and other factors. Your credit score is not the same as your FICO score, which is a proprietary scoring system used by lenders to determine if you qualify for a mortgage.

Other ratios also considered

Total Debt Service Ratio (TDS)

After paying all your other commitments and bills, this is the amount of money you have to spend each month to buy a home. The calculation includes any other monthly payments you may have, such as loans or credit cards, to determine what you have to pay each month.

Gross Debt Service Ratio (GDS)

This is what you will have to pay each month to own a home. You will also have to pay an additional amount for taxes, insurance and other expenses.
Step 4

Step 4: Submit your application

You will need to provide your broker with:

1) Personal information;

2) Financial information (bank statements, tax returns, notices of assessment from previous years, significant assets you own or debts, etc.).

3) Financial information includes items such as pay stubs, tax returns, previous years’ tax notices, funds in your current bank account, significant assets you own (such as homes), debts, etc.

Your credit score should also be considered. A high credit score means you are less likely to default on your loan.

You must put down a minimum of 5% of the purchase price when you apply for financing. However, if you want to get the best interest rate on the market, you should put down a deposit of at least 20% of the total cost of the home. This way, you won’t have to go through CMHC.
Step 5

Step 5: Choose an option

You can borrow money from several banks at once. You just have to choose one of them. A Multi-Prêts broker will tell you which bank offers the best interest rate.

If your application is rejected because the bank feels you are not profitable enough, your broker will do everything possible to get you approved. He or she may suggest that you lower the price of the homes you are willing to buy, find a way to increase your down payment, consider getting a co-signer or even sell your current home.

Loan approval does not guarantee that you will get the money you need. You may lose your job, get divorced or experience other life changes that could cause the deal to fall through.

Getting Pre-Approved

Pre-qualification: To get an idea of our credit capacity

Pre-qualification is an important step in the mortgage process.
It gives you an idea of the type of loan you may qualify for before you even apply.
Pre-qualification will give you a rough estimate of the amount you can borrow.
You may not need to go through the full pre-approval process if you are sure you qualify for a higher amount.

Do I need a letter to prove my mortgage pre-qualification?
Lock in your rates several months in advance to protect yourself from price increases.
Never run out of Multi-Prêts

Many potential buyers who haven’t turned to a mortgage broker wait too long to gather the information they need to buy a home. The result? They miss out on an opportunity that may not come up again anytime soon.

When you work with a mortgage broker, they will help you build your credit profile to minimize your time and maximize your borrowing capacity. This will allow you to be ready when the opportunity to purchase a property arises.

He will also help you negotiate the best mortgage rates and conditions available on the market that suit your current and future needs. In short, a Multi-Prêts broker plans your mortgage for you so that you are never caught short.

Get Pre-Qualified

How do I get a mortgage to buy a home?

A long process

With a mortgage broker, this long process becomes very simple. They will guide you through the various steps, always presenting you with several proposals. They will ask you for all the necessary documents and then negotiate with different lenders on your behalf. Mortgage brokers can therefore save you a lot of hassle such as negotiating with banks and other financial institutions, searching for important documents and this, totally free of charge. You will be able to concentrate on finding your property while your broker takes care of your file. You will have concrete figures, such as your borrowing capacity and an estimate of your mortgage payments, on which you can base your analysis of a property.

A lot of documentation to provide

To verify that the amount you are requesting for your mortgage loan matches your ability to repay and to assess the level of risk involved, the lender may ask you for the following, among other things

Your most recent pay stubs or tax returns ;
Your credit rating;
your debt-to-income ratio the value of the property;
the purchase agreement.

The actual application

A bank or institution that is considering giving you a loan will have you fill out an application form. If necessary, they may also ask you to provide additional information about your finances. Ultimately, they will either approve or deny your application.

Sign the acceptance form

Before signing the approval acceptance form, the lender may ask for additional information, sometimes in great detail. Once the lender has all the information they need, they will proceed to approve the loan.

I want to buy

Renew my mortgage

Can we renegotiate the terms of our loan when we renew our mortgage?

At your renewal, which you can do 6 months before the end of your term, you can change the terms of your mortgage. This is a good time to reassess your financial needs. If the terms of your old mortgage no longer suit you due to a change in circumstances, you can adjust your mortgage by changing the payment frequency, term or rate options.

What do I need to know when my mortgage comes up for renewal?
Your lender will send you a notice at the beginning of your term that your loan is about to expire. If you have chosen to receive notices electronically, your lender will also send you an electronic reminder.

This notice contains:

the total amount of your loan ;

the monthly payments requested;

the interest rate
the term;

the expiry date of the loan;

the terms of the loan;

the management fees.

When you apply for a loan, your bank will usually make you several offers. You will then have to choose the best one. Your Multi-Prêts broker will help you find the right offer.

If you do not respond to this message, we will consider that you have read it and that you accept the conditions.

Your renewal is automatic, with the conditions indicated in the notice. You will also receive an email reminder before your payment date. Remember to check your account regularly to see if there are any changes in your payments, interest rates or other information.
Changes that affect your ability to pay

When refinancing your mortgage, consider the financial implications of any changes you may make.

If you can afford a larger mortgage payment, even if you can make an extra payment, don’t hesitate; it will be worth it in the long run.

If you’re having trouble paying your bills, consider consolidating your debts. You may be able to lower your interest rates and save money in the long run. If you don’t know what to do, talk to your bank about refinancing your mortgage.

Remember to negotiate your interest rate and loan terms (or have a mortgage broker do it). To do so, keep up to date with the market a few weeks before the end of your contract, and consult the current rates on the Multi-Prêts website.
Competition between lenders for the benefit of borrowers
If you are looking for a job at the end of your contract, you will have to prove yourself first. You can also get better terms if you have proven your reliability and financial stability by working at your current company.

Your current lender may be willing to go to great lengths to keep you as a customer.

Ask your current lender to match any offers you receive from competing lenders.

Because, if you change banks, you will have no choice but to assume :

the penalties for breaking the contract ;

the cost of modifying the mortgage ;

the cost of the home appraisal;

other additional administrative costs.

However, you may not be able to ask your lender to absorb all or part of these costs.

Getting my renewal

To pay off your debts, invest in your home or renovate your home.

Your property, the key to achieving your goals

Refinancing your mortgage consists of borrowing the desired amount from your bank to pay off your debts, which are costing you a lot in interest.

Le refinancement peut également être utilisé aux fins suivantes:

buy a car or a snowmobile;
Extend your house or renovate;
start a business;
buy an income property

What if I decide to refinance my mortgage?

You can refinance your mortgage at any time during the term of your loan. However, you will be charged a penalty if you do so before the end of the term. Your lender will tell you the amount of this penalty.

Your Multi-Prêts broker can then compare refinancing with other available loan options, including higher interest rates.

You can refinance up to 80% of the value (market value) of your property (house, cottage, condo or complex).

Get my refinance

Mortgage Services

Mortgage Pre-Approval: The Pre-Purchase Step