Updated May 2023
As a seasoned mortgage professional, I understand how securing a mortgage and purchasing a new home can feel overwhelming even to seasoned investors. Fortunately, I can assure you that this doesn’t have to be the case. Here are some of the best home loan approval tips to get you started.
By educating yourself and preparing for the steps of the process that lie ahead, you can go a long way toward reducing the amount of stress that you will feel. As your Hamilton mortgage broker, I can help you understand these steps to navigate through the process.
Many people find that one of the most stressful parts of the entire mortgage process will be the lead-up, to actually receiving the approval for their mortgage. The good news is that you can begin to prepare early by taking advantage of the following tips for getting your mortgage approved.
- Check Your Credit Rating in Advance
One of the most important factors involved in deciding how much of a mortgage you will be approved for and at what interest rate is your credit score, which is determined from your credit report from Equifax. To ensure that you won’t have any surprises and in good shape, check your credit well before you plan on applying for a mortgage. By doing so you will have time to address any errors and glitches that you weren’t aware of that could negatively affect the outcome of your mortgage application. Such errors could include erroneous information mistakenly placed on your credit report, small collections placed by cell phone or utility companies that you weren’t aware of, etc. You will want to identify such issues as early as possible so you can effectively address them in a timely manner. The last time you want to find out that there is an issue is the after you make an offer on a home! Wow, talk about stress!
As your Hamilton mortgage broker, I can offer tips on increasing your credit score as part of the mortgage consultation process.
Prospective lenders want to see that you have built strong overall credit, that you have adequate savings or will be receiving a financial gift from a relative and that your income is stable and adequate to support the mortgage payment, property taxes, along with any additional obligations such as car loans.
- Get Pre-Qualified
Working with your Hamilton mortgage broker to obtain a pre-qualification is a great way to make sure you are on the right track with your income, savings and credit to make the lead-up to making an offer free of surprises and stress-free. Getting pre-qualified for your mortgage doesn’t guarantee that you will ultimately be approved for a mortgage, however, it does give you a pretty good idea about whether or not you will get approved and the mortgage amount that you should expect to be approved for. Even failing to get pre-qualified can show you what areas of your finances you need to work on improving before you apply for your mortgage.
- Keep Spending in Check
If you are in good shape to be approved for your mortgage and successfully obtain a pre-qualification, don’t take that as the go-ahead to increase your spending habits or make purchases of any big-ticket items. Excessive spending before you are officially approved for your mortgage can also negatively impact your chances of being approved for your loan. Even once you are approved for the mortgage, don’t make any changes such as financing a car, or co-signing for a loan for mortgage. If the lender were to find out before closing, they could cancel your approval.
- Maintain Your Employment and Income Through the Process
It is also important to remember that your employment and current income are taken into consideration during the approval process, so losing or quitting your job or any other major changes like moving to a different company can have a major impact on your approval.
If you are considering any changes before or following your pre-qualification, make sure to reach out to your mortgage broker to discuss.
As you can see having these mortgage approval tips in mind when you are starting out with the mortgage process can save you a lot of headaches and stress down the road.
We are more than happy to help you on this journey!