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Should You Prepay Your Mortgage? – Pros And Cons

by | Aug 31, 2023 | Mortgage FAQ

5 Reasons To Get Pre-Approved For A Mortgage

Ready to embark on the exciting journey of becoming a homeowner in Canada?

Before you start scrolling through home listings and attending open houses, there’s an essential step not worth skipping – getting pre-approved for a mortgage.

If you’re wondering why this step is so important, keep reading to discover the five compelling reasons why you should get pre-approval for your mortgage financing before diving into the process of purchasing a home.

5 Reasons To Get Pre-Approved For A Mortgage

Let’s look at the top 5 benefits of getting approved for a mortgage beforehand when buying a home –

#1 – Know Your Budget and Price Range

Obtaining a mortgage pre-approval involves a thorough review of your financial documents, including your credit score, income, and employment history.

If any concerns are identified, you’ll have the opportunity to address them before they impact your ability to secure a mortgage.

Knowing exactly how much you can afford helps streamline your home search, preventing the disappointment of falling in love with a property that’s out of reach.

#2 – Strengthen Your Negotiating Power

When you’re pre-approved for a mortgage, you’re demonstrating to sellers that you’re a qualified and serious buyer. This can give you an edge when it comes to negotiations and making offers.

Sellers are more likely to take you seriously and consider your offers favorably when they see that you’ve taken the initiative to secure your financing beforehand.

Your pre-approval letter speaks volumes about your commitment and financial readiness to move forward with the purchase.

#3 – Lock in Your Mortgage Rate

In the ever-fluctuating world of mortgage rates, one thing is certain: they can impact the total cost of your loan.

By obtaining a pre-approval, you’re not only locking in an interest rate for up to 120 days but also safeguarding yourself against potential rate hikes during that period.

Even if rates rise, you’ll still enjoy the lower rate you secured with your pre-approval. And, in the fortunate event that rates drop, you can even be re-approved for the lower rate, ensuring you get the best deal possible.

#4 – Streamlined Home Buying Process

With a pre-approved mortgage in hand, you’ve already tackled a significant portion of the paperwork. Sellers appreciate pre-approved buyers because it demonstrates that you’re a serious contender, ready to seal the deal.

Your pre-approval sets you apart from other potential buyers, giving you a competitive edge in a dynamic real estate market. It also speeds up the overall mortgage approval process, allowing you to close the deal more efficiently.

#5 – Act Quickly in a Fast-Moving Market

The real estate market can move swiftly, and sometimes, you need to act fast to secure the home you desire.

Having a pre-approval in hand gives you the confidence to make an offer without delay, increasing your chances of landing your ideal property.

FAQs On Getting Pre-Approved For Your Mortgage

Can I still get approved if I am a first-time home buyer?

Absolutely! Mortgage pre-approval is available to both first-time home buyers in Edmonton and even those with previous experience. It’s a valuable tool for anyone entering the housing market.

Does pre-approval guarantee I’ll get a mortgage?

Pre-approval provides a strong indication of your eligibility, but it isn’t an absolute guarantee. Final mortgage approval depends on factors such as the property appraisal and additional documentation.

Can I make multiple offers with one pre-approval?

Yes, you can use your pre-approval to make offers on multiple properties. However, keep in mind that each offer will still be subject to the property’s appraisal and your financial situation at the time of the offer.

What’s the difference between pre-approval and pre-qualification?

Mortgage pre-qualification provides an estimate of how much you might be able to borrow based on basic financial information, while pre-approval involves a more rigorous evaluation and provides a specific loan amount you’re qualified for.

Read More – Mortgage Pre-qualification vs Pre-approval

Let Us Help You Apply For Pre-Approval

Factors To Consider Before Prepaying A Mortgage

Ready to take the first step towards homeownership? At Sandra Forscutt, we’re committed to helping you navigate the mortgage pre-approval process.

It not only provides you with a clear budget and price range but also enhances your negotiating power and expedites the buying process.

So, before you start searching for your dream home in Canada, take the time to get pre-approved – you’ll be glad you did.

Our team of experienced Edmonton mortgage brokers will guide you through every step, ensuring you’re well-prepared to find and secure your dream home.

Contact us today to get started on your journey!

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