If you are applying for a mortgage for the first time or you’re a seasoned investor, there are several important things to consider that will make your home buying process as simple as possible. Let’s outline some tips that will best position you when the time comes to apply for a mortgage.


Be timely with your bill payments

Perhaps an obvious, but when applying for a mortgage, it’s important you have a good credit rating. This includes paying all your bills on time, without exception. Any yes, that late payment on your cell phone counts too! A late payment will negatively affect your credit score, and that can play a part in whether you’re approved for financing and ultimately, the rate and term you may receive.

This should apply even after your mortgage closes. A good credit rating is key to getting good rates and terms on all types of financing, now and in the future.

Employment Changes

Having a stable employment history is important if you want to purchase a home. Income stream is a major factor in determining your qualification for a mortgage. Requirements vary depending on the type of employment you have, but for most salaried borrowers, there is no specific time on the job required, as long as you are not on a probationary period.  Lenders like to see a two-year work history, which includes consideration for education, if applicable.

If you are planning a change, and it for the better, that’s great. However, if changing industries or going from a salary to a commissioned basis or hourly basis without guaranteed hours, this may affect your ability to qualify.

Do Your Own Research

There are so many mortgage options available, and with all the rule changes, lenders are now forced to categorize each available option even further. You practically need a GPS system just to navigate through it all. While the Mortgage Experts at The Financial Forum will work with you to find your options, it’s also important for you to educate yourself on the basics so that you have a general idea of your options before getting into a formal application.

Don’t forget, you are not only researching rates. Terms, conditions, pre-payment privileges, penalties, fees, all play a major part in your decision and what’s right for you.

See What You Can Afford

Get formal Mortgage Pre-Approval. Get formal Mortgage Pre-Approval. Get formal Mortgage Pre-Approval. Sorry if I am stressing this too much, but please get a formal Mortgage Pre-Approval. Don’t be surprised later.

After you’ve taken the time to do some research, it’s time to see how much you can afford and if you qualify. Sure, you can go through some calculators and get an idea, but it’s now time to speak to a mortgage expert and get things done.

Every situation is different. You may have costs in your monthly budget that affect your bottom line, such as childcare, car payments or student loans – the important thing is to find a monthly payment that you’re comfortable with, but also one that meets the guidelines of lending institutions.

Choose Wisely

Most people calling in for a mortgage start with, ‘What’s your rate? Rate is so critical in your borrowing decision. However, it is equally critical for you to realize that is the complete opposite of what you should be doing to find the right lender and the financing you need. It takes a few minutes to get a rate quoted. However, you will be spending perhaps the next 15 to 30 years paying for your mortgage. You can’t afford to mess this up.

  • Why a mortgage broker is your best option?
  • Get independent advice on your financial options
  • Save time with one-stop shopping
  • We negotiate on your behalf
  • More choice means more competitive rates
  • Ensure that you’re getting the best rates and terms
  • Get access to special deals
  • Things move quickly!
  • Get expert advice.
  • No cost to you.
  • Ongoing support and consultation.

Hold Off on Opening New Accounts

No new car loan payments, furniture loans, etc. Any addition to your monthly payments will have a negative impact. Oh, and even if you are approved for your mortgage and getting ready to close, you must hold off until you discuss with your lender.

Each loan is comprised of different terms and conditions, and taking on more debt could impact the loan you receive or change one already in process.

Hold Off on Closing Existing Accounts

When applying for a mortgage, don’t close your existing accounts, even if they have a $0 balance. This can affect items being reported and a closed account will still appear on your credit after you close it for several years. Optically, it does not look as good as a current account would.

Have any questions, need any advice? Visit us at www.thefinancialforum.ca. Email us at mortgages@thefinancialforum.ca. Call us at (905) 265-0246.

VERICO The Financial Forum Ltd.

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