With a pre-approval, you’ll get a good sense of how much you can afford, and you’ll be assured of a particular mortgage rate for a set period of time. With a locked-in rate, there is no risk of interest rate increases while you are house hunting. A mortgage broker may be able to obtain a longer pre-approval rate hold. Another benefit of a pre-approval is that you’ll be in a much better position to negotiate with sellers.
On the other hand, a pre-approval is not a rock-solid guarantee of financing, does not eliminate the need to make a conditional offer, and you still must consider all closing costs.
I always recommend that you get a pre-approval in person. While it is possible to get pre-approval over the phone or internet, you will get the most value by meeting your mortgage broker one-on-one. This will allow you to ask questions, run scenarios and learn all your options different options. Remember, the amount you are qualified to purchase is not just ONE number. It is a range of amounts based on several factors such as your income, the lender, the interest rate, the down payment, your credit, the type of property, etc. When you are meeting your mortgage broker, he/she should be able to run through the various amounts you will be qualified to purchase.
Learn more about the pre-approval process at BCMortgage.ca by visiting our website.
