Obtaining Mortgage Approval to its Fullest Potential.

With the recent waves of government mortgage rule changes, home buyers/homeowners are feeling disappointed that they have been declined or not approved by their lending institution for the financing they would like or feel they can reasonably afford. Today’s consumer does not fully understand that mortgages are no longer “cookie-cutter” and “fit in the box” for an easy, straightforward approval. It now takes a knowledgeable, well-experienced broker to manoeuvre a mortgage application. You must consider the following when applying for mortgage financing, and not all lenders have the same lending guidelines. For example:

• Qualifying Ratios: Each lender has different maximum values they consider when qualifying for the mortgage financing. The government has set “debt ratios” (called GDS & TDS) for the lenders to follow but not all lenders use the guidelines to their full potential. This means each individual lender chooses a particular amount that they will allow for the new mortgage and associated costs along with individual allowable maximums for debt, such as credit cards, loan payments, lines of credit, child support and Alimony payments, etc.
• Default Insurers: For purchases with less than 20% down payment, default (mortgage) insurance is subject to the approval of an application. In Canada, there are three mortgage insurers, and not all lenders use all three insurers
• Qualification Criteria: Knowing how a lender will qualify income sources or liabilities (self-employed, pensions, child/spousal support paid or received, vehicle payments, etc. commission, bonus, etc.) is crucial. The way these are calculated varies from lender to lender and can drastically impact the debt servicing ratios, and therefore your buying power.
• Supporting Documentation: Required paperwork for a mortgage approval can be tedious. A good mortgage broker will help streamline the paperwork required to obtain your maximum buying potential. Every lender has different documentation requirements, and it is essential to know which lenders want what paperwork, especially with the various programs for those who are self-employed.
• Legal Closing Criteria: Before the advancement of a mortgage, a lawyer will advise what pertinent documentation and funds are required to close. If there are any lender “requirements” (example: property taxes, condominium documents, file specific affidavits, etc.) that could potentially hinder a “timely” closing, an experienced mortgage broker will have insight into the requirements in advance and help “pave the way” for a smooth and “timely” closing.

A good, experienced, and knowledgeable mortgage broker considers all the above and much more when completing a mortgage application. We work for you to obtain the best mortgage options available, with as little stress as possible.