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What is a Mortgage Pre-Approval and Why You Need One?

October 25, 2024 | Posted by: Yelena Markus

Happy homeowners in Montreal holding keys after receiving mortgage pre-approval with Yelena Markus, a trusted mortgage broker serving Greater Montreal.
What is a Mortgage Pre-Approval?

A mortgage pre-approval gives you a clear picture of how much you can borrow and locks in your mortgage rate for up to 120 days. This critical first step ensures that you stay within budget and helps make your homebuying journey stress-free.

Benefits of Pre-Approval:

  • Secure a rate hold for 120 days.
  • Know how much you can afford before house hunting.
  • Make offers with confidence, knowing you’re pre-approved.
  • No impact on your credit score during the pre-approval process.

What is the Difference Between Pre-Approval and Pre-Qualification?

Many buyers confuse pre-qualification with pre-approval, but they are not the same:

  1. Pre-Qualification:

    • A quick financial assessment based on self-reported information.
    • No guarantee of a locked-in rate or approved amount.
    • Typically offered by smaller lenders or non-banks that avoid holding rates.
  2. Pre-Approval:

    • A deeper analysis of your income, credit, and financial situation.
    • Comes with conditions and a locked-in mortgage rate.
    • Stronger tool for making competitive offers.

Why Should You Get Pre-Approved?

In a competitive market like Montreal, having a mortgage pre-approval sets you apart. Sellers prefer buyers with pre-approval because it shows your financing is solid. Plus, it protects you from rising rates during your house hunt.


Required Documents for Pre-Approval:

When applying for pre-approval, you’ll need the following:

  • Identification: Two pieces of ID
  • Income Proof:
    • Two most recent paystubs
    • T4 statements (2022 and 2023)
    • Letter of employment (if needed)
  • Investment Property Documents (if applicable):
    • Mortgage statement, tax statements, lease agreement
  • Proof of Down Payment:
    • 90-day portfolio statement

What Happens After Pre-Approval?

Even with pre-approval, your final approval depends on:

  1. Property Valuation: Lenders need to ensure the property value matches the price.
  2. Financial Stability: Avoid big purchases or credit changes until closing.
  3. Closing Costs: Budget for legal fees, moving expenses, and potential repairs.

How I Can Help You as a Montreal Mortgage Broker

As a licensed mortgage broker in Montreal, I work with multiple lenders—from major banks to alternative lenders. Whether you’re a first-time buyer or a seasoned investor, I’ll help you:

  • Get pre-approved quickly with competitive rates.
  • Find the best mortgage product for your financial situation.
  • Secure financing even with a lower credit score or non-traditional income.

What if You’re Denied a Mortgage?

If your mortgage isn’t approved, don’t worry—there are solutions! I work with subprime lenders and private lenders who offer flexible terms. Together, we can:

  • Improve your credit score and reapply.
  • Add a co-signer or guarantor to your application.
  • Explore alternative financing options with longer amortizations.

Montreal Market Tips for Buyers

  1. Be conservative with your budget. Don’t max out your pre-approval—leave room for closing costs and home repairs.
  2. Always get an appraisal. Lenders may adjust financing based on the final property value.
  3. Plan for surprises. Set aside funds for unexpected repairs or legal costs.
  4. Stick with your current job. Lenders prefer stable income—switching jobs before closing could jeopardize your approval.

Where to Get Pre-Approved for a Mortgage in Montreal

You can get pre-approved directly through banks, mortgage companies, or private lenders. However, working with a mortgage broker like me, Yelena Markus, gives you access to more options and better rates.

As a Montreal mortgage expert, I can connect you with:

  • Banks and mortgage finance companies (MFCs)
  • Private and alternative lenders for complex situations
  • Subprime lenders for low-credit borrowers

How to Avoid Common Mistakes During the Mortgage Process

  1. Don’t apply for new credit: It can hurt your score.
  2. Avoid big purchases before closing: New debts impact your debt-to-income ratio.
  3. Prepare your documents early: This saves time and speeds up approval.
  4. Stay within your budget: Don’t let emotions drive you to overbid.

Why Work with Me?

I am Yelena Markus, a Montreal mortgage broker, and I’m here to guide you through the entire mortgage process—from pre-approval to closing. My mission is to make sure you:

  • Find the right mortgage to fit your needs.
  • Lock in competitive rates and avoid surprises.
  • Get access to exclusive lender deals you won’t find on your own.

Get Started Today!

If you’re ready to take the next step toward homeownership in Montreal, contact me for a free consultation. I’ll help you:

  1. Understand how much you qualify for.
  2. Find the best mortgage option tailored to your needs.
  3. Get pre-approved quickly and confidently.
Yelena Markus, Montreal Mortgage Broker

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