Category Archives: New to Canada

Applying for a mortgage loan – what do I need to know?

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When I speak to prospective clients they ask me what information will they need to prepare, in order to complete their mortgage loan application. I have prepared this blog article as I thought it would help you prepare for our meeting.

The mortgage loan application requests information about the type of mortgage loan you are applying for, as well as your personal financial situation.
To fill out the Mortgage Application , you (and the co-borrower, if you have one) need to provide the following information:

Employment history – I require 3 years history of where you work, (have worked) including address, your job title and income

Income – how are you paid?
• Hourly
• Salary
• Do you earn overtime or bonuses
• 100% commission
• Self employed
• Permanent pension income

Where do you live now – I need 3 years history of where you live (have lived). Do you rent? Or Own?
Do you own your current property? I need the details of the residence plus the information on the current mortgage holder.

Debts – What are your current debts / liabilities. Your own debts plus any you might have co-signed
• Credit cards
• Bank loan, car loan or lease.
• Alimony or child support obligations
• Any bankruptcy history
• Any legal actions you are involved in
• Foreclosure history

Citizenship status – there are a variety of lending programs depending on if you are New to Canada, permanent resident, non-permanent resident, U.S. non-permanent resident

Assets
• Current value of RRSP’s
• Stocks & bonds, mutual funds
• Tax free savings
• Savings
• Value of the automobiles you own
• Value of other major assets (big boat)
• Value of other properties you own

Down Payment – What is the source of your down payment and closing costs. How much will you put down?
• Will you provide it from your own savings?
• RRSP’s
• Receiving a Gift from your immediate family member?
• Borrow it from your line of credit?

Paperwork – What is the minimum you should have available when we meet?
For our initial meeting it is ideal if you have your last two years of income tax returns and/or notice of assessment and a current paystub. I want to accurately establish what is your gross income, as this will avoid stress and frustration when you have found the home you want to buy.

The reality is that in order to do my best for you as your mortgage planner, to ensure you get approved and I get you the best available mortgage terms, conditions and rates, I need to KNOW YOU. Once I know you, your needs, goals, financial background, I am in a better position to help you reach your goal of owning and investing in your home. I will advice you of your options and the best mortgage rates, terms and conditions available to you.

If you don’t quite qualify today, I will use the information you shared to create a plan of action so you can meet your goal in the near future.

You can get started now, by accessing our secure Mortgage Application
If you have questions about planning for your mortgage or you are ready to get the process started, call me 604-726-9550. I look forward to helping you achieve that goal!

What NOT to do AFTER your mortgage has been approved and BEFORE it funds

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Generally speaking real estate buyers will include a condition “subject to financing” when buying a home.  Once the significant lender conditions have been met (such as confirmation of your ongoing employment, income and your down payment) I will provide you with the lenders mortgage commitment and a letter confirmation of the approved mortgage financing.  You can go ahead and remove the subjects on your offer to purchase, if you wish.  Once you do this you are buying that home. Therefore, your financial situation should not change significantly before the completion/closing day when the mortgage funds.  Or the money might not be there!

It is very important to remember that the lender reserves the right to review all applicant’s financial status right before closing on your mortgage.   (They can verify your debt status by pulling a new credit bureau report)   If there is a substantial change in your financial status, the lender could refuse to fund the mortgage. This would normally only happen if you could no longer “qualify” for the mortgage based on the debt servicing ratios they rely on.

I recommend you AVOID the following once you have bought a home and are waiting for the mortgage to fund:

  • Do not quit your current job
  • Do not reduce your income (go from full time to part time, take a lower paying job with the same company)
  • Do not go out and buy all the new furniture and appliances for your new home and put it on a “do not pay for a year account”
  • Do not enter into a new lease for that car you “have to have”
  • Do not rack up credit card debt
  • Do not co-sign a loan or mortgage for anyone else
  • Do not stop paying your current debts or pay late (including the current mortgage on your existing home)
  • Do not spend the money you saved for your down payment and closing costs

I specialize in working with First Time Home Buyers and New to Canada purchasers because I love to educate and support them through the home buying and financing process.  

If you or someone you care about is in the market to buy a home, please contact me @ 604-726-9550.  I will guide you so that you can easily determine which mortgage financing option  will work best for your investment decision.