With mortgage rates and home prices falling and inventory way up, it's a home buyer's market in Alberta. But the US housing crisis and the global recession has made Canadian lenders more selective about who gets mortgage financing. Remember, obtaining a mortgage is privilege, not a right. A little more preparation on your part could be the difference between approval and rejection.
Here are five things you could do to help your chances of getting approved:
1. Because your credit rating will affect the mortgage terms and rate that the lender offers you, make at least the minimum payment by the due date on your outstanding bills. Better yet, pay your bills off in full every month and reduce the number of unnecessary credit applications. For example, credit card kiosks at the airport or malls will do credit checks on you when you apply, which can negatively affect your credit score. One of the many advantages of working with a mortgage broker is that s/he will share your credit rating with you before approaching lenders.
2. Know the total amount you are willing to spend on your mortgage per month. This amount should include mortgage payment, property tax payment, home insurance, utilities, and any applicable condo fees, purchase closing costs, and other associated fees.
3. Have proof of your employment history.
4. Have your personal information handy, such as social insurance (SIN) number, date of birth, contact information and three-year history of residences.
5. Have your basic net worth information available, including an account of any assets and liabilities.