How important is it to get a pre-approval for my purchase or re-finance?

A pre-approval is very important in the process of obtaining mortgage financing whether it be for the purchase of a home or for the purpose of re-financing your existing home for renovations, investments or a major purchase of a variety of durable consumer goods when an existing homeowner is looking to minimize their payments by amortizing their loan over a longer period of time. Pre-approvals allow home buyers the opportunity to determine exactly what they qualify for before they commit to an offer of purchase along with providing them a guarantee on the rate for the term of their choice for 120 days.

In the case of a re-finance, a pre-approval allows the client the opportunity to determine how much of an investment they can make, how much they can afford in renovations, or just how much they can afford to spend on other items using the equity in their home. Pre-approvals are also usually a good idea when a client is considering a switch or a re-finance, (especially in a rising interest rate environment); because the rate again is guaranteed for a period of 120 days as opposed to the typical 60-90 days that the Banks offer under their rate hold policy.

Please feel free to contact us for some free advice.