Written by Lisa Sly   |   Posted on   |   986 views

Getting pre-approved for a mortgage involves employment verification, proof of income, and a credit check, but there’s a few more things you should know. The pre-approval process is important to knowing how much the bank is willing to lend you.  Knowing how to get pre-approved for a mortgage will help speed up the buying process and get you into your new home faster.

Sections in this document

  • Setting A Budget
  • Mortgages From The Bank
  • Mortgages From Credit Unions
  • Mortgage Brokers
  • Money Needed on Hand


No one chooses to be house-poor, so knowing what size mortgage you can afford is important. You might have a rough idea of what your budget is but you won’t know for sure until you are pre-approved for a mortgage. Below you’ll find tips on how to set your budget and get pre-approved for a mortgage.


MORTGAGES FROM THE BANKcartoon picture of bank

One of the most common places to get a mortgage is at your bank. You don’t necessarily need to go to the bank where you hold your chequing and savings accounts. However, they will often offer incentives to you to keep your mortgage with them.

You will need to do the legwork and check with multiple banks yourself to see who has the best deal for your situation. Be aware—if your credit rating isn’t great, certain banks may impose a higher interest rate. They may even reject your pre-approval entirely.


With regards to mortgages, banks offer a lot of products. While interest rates are an important factor in choosing a mortgage, you will also want to consider the other options they offer

  • VARIABLE vs FIXED RATES: They should be able to tell you what the interest rate would be if you locked in at a “Fixed Rate“; or if you were to ride the highs and lows of a “Variable Rate“—depending on the national interest rate.
  • PAYING OFF LUMP SUMS: If you come into some extra money, how often can you pay off a lump-sum of the mortgage?
  • PENALTIES FOR BREAKING THE MORTGAGE EARLY: If you should decide to sell your home and break your mortgage before the mortgage is up for renewal, what would the penalties be?


Banks try to make the process of applying for a mortgage very streamlined and consumer-friendly. You provide them with the information they need, they plug it into their system, and a computer decides if you’re approved or not.

This process may take a few days to a week to return the results. With automated systems, you’re letting the bank’s computer system decide whether you should be approved or not. This can make you feel like they’re taking the human influence out of the decision process. For others, the automated process is preferred because they just want a quick answer.


Something else to consider with big banks is their customer service. Will you be assigned an actual mortgage specialist that will quickly answer your questions? Or will your call be shuffled to a large call centre where random ‘agents’ help? Before you decide to go with your bank for a mortgage make sure to ask them these questions.


Credit Unions are nonprofit organizations and similar to banks. They are considered lending institutions where you can become a member of. As a member you hold shares in the credit union. Credit unions thrive on customer service, a sense of community, and remembering your birthday.

Each credit union will have their own set of interest rates, features, and options but like banks, you should shop around to find one that works for you.


Credit unions usually have fewer mortgage products than banks and this is where they fall short. They do have one major advantage over the big banks: they offer lower rates and other advantages to its members based on the previous year’s profits. This is a great advantage because your home is one of the biggest purchases you’ll make in your life—and that’s a lot of interest.


Most of the time the pre-approval process takes a little longer than the banks because of the credit union’s underwriting system. If you’re considering using a credit union instead of a bank, make sure to leave ample time to shop around and get your pre-approval before you start looking for a home.


Customer service is what credit unions pride themselves on. They address you by name, they ask about your family, and they want to make sure you’ll tell your friend about your experience with them. If great customer service and support is something that is important to you, you should probably give the little credit union a try.


MORTGAGE BROKERSmortgage broker

The biggest benefit to using a mortgage broker is that they do all the legwork for you—there’s a lot. They are the ones who will shop around for the best mortgage rates, and research the best options with various banks, credit unions and private lenders.

Mortgage brokers are experts at getting creative and finding different ways of financing your home purchase. There’s usually no upfront costs to using a broker because the majority of them are paid by the lender.


Every product imaginable is at your mortgage broker’s fingertips. If your credit is less-than-perfect, a mortgage broker will shop around to various lenders for you. They’ll even talk to private lenders who may be willing to give you the loan. This is something you won’t be able to do through a bank or credit union.


Generally mortgage brokers are fairly quick at what they do because it’s all they do. They are quite familiar with different lenders and what the current rates and promotions are. They’re able to find you a multitude of options rather quickly.


With a broker you will always have one person to contact. If you have questions about your financing or want to make any changes to your mortgage, you’ll talk to your original broker. This is preferred if you like having one point-of-contact for all everything related to your financing.


Besides your mortgage, you will also have these expenses and will need this money in your bank account:

  • YOUR DEPOSIT PAYMENT: Your deposit needs to be paid within 24 hours of an accepted offer.  This will show you’re serious about buying the home. This is usually approximately between $2000-$10,000 depending on the property, and is a part of your overall down payment.
  • CLOSING COSTS/LAND TRANSFER TAX: These are taxes you pay to the province for switching the owner of the land into your name. The amount you pay depends on how much you’re buying the house for.
  • HOME INSPECTIONS: Inspections are optional but very important in the home buying process. It’s a good idea to set aside a budget for this too.
  • LAWYER FEES: Lawyer fees are paid to the lawyer that is doing the closing paperwork on your home.

After you’re pre-approved, you can read our article on using a REALTOR® when buying a home instead of doing it privately.

*All information provided by the Brantford Regional Real Estate Association (BRREA) and ITSO for the highest number of completed transactions since January 1, 2015. All Brantford MLS® House Listings come from the various systems operated by Real Estate Boards and Associations across Canada. The trademarks REALTOR®, REALTORS® and the REALTOR® logo are controlled by The Canadian Real Estate Association (CREA) and identify real estate professionals who are members of CREA. Used underlicense. The trademarks MLS®, Multiple Listing Service®, and the associated logos are owned by The Canadian Real Estate Association (CREA) and identify the quality of services provided by real estate professionals who are members of CREA. Used under license.



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