People however find this first step difficult. If you are looking to apply for a mortgage in the near future, here are 7 tips that can help you to get approved more easily. 

  • Check your credit score

The better your credit score, the easier it will be for you to get approved for a mortgage. In Canada, everyone has a credit score between 300 and 900. To get a mortgage with a traditional lender, you will require a credit score of at least 600. But even if you have a lower credit score, you may still be able to get a mortgage with a private lender. 

The purpose of checking your credit score and your credit report is to make sure that it’s accurate and that there aren’t any debts or accounts listed there that aren’t actually yours. If there are, checking this early gives you time to work with the credit bureaus to correct this. You will also have more time to work on improving your score if it’s too low. 

  • Save a larger down payment

In most cases when you buy a house, you will need to have a down payment of at least 5%. But when you save an even larger down payment, it demonstrates to potential lenders that you are good with your money and will be more likely to be able to make your mortgage payments. This gives you a better chance of being approved for a mortgage. 

  • Keep your income stable

When you are in the process of purchasing a home, lenders want to see that you have a reliable income. This is not the time to quit your day job. If you work on a casual basis or have irregular income, it may be a good time to find more steady employment. 

  • Pay down existing debt

In addition to your credit score and income, potential lenders are also going to be looking at your assets and liabilities. If you have a large amount of other debts, this is going to be a red flag and could hurt your chances of getting approved for a mortgage. 

If your dream is to purchase a home, start preparing now by paying off those large debts! You don’t necessary have to pay them down to $0 to get approved for a mortgage, but you should be making steady progress. 

  • Get a mortgage pre-approval

Getting a mortgage pre-approval will let you know how much of a mortgage you can get and at what rate. Once you get a mortgage preapproval, the rate you qualify for is locked in for up to 120 days. If rates go down during that timeframe, you can get the lower rate but if they go up, you are not stuck with the higher rate if you purchase a home during that time. 

  • Work with a mortgage broker

When you work with a mortgage broker, they will shop around on your behalf to find you the best interest rate. Working with a mortgage broker also helps increase your chances of being approved for a mortgage – particularly if you are in need of a specialty mortgage such as a self-employed mortgage or bad credit mortgage. 

  • Know what you can afford

Your mortgage lender will approve you for a certain amount based on your credit score, income, assets and liabilities, but only you know what you spend on your day to day living. Have a good sense of what you can afford and what you can’t. You don’t have to spend the maximum amount that you were approved for if you feel uncomfortable with that. 

Contact Sure Loan for You

Are you looking to get approved for a mortgage? We can help. Call us today to speak with one of our brokers. 

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