Mortgage Pre-Approval: A Step-by-Step Guide
Thinking About Buying a Home? Let’s Talk Pre-Approval
If you’re planning to buy a home, one of the first things you’ll hear is:
“You should get pre-approved.”
But what does that actually mean? Is it the same as being pre-qualified? And how do you go about it without turning the process into a second full-time job?
I work with buyers across Canada — from first-time purchasers to growing families and relocations — and one thing is consistent everywhere: a proper mortgage pre-approval changes the entire experience. This guide breaks it down in a clear, practical way so you know exactly what to expect.
Why Mortgage Pre-Approval Matters Right Now
A pre-approval isn’t just a checkbox — it’s the foundation of a smart purchase. Here’s why it matters:
Know your real budget
You’ll avoid falling in love with homes that don’t actually fit your numbers.
Protect your rate
Most lenders will hold an interest rate for 90–120 days, helping shield you from short-term market swings.
Stronger offers
Sellers take pre-approved buyers more seriously, especially in competitive markets.
Catch issues early
Credit, income, or documentation concerns can be addressed before you’re under pressure to make an offer.
Who Should Get a Pre-Approval?
Short answer: almost anyone buying a home.
Pre-approval is especially important if:
You’re a first-time home buyer
You’re relocating or buying in a new city
You’re self-employed or have variable income
You’ve had credit challenges in the past
You’re shopping in a competitive market
Even if you’re “just browsing,” a pre-approval gives you clarity and leverage.
Pre-Approval vs. Pre-Qualification: What’s the Difference?
These two get confused all the time.
Pre-qualification
A rough estimate based on numbers you provide, without verification. Helpful, but not something you can rely on.
Pre-approval
A deeper review of your income, credit, debts, and down payment. This is what gives you real confidence — and what realtors and sellers actually care about.
I focus on true pre-approvals, not guesswork.
How the Mortgage Pre-Approval Process Works
No matter where you’re buying in Canada, the steps are largely the same.
Step 1: Start With a Mortgage Professional (Not Just a Bank)
Banks can only offer their own products. As a mortgage broker, I compare options across multiple lenders to find a solution that fits your goals — not just one institution’s box.
That flexibility matters, especially if your situation isn’t perfectly “by the book.”
Step 2: Gather Your Documents
You’ll typically need:
Government-issued ID
Income verification (pay stubs or employment letter)
T4s or Notices of Assessment (two years if self-employed)
Recent bank statements
Details on existing debts
Information on your down payment (savings, RRSPs, gift, etc.)
If something here feels complicated — that’s normal. Part of my role is helping you navigate it.
Step 3: Review Your Credit
Your credit profile plays a role in both approval and pricing.
I’ll review your credit with you, explain what lenders are looking for, and talk through any concerns openly. A less-than-perfect score doesn’t automatically mean “no” — context matters.
Step 4: Compare Lenders and Secure a Rate Hold
Once everything is reviewed, I’ll:
Compare mortgage options across multiple lenders
Structure a plan that fits your purchase timeline
Secure a rate hold (usually 90–120 days)
You’ll have clarity on payments, affordability, and next steps — no surprises.
Step 5: Receive Your Pre-Approval
Your pre-approval outlines:
Your maximum purchase price
The interest rate being held
Key mortgage terms and conditions
This is your green light to start house hunting with confidence.
Step 6: Shop With Confidence
With a pre-approval in place, you can:
Move quickly when the right property comes up
Make stronger, cleaner offers
Negotiate from a position of certainty
It turns an emotional process into a strategic one.
How Much Can You Actually Afford?
Affordability depends on a few key factors:
Income
Down payment amount
Monthly debts
Credit history
Mortgage type and term
Rather than relying on online calculators, I walk clients through real numbers based on lender guidelines and their goals.
Common Pre-Approval Questions
How long does it take?
Often 24–48 hours once documents are in.
Will it hurt my credit?
One credit check has a very small, temporary impact.
What if I’m self-employed?
There are excellent options for business owners — structure and documentation are key.
How long is a pre-approval valid?
Typically 90–120 days, depending on the lender.
Final Thought
Getting pre-approved isn’t about pressure — it’s about clarity. Whether you’re buying next month or just planning ahead, understanding your options early puts you in control of the process.
If you’d like to walk through it together, I’m always happy to help.
