If you are in the market to buy a new house, there is a specific process to follow for more which usually starts with a mortgage pre-approval. When you are pre-approved, you can start your property search and also work with the mortgage broker to assist you throughout the entire process.
Buying a house can be quite a big investment, which is why you need to start by planning a pre-approval. Once you have this, you will know exactly how much you can afford, and also know the price range that you will qualify for when searching for properties.
Getting pre-approved for a mortgage
As mentioned, this is the first step in obtaining a mortgage. Your best option is to work with an experienced mortgage broker, as they will be able to present you with various options as well as guide you through the entire process. There is often a lot of paperwork involved in applying for a mortgage and you have to consider aspects such as your affordability, your credit rating, and more.
There are various aspects banks or financial institutions will look at when they consider your mortgage application. This will include your credit score, your current financial position, as well as your income and your current debt. This will help them to determine whether or not you are pre-approved, as well as a specific amount that you are pre-approved for.
As from January 1st, 2018, you will need to pass a ‘stress test’ when you put down a mortgage deposit of 20% or more. This is basically an additional requirement to ensure that you will be able to handle an increase in interest rates, should it happen. This will be another requirement before you will be able to obtain a pre-approval for your mortgage.
Begin your property search
Once you have obtained pre-approval, you can begin your property search. You can have a look at various properties that may comply with your requirements, as well as those within your allowed budget. When you browse for new properties, working with a realtor is a great option if you want to have access to various properties in a specific area. Working with a professional who can help you to find the ideal property is recommended to help keep the process less stressful for you. They can also assist you with a pre-purchase inspection and help you to evaluate multiple properties in the specific area.
For more information about mortgage pre-approval and how to apply for a new mortgage, contact Mortgage Guys. We are experienced mortgage brokers and can assist you throughout your entire mortgage application process.