A Pre-Approval Does not Guarantee a Mortgage Approval

A Pre-Approval Does not Guarantee a Mortgage Approval

Getting a mortgage approval will require you to follow a number of steps and a pre-approval is a must. However, while this step is extremely important, buyers have to understand that a pre- approval does not guarantee a mortgage approval, so you cannot assume that everything is finalized as your mortgage pre-approval will not automatically translate into a mortgage.

The lender will still have to consider the actual property and must approve all the terms and review your documentation to then change your status from pre-approved to approved. As a buyer, you have to realize that uncertainty is part of the process, and in most cases, you will likely get approved, but this is never a guarantee, so you have to be ready for a different outcome as well.

Residential real estate is a very hot commodity at the moment, and the process is in favour of sellers, so it’s very common to go in without conditions, as this is sometimes the only way to win when dealing with a multiple-offer situation. Buyers have to know in advance the amount of mortgage they will qualify for, so a pre-approval must be obtained before you start looking for homes and sometimes, even with this certificate, you can still run into complications, which can affect your home purchase.

Pre-approvals do not consider specific properties, so the lender will not factor in the exact property you are trying to purchase. This means that the house itself can hurt your mortgage approval because certain aspects will be viewed as problematic, and things like the value of the home, property conditions, property specifics and location can all be a cause for concern. Log homes, homes on leased land and properties with aluminum wiring, for example, would all be problematic for a lender, and this would make it challenging for you to obtain a mortgage even with a pre-approval. If a listing says “as-is,” then, this too, would be an example of a problem because the lender would view this as a red flag and may not provide you with a mortgage.

It’s also possible for you to hurt your own mortgage approval, which can happen if your circumstances change or if new information comes to light. Change is not a good thing during a home-purchasing process, so a brand new car or a new job may hurt your approval. The same is true if you have a different income or if your personal taxes are not up-to-date, so you have to have a good standing and cannot miss any payments.

When it comes to mortgages, Collin Bruce is the best and will provide you with detailed information to ensure you get approved. Whether you are a first-time home buyer, require a pre- approval, need to refinance or are looking for a no down payment mortgage, we can help. Our expert brokers will provide you with the best fixed-rate mortgage and will do a comparison. We are one of the top mortgage companies in the Edmonton area, and our advisors can help with everything from reverse mortgages to second mortgages, so if you want to work with a specialist, contact us today!

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The Collin Bruce Mortgage Team is stepping up to continue K-97’s support of the Rock and Roll Society of Edmonton’s Centre for Arts and Music (CAM); aimed at mentoring a new generation of musicians, with a special focus on vulnerable youth in our community.

With a focus on youth at risk in our community, CAM reaches out to children who would otherwise have few opportunities to participate in the arts. Our goal is to reach them during critical after school hours through music. At CAM, children learn how to write songs, play instruments and perform together on stage. In the process, they earn self- esteem, respect for themselves and others, and much needed self-confidence.



“Highly recommend!! Their team was able to get me approved when other brokers failed to do so. Not only that but quickly as well! I know exactly where to go now if I ever require such services again in the future. Thanks again to Mike, Jodi & Julia. You guys rock!”

Trudi (Edmonton)