To be clear, I’m not Bank bashing. I know good people who work at Banks. My Mom use to work at ATB. So no hate. Just story telling here …
I’ve heard clients tell me, “I’m pre-approved” at my Bank a couple times now. And when I finish meeting with these same people, I’m left really wondering how some Bankers can send clients out home shopping at that point?
[Realtors, please take note]
What Does Pre-Approved Mean Anyway??
I choose to accomplish the majority of client file underwriting BEFORE submitting documents for review by the Mortgage lender. Yes, this is additional work. And sometimes documents go “stale” and updated docs are required in the future. Sometimes this is to the chagrin of busy people.
Really, what I’m doing is getting out in front of any imperfections in the clients file. I want to see everything the Mortgage lender is going to request to see, before they see it.
And guess what?
Sometimes client documents tell a different story than the story I hear from them. Different = better or worse.
When client documents show information that is less flattering, I work with my team to adjust the Mortgage file help achieve their goals.
I Think It Means Reviewing ALL Paperwork!
For example, there is a new RBC 60 second Mortgage approval advertisement campaign. I like the idea of an “instant approval”, however, the information I know about myself is sometimes different than the information I can use in my Mortgage application for qualifying.
Income is a PRIME example of this. You see, I might be making $10K a month since January. We’re in August now so it’s reasonable to think my annual gross income is $120K per year. That’s my income. That IS my income, but that’s not the income we can use in a Mortgage application.
Another example of reality vs. Mortgage reality is …I just had my Father, who lives in India, deposit $30K into my Bank account. I now have a down payment to purchase a home!! I do, but because of the source of those funds, they need to soak in a Canadian Bank account for 30 days.
There are more examples of this.
No Paperwork = Chance For Heartbreak
Sadly, first time home buyers don’t know what they don’t know. So they won’t even know the level of due diligence their Mortgage file is prepped to. All of the particular details surface once their purchase is live. At that point, the fun begins ;-).
Conclusion:
For those visiting my website, I hope you take away and understand the different levels of Mortgage pre-approval underwriting due diligence. Sometimes the information might not be what you want to hear? If that’s true, wouldn’t you like to hear it sooner than later?
Contact me today to clarify how much you can afford to purchase!
Talk soon,
Chad Moore
P.S
For the record, I am not perfect. Not every pre-approved client turns into a Mortgage lender approved file once their purchase is live. I do communicate, as best and strategically as I can, any trouble facing actual Mortgage approval to the clients BEFORE their file is live. I enjoy the challenge of this. I have been learning, and continue to remind myself, surprises in Real Estate do not end well. I do my best to uncover surprises as I find them.
