A quick review of the mortgage process

Your home is likely to be the largest purchase you will ever make

It is always nice to know what to expect before you head into a new situation and applying for a mortgage is no exception. This week we are going to take a quick look at what to expect and what you should bring to make the process silky smooth.

Choose your professional.

Your home is likely to be the largest purchase you will ever make. It stands to follow that you want to make sure the person helping you is the most qualified. Referrals from your realtor, home builder, or other professional is a great place to start. Consider asking your friends and family too. Here are a few things to consider:

• Are they able to explain clearly all aspects of the mortgage? As I have said time and again, there is way more to a mortgage than rate.

• Do they get back to you in a timely manner?

• Are they friendly and professional?

• Do they have a well-written article in the Red Deer Express? (Just kidding).

Gather your paperwork.

You are going to have to provide all of the documentation at some point so you may as well do so ahead of time. This will allow your mortgage professional to offer you a solid pre-approval and help you mitigate any problems. Here are the documents you will need.

1. Letter(s) of employment.

2. Recent paystub(s).

3. Two most recent years’ Notice of Assessments from the CRA.

4. A 90-day history of any and all accounts you are using to make up the down payment.

5. A void cheque.

6. Government issued ID.

If you are self-employed you will also need:

1. Two year’s T1 Generals.

2. Two year’s financial statements.

Specialty documentation you may need depending on your situation:

1. Divorce/separation agreement.

2. Bankruptcy discharge documents.

3. Proof of debts/collections paid.

4. Proof of taxes paid.

5. Mortgage statement and offer to purchase on your current home.

6. Lease agreements, mortgage statements, property tax bills on any rentals.

It should be noted that your lender will ask for all of the above and likely more. If you were lending someone $300,000-plus you would want to make sure all t’s were crossed, too.

Apply – its finally time to do the application. You are going to be asked a series of questions and your credit is going to be pulled. Here are the credit criteria the lenders are using.

• Two trade lines reporting for two years – A trade line can be a credit card, a line of credit, a vehicle loan but ideally you should have one credit card and the other can be any of the others.

• No late payments.

• You are not exceeding 75% of your available credit limit.

• Normal levels of credit inquiries.

I will tell you that credit cards and mortgages now report on your credit bureau so make sure they are both paid on time every month.

Learn the Basic terms. Information is abundant these days so it truly is easier than ever to familiarize yourself with mortgage lingo.

You are signing a binding contract for a time frame of one to 10 years so taking an hour up front to understand the terms is a good idea. I promise that your mortgage professional likes it when you ask questions so feel free to ask away.

And there you have it. What to expect from the mortgage process. It’s not that scary at all really now is it?

Have a great week folks!

Pam Pikkert is a mortgage broker with Dominion Lending Centres – Regional Mortgage Group in Red Deer.

Just Posted

The Red Deer Home Renovation & Design Show runs through to Sunday at Westerner Park

Lots of ideas for fall renovation, decor, design, organization, construction and indoor living projects

Red Deer RCMP investigate second failed ATM theft attempt

This is the second attempt to steal the ATM from Eastview IGA in less than a week

Get your scare on at the annual Zed Haunted House

The haunted house opens tonight at 6833 66th St.

Singer k.d. lang receives Alberta’s highest honour

Celebrated singer-songwriter k.d. lang received the Alberta Order of Excellence in Edmonton

Pot sales down by nearly 70% on Day 2 of legalization in B.C.

Several products on BC Cannabis Store are still sold out

Colourfully named cannabis products appeal to youth, Tory health critic says

Conservative health critic Marilyn Gladu says the Liberal government needs to do more to ensure cannabis products available online are not enticing to young people

B.C. high school teacher faces sexual assault charges

A Mt. Boucherie teacher has been charged with child luring, sexual exploitation and sexual assault.

Fashion Fridays: You can never have enough shoes

Kim XO, lets you know the best online shopping tips during Fashion Fridays on the Black Press Media Network

Migrants, police mass in town on Guatemala-Mexico border

Many of the more than 2,000 Hondurans in a migrant caravan trying to wend its way to the United States left spontaneously with little more than the clothes on their backs and what they could quickly throw into backpacks.

Trump: ‘Severe’ consequences if Saudis murdered Khashoggi

Pro-government newspaper Yeni Safak on Wednesday said it had obtained audio recordings of the alleged killing of Saudi writer Jamal Khashoggi inside the Saudi Arabia’s consulate in Istanbul on Oct. 2.

Feds dead set against ‘ridiculous’ quotas to replace steel, aluminum tariffs

Donald Trump imposed the so-called Section 232 tariffs — 25 per cent on steel and 10 per cent on aluminum — back in June on national security grounds.

Campus brawl leads to charge against B.C. football player

Takudzwa Timothy Brandon Gandire, a 21-year-old defensive back from Vancouver, is charged with assault causing bodily harm.

Most Read