At some point in their lives, everyone strives to buy a home.
This is especially true for newcomers to Canada, who often come to this country for added stability and comfort in their present-day lives and their future.
Buying a home is a big part of that journey, but there are several things that newcomers must understand before they can apply for their first mortgage in Canada. What follows will answer five of the most important questions related to getting approved for a mortgage in Canada.
What is a mortgage?
A mortgage is a loan agreement provided by a lender, used by the recipient to purchase a home, piece of land or other type of real estate. Mortgages give the lender the right to repossess (take back) the loan recipient’s property if they fail to repay the money borrowed (plus interest).
What is a mortgage pre-approval and how does it work?
A mortgage pre-approval, otherwise known as a mortgage pre-authorization or pre-qualification, is an assessment of a potential homebuyer's borrowing capacity and the interest rate the lender is likely to charge. Mortgage pre-approvals help Canadians understand their potential borrowing capacity and interest rate affordability.