Alex Lavender - Mortgage Broker

How long does a mortgage pre-approval last?

bankruptcy mortgage

It is important to know the difference between an approval and a pre-approval for a mortgage. A pre-approval is based on estimates using theoretical figures for a property. An approval is for a specific property once an offer is made and is backed up with documentation to prove the information in the application.

I am a firm believer that everyone should get a mortgage pre-approval. Without it, you just don’t know. It’s a great idea to get pre-approved sooner rather than later. If you are thinking about getting pre-approved, just do yourself a favour and set up a quick call or appointment with a mortgage broker.

It takes less than an hour to complete.

Nothing is worse than getting ready to buy a home only to find out that there are issues that are now going to take a year or two to resolve. A common problem I’ve encountered is that clients do not have enough established credit, which can take up to two years to build with a trade line.

With that being said, be honest with your broker and tell them any nuances or irregularities with your situation. Unlike a mortgage specialist at the bank, a broker is here to work on your behalf and with your best interests in mind—not the lender’s. They will help ensure that everything is in order so that you can get approved.

How long does a mortgage pre-approval last?

A pre-approval is also a great tool if you are looking to purchase a home in the next 120 days. This is because your broker can obtain a rate hold through a lender. A rate hold will lock in a rate today, so if the rates go up in the market, you’re still entitled to that lower rate as long as the closing date is within that 120-day window.

If rates go down, then you can just disregard the rate hold and obtain the new lower rate. It’s essentially free insurance for the taking and it comes at no cost to you. Just make sure that your broker is aware that you would like one so they can obtain it for you.

Common pre-approval issues

I’ve encountered is that clients do not have enough established credit, which can take up to two years to build with a trade line.

With that being said, be honest with your broker and tell them any nuances or irregularities with your situation. Unlike a mortgage specialist at the bank, a broker is here to work on your behalf and with your best interests in mind—not the lender’s. They will help ensure that everything is in order so that you can get approved.

Alex Lavender

Alex Lavender

Alex Lavender is a mortgage broker based out of Halifax, Nova Scotia. He is the author of the book "Mortgages for Millennials" which is used by Canadians to understand how mortgages work. Alex was born raised in a small town in Ontario, and now finds pride in helping everyday Canadians get a mortgage for their first home.