Top 10 Documents You Need for Mortgage Pre-Approval in Calgary

What is the Mortgage Pre-Approval Process in Calgary?

Applying for a mortgage pre-approval process in Calgary is a smart first step where the lenders look at your finances to find out the maximum amount they may lend you and at what interest rate. They ask for your personal information and various documents and run a credit check.

This process shows sellers you are serious and financially ready. However, to get pre-approved you will need to provide mortgage pre-approval documents to the lender in Canada.

What Documents are needed for Mortgage pre-approval?

For a mortgage pre-approval in Calgary, the borrower needs to provide some important documents for verification to the lenders. It is important to work with a professional mortgage specialist to help you provide details of the documents required to be submitted.

• Government-issued photo ID: The lender verifies the identity and confirms that the borrower is legally allowed to borrow money in Calgary. The acceptable forms are passport, driver’s license and permanent resident card (if applicable). It is important to ensure the ID is valid and unexpired with your current name and correct spelling.
• Income Proof: Your income level determines how much you can borrow and your ability to repay the loan. The borrowers need to submit the most recent pay stubs, employment verification letter, job title, employment status and length of employment. Lenders want to see stable and consistent income especially if you are applying as a salaried employee.
• Notice of Assessment: One of the mortgage pre-approval documents in Calgary is the Notice of Assessment of the NOA. Lenders use your NOA to confirm your declared income and check for outstanding debts with the Canada Revenue Agency. The borrowers need to provide at least the last two years of NOAs. If they owe taxes, pay them before applying. This is especially important for self-employed applicants or those with variable income.
• T4 or T4A Slips: T4 slips summarize your yearly employment income, while T4A forms are used for contract commission or self-employment income. It is to be produced by the salaried employees and freelancers or consultants. You have to submit slips for at least the past two years for a more comprehensive financial overview.
• Bank Statements: To verify your savings, spending habits and whether you have sufficient funds for a down payment and closing costs, the borrowers need to submit bank statements to the lenders. They have to provide three to six months of statements and include accounts related to savings or investment accounts. The bank statements should reflect steady income deposits and responsible spending.
• Proof of Down Payment: Lenders must confirm where the down payment is coming from and it is not borrowed unless from approved programs like RRSP Home Buyer’s plan. The most acceptable sources are personal savings, RRSP withdrawal, gifted funds and the sale of previous property. This helps the lenders meet the anti-money laundering norms of Canada. Work with a reputed and expert Mortgage Broker in Calgary to understand the required documents that need to be submitted during the mortgage pre-approval process.
• Credit Report and Credit Score: The credit score significantly impacts your mortgage pre-approval process. It reflects your reliability in managing the debt. One of the Alberta home loan pre-approval requirements is lenders will verify your credit score themselves. But you can request a copy from Equifax or TransUnion for personal review. A credit score of 680 and above is preferred by most lenders for favourable rates.
• Letter of Employment: This is required in the mortgage pre-approval process to confirm your job stability and salary and that you are currently employed. The details include the employer’s name and contact, job title and start date, annual salary or hourly wage and employment status. It must be signed and printed on the company’s official letterhead.
• List of Current Debts and Obligations: One of the important pre-approval mortgage requirements in Calgary is the list of current debts and obligations. The lenders assess the debt-to-income ratio to determine if one can afford to take on a mortgage. The list includes car loans or leases, student loans, personal loans or lines of credit, and spousal or child support obligations. This helps calculate the borrower’s total debt service ratio, an important approval factor.
• Additional documents for self-employed individuals: If you are self-employed, lenders require more detailed documentation to confirm your income. You will have to submit a business license or registration, two to three years of financial statements, two to three years of personal and business tax returns, GST and HST returns and contracts or invoices from clients. With these documents, the lenders ensure your business is stable and capable of generating steady income.

How the right mortgage specialist will help in the mortgage pre-approval process in Calgary?

The Professional Mortgage Advisors in Calgary –

• Evaluate your financial health and advise how much you can borrow.
• They help you gather and organize the necessary documents
• They will help you connect with the lenders offering the best rates and terms
• Explain the mortgage options aligned with your goals and income
• Review your credit report and suggest ways to improve your score.
• Ensure accurate application submission to avoid delays
• Streamlines communication between you and the lenders

Mortgage pre-approval is a significant step giving the borrowers clarity on what they can afford. It also strengthens your negotiation power when making an offer. With these 10 essential documents, you can make your pre-approval process smoother and faster. A good mortgage broker in Calgary will guide you through every step.

FAQs

1. What is the paperwork for the mortgage pre-approval process in Calgary?
The paperwork for mortgage pre-approval in Calgary includes ID, income proof, tax documents, credit report, bank statements and down payment verification. Manpriit Pabla provides support and guidance through every step of the process.

2. What mortgage documents does a first-time buyer need to submit in Calgary?
A first-time home buyer in Calgary needed to submit the following documents for mortgage pre-approval government-issued ID photo, recent pay stubs and letter of employment, T4 slips, notices of assessments from the past two years, bank statements, credit score, gift letter, business financial statements and tax returns (for self-employed individuals) and proof of additional assets or investments.

3. Why is mortgage pre-approval important for first-time home buyers?
Mortgage pre-approval is important for first-time home buyers in Calgary as it clarifies their budget, strengthens offers and speeds up the buying process. Manpriit Pabla helps first-time buyers navigate this process effectively.

Back to Main Blog Page

Mortgage Blog

Your Calgary and Alberta Mortgage Expert