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Mortgage Pre-Qualification vs. Pre-Approval—Simplified

I know these terms can be explained in many ways, making them confusing. Let’s simplify what actually matters when getting a mortgage.
 

It all starts with choosing an experienced mortgage professional (pick me, pick me!). From there, I’ll review the following based on current mortgage rules:
 

Application Details: Includes employment status, savings, and the source of your down payment.
Servicing Ratios: Assesses income versus home-related debt and total liabilities.
Credit Report: Ideally, you should have at least two active credit accounts, a two-year credit history, and a minimum credit limit of $2,500. A minimum rating of 680 is best.
Supporting Documents: Proof of down payment and employment verification.

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House For Sale Sign

How long does it take?

Pre-Approval can be very fast, if you have access to the documents required, 24-48 hours

When you actually make an offer to purchase and it is accepted, assuming we have required documents, we need 5-7 business days from the date I receive the offer and MLS.

 

When you offer is first submitted, realtors will often put 10 business days so there is time for the sellers to review your offer, request any changes, all sign, and then it is sent to your broker. 

STEP 1: Lender and Insurer Initial Approval (2-3 business days)

STEP 2: Lender checks all of the supporting documents (2-3 business days)

Step 3: Lender confirms complete, you are cleared to remove the financing condiiton.

An experienced mortgage broker understands lender and insurer guidelines thoroughly. If any aspect of your application requires an exception (meaning it falls outside standard rules) we can address it before submitting your information to a lender. These exceptions can range from minor details to factors that may otherwise delay approval.

Does Mortgage Pre-Qualification or Pre-Approval Guarantee Final Approval?

No, a pre-qualification or pre-approval does not guarantee final approval. These are initial assessments based on the information provided, but final approval depends on a full lender review, including:

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Lender Approval

Lending underwriters do not review applications unless there is a firm offer to purchase in place. While a pre-approval can give you a strong indication of what you may qualify for, final underwriting typically occurs only after you have an accepted offer on a property.

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Insurer Approval

Yes, if your down payment is less than 20%, default mortgage insurance is mandatory. In Canada, the three mortgage insurers are CMHC, Sagen, and Canada Guaranty.

Your application cannot proceed without their approval, and they will only review it once there is an accepted offer to purchase.

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Exception Approval

If an application requires an exception (as noted above), it cannot receive official approval until it is live—meaning there is an accepted offer to purchase in place. Lenders and insurers will only review and approve exceptions once the full application is submitted with a property attached.

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Property to Meet Guidelines

Approval is always pending the property meeting lender and insurer guidelines. The property must be:

  • Marketable and in reasonable condition

  • Up to code (e.g., electrical, structural soundness)

  • Eligible under lender/insurer policies (e.g., some may not accept age-restricted properties)
     

Final approval depends on both the borrower’s qualifications and the property meeting lender and insurer requirements.

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Lender Verification of Documents

Once the lender and insurer approve the application, the lender will review your documents to ensure they match the details provided in your application.

  • If everything is accurate, they will send confirmation of document approval.

  • If additional information is needed, they may request further documentation.
     

This is why it’s crucial to submit your documents to your broker as soon as possible for pre-checking—this helps prevent delays and ensures a smoother approval process.

This is a general guide only—lenders and insurers may impose additional conditions as needed. Each application is reviewed on a case-by-case basis, and requirements can vary based on the lender, insurer, and specific details of the application.

STEP 1: Pre-Approval 

What happens after I submit an mortgage application?

Within 24 hours, we’ll contact you to begin the process. To avoid delays, please ensure the application is fully completed. 

 

What if I don’t qualify for a mortgage right now?

Then we make a plan. Buying a home is likely the biggest financial decision you’ll make, and it’s completely normal to need some time to prepare. 

Is my application information secure?

Yes, all of your data is encrypted and securely stored on Canadian servers at TMG. 100% paperless office. TMG’s privacy policy [here]. Your privacy is extremely important to us.

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Will I receive a written pre-approval?

Yes! You’ll receive an email with a detailed package outlining everything you need to know at this stage, along with what to expect throughout the mortgage process. We ensure you stay informed every step of the way. 

Buying a House
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  Information can change without notice.

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