# Mortgage Pre-Approval Question(s)



## ludetuner (Dec 28, 2016)

I have applied for a pre-approval for a mortgage through a TD mortgage broker. My mortgage broker is based in AB (where I am) and is strongly suggesting that if I put an offer on a property, I put a condition on financing (even though she is confident my affordability is over $200k more than the cost of potential properties i am looking for. 

I am looking for a condo in Toronto and I don’t believe putting condition on financing will help my cause in a hot market. The other issue is I am hearing that Toronto mortgage brokers are typically able to satisfy the mortgage approval confirmation pretty quickly (my broker says it could take 5-7 business days)

My question to the experts is:

1. Are some mortgage brokers faster than others at confirming mortgage so I can waive conditions?
2. Will i take a hit to my credit if I go through another broker (I have already sent in a per-approval application with the first broker)

Thanks


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## sags (May 15, 2010)

A TD mortgage rep told me that all she does is input the applications into the computer and send them off to head office in Toronto.

The mortgages are analysed by software and categorized into 3 categories........approved, declined or sent for further consideration.

She said she has no idea if the mortgages will be approved because she has seen some approved or declined for no reasons she could decipher.

Perhaps the bank has too many mortgaged properties in the immediate area, and want to reduce their risk. Perhaps the mortgage application is for more money than the area usually gets.

In any event, your affordability is one factor, but another important factor is the value of the property.

Personally, I have never signed a sales contract to purchase a home that didn't include a "subject to financing" clause, because I want the protection.

I also don't think Toronto is such a "hot market" for condos right now. Sales of homes all over have slowed significantly, listings have risen and prices are falling.


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## AltaRed (Jun 8, 2009)

For once, I have something to agree with Sags on! Always subject to financing. I would also have used a mortgage broker to have a few lenders lined up.


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## Just a Guy (Mar 27, 2012)

The rules can always change, so subject to financing is not a bad idea unless you can finance the place yourself should funding fall through. It a very common clause. 

Also the Toronto market has cooled significantly lately, so you don’t need to worry much about that. I’d be more concerned over your price. It’s pretty low for Toronto. 

As for credit hits, if your credit is so bad that this is a concern, you’ve got bigger issues. The hit is relatively minor. 

Yes brokers vary on their times, but you can always ask for extensions on clauses, this is also very common as banks are often slow. Nothing to worry about most sellers want the sale to go through.


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## OhGreatGuru (May 24, 2009)

Always put a condition on. When you sign a letter of offer it is a legal contract. If anything happens and you can't get the financing you are out on a legal limb. If things go sour and you complain to your lawyer afterwards he/she will tell you "Too bad! So sad! You should never have signed this without conditions. You will be lucky if you get away with just losing your deposit. The agents could go after you for their full fees; the owners could theoretically go after you for the full purchase price, but given the hot market (and your inability to borrow the money anyway) they might settle for the cost of the inconvenience and loss of opportunity to sell to other interested buyers.")


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## ludetuner (Dec 28, 2016)

Just a Guy said:


> The rules can always change, so subject to financing is not a bad idea unless you can finance the place yourself should funding fall through. It a very common clause.
> 
> Also the Toronto market has cooled significantly lately, so you don’t need to worry much about that. I’d be more concerned over your price. It’s pretty low for Toronto.
> 
> ...


Thanks for the feedback but I didn't mention my price range in the quote

Expect to pay around 600k to 650k for a 2bd/2bath in and around the downtown core


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## ludetuner (Dec 28, 2016)

sags said:


> A TD mortgage rep told me that all she does is input the applications into the computer and send them off to head office in Toronto.
> 
> The mortgages are analysed by software and categorized into 3 categories........approved, declined or sent for further consideration.
> 
> ...


Thanks for the feedback and yes, I too have never bought a place without a financing condition in place.


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## ludetuner (Dec 28, 2016)

AltaRed said:


> For once, I have something to agree with Sags on! Always subject to financing. I would also have used a mortgage broker to have a few lenders lined up.


I have used mortgage brokers in the past and quite frankly, isn't much of a difference to what the bank mortgage special is. Also, i typically shop rates online and use that as leverage. With the various online mortgage rate finders/comparisons, have you still found it more beneficial to go through a broker?


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## AltaRed (Jun 8, 2009)

ludetuner said:


> I have used mortgage brokers in the past and quite frankly, isn't much of a difference to what the bank mortgage special is. Also, i typically shop rates online and use that as leverage. With the various online mortgage rate finders/comparisons, have you still found it more beneficial to go through a broker?


Not myself (last mortgage paid off in 1990) but last year, my step son and wife used a mortgage broker and I was pretty impressed with the offerings she came up with. No reference point for me to compare with. They did end up with a TD mortgage.


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## marina628 (Dec 14, 2010)

I do not think I would say the condo market in GTA is hot ,do your offer with financing condition .There is a nice mortgage broker on this forum who has answered questions on behalf of my son for me ,I have seen 5 year fixed offered as low as 2.96 -3.29% on various forums.


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## ludetuner (Dec 28, 2016)

Thanks for the advice/recommendations. I’ve spoken to a couple of mortgage specialists and they’ve all said to have a financing condition, not because of my borrowing ability; but because of how the bank may appraise the property.


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