So you’ve found a great builder, a nice community and the perfect home plans… what’s next?
When building a new home, the process is very similar to the pre-approval you’ve already completed but with some additional documentation required to “meet conditions” to secure the mortgage.
If you haven’t already done so, before you write that deposit cheque you’ll want to be pre-approved for a mortgage. You don’t want to place your deposit and then try and find a mortgage because if you can’t get the financing you need, you forfeit your deposit and the builder sells your home to somebody else.
EMPLOYMENT INCOME IS A QUALIFYER
Another consideration is a change of job. Employment income is one of the qualifying criteria used in a lenders calculations. If you are looking to change your job, or going from a salaried employee to a contractor or self employed, there may be some implications that impact your qualifying numbers. Give us a call and we’ll let you know if or how you may be affected.
Finding that perfect home is very exciting and can be your dream come true however a lot can change in 6-9 months. Make sure if you are thinking of making changes that you call us to make sure it will not affect your existing approval.
YOU’LL NEED ADDITIONAL DOCUMENTATION
The additional documentation we’ll require to secure the mortgage is :
- The purchase contract
- Floor plans, spec sheet and new home warranty information (all available through the builder)
- A copy of the deposit cheque
Once your application and the property has been reviewed the lender will provide a mortgage commitment, which we will review with you.
As your new home construction may take up to a year the rate being offered today may not necessarily be the rate you receive. We may be able to secure a rate for up to one year and it is part of our commitment to you that we will watch the rate to ensure you receive the lowest rate before you take possession.
The mortgage commitment is based on your approval numbers at the time of your application. It is important to not accumulate more credit from the date of your approval. Making major purchases that substantially increase your debt can also affect your approval, as it is calculated again closer to possession date. It is best to wait until after moving in to make any other major purchases – talk to us if you’ve got something in the plans that seem unrelated to your home or mortgage.