Get Pre-Approved First: The Smartest Move You Can Make Before Buying a Home

Falling in love with a house before you know what you can afford is one of the most common and most painful mistakes in real estate. The fix is simple: get pre-approved for a mortgage before you start looking.

What Is Mortgage Pre-Approval?

A pre-approval is a lender's written estimate of how much they are willing to lend you, based on a review of your income, debts, credit history and down payment. It usually comes with an interest rate that is held for a set period, often 90 to 120 days, so a rate increase will not catch you off guard while you shop.

Why Do It Before You Buy?

• You know your real budget. You shop in a price range you can actually get financed, instead of guessing.
• You protect your rate. If rates rise while you search, your held rate may save you real money over the life of the mortgage.
• You are a stronger buyer. Sellers and agents take offers more seriously when financing is already lined up.
• You move faster. When the right home appears, you can make an offer with confidence rather than scrambling for paperwork.
• You catch problems early. A credit error or a debt that is too high is much easier to fix before you are under contract.

What You Will Need to Apply

• Government-issued photo ID
• Proof of income: recent pay stubs, a letter of employment, or two years of tax documents if you are self-employed
• Bank statements showing your down payment and savings
• Details of your debts, such as car loans, credit cards and student loans
• Permission for the lender to check your credit report

How to Choose the Right Lender

Not every lender is the same, and the best one for your neighbour may not be the best one for you. When comparing, look at:

1. Interest rates and rate hold period. Ask how long the rate is guaranteed.
2. Prepayment options. How much extra can you pay each year without a penalty?
3. Penalties for breaking your mortgage. Life changes, and a heavy penalty can be costly.
4. Flexibility. Can you skip a payment, change frequency, or port your mortgage to a new home?
5. Service. A responsive advisor who explains things clearly is worth a lot during a stressful process.

Compare at least two or three lenders, and consider speaking with a mortgage broker who can shop several lenders for you.

Why ATB Is One of the Best Places to Start

ATB Financial is headquartered in Alberta and has built its reputation on serving Albertans. For many buyers in the province, it is a strong first stop, for reasons like these:

• Local knowledge. ATB understands the Alberta market, including how income in industries like energy, agriculture and small business can look different on paper.
• A range of mortgage options. Fixed and variable rates, with terms to suit different budgets and comfort levels.
• Flexible features. Ask about prepayment privileges, payment options and portability so you know what is included.
• Personal service. ATB has branches and advisors across Alberta, so you can sit down and talk through your situation.

As with any lender, rates and terms change often, so confirm current details directly with ATB and compare them against other lenders and a broker before deciding.

Your Next Steps

1. Check your credit report and fix any errors.
2. Gather your income, tax and savings documents.
3. Get pre-approved with two or three lenders, ATB included.
4. Set a firm budget that leaves room for closing costs and moving.
5. Start house hunting with your pre-approval in hand.