The Myplace Playbook // 068
Hey Everyone,
We've talked about rates, credit, down payments, job security, declined applications, couples who can't agree.
And if you've been reading along, there's a chance something landed with you somewhere in the last few weeks.
Maybe one of those issues was about you. Maybe you recognized yourself in a reply. Maybe you've just been doing the math and the math is starting to work.
Either way, if you're at the point where the question has changed from "should I?" to "okay, how?", this one's for you.
The first thing I want to address.
A lot of people don't reach out because they don't feel ready enough to reach out.
They think they need to have everything figured out first. The down payment finalized. The credit perfect. The income situation clean and simple. They don't want to show up to a conversation half-prepared and waste someone's time.
I want to put that one to rest right now.
There is no such thing as too early to have this conversation. The whole point of talking to a broker before you're ready is so that when you are ready, there are no surprises. I would rather talk to you today, with a messy file and six months of work ahead of us, than have you show up the week you find a place you love with something fixable we didn't know about.
You are not wasting my time. Figuring out where you stand is the job. That's what the first conversation is for.
So what does the first step actually look like?
It's a conversation. That's it.
Not a form. Not a commitment. Not a credit check yet. Just a conversation where I ask you a few straightforward questions and you tell me where you're at.
What do you earn. What do you have saved. What debt are you carrying. What kind of place are you looking for and roughly where. How soon are you thinking.
That's the whole thing. Most of the time it takes twenty minutes. At the end of it you'll know more about your mortgage situation than most people know after years of thinking about it.
From there, if it makes sense to move forward, we go into a pre-approval. That's where the documentation comes in.
What a pre-approval actually involves.
This is the part that sounds more intimidating than it is.
You'll need to pull together a few things. Most people have all of it already, it's just a matter of finding it.
Proof of income. For salaried employees that's typically your two most recent pay stubs and your last two years of T4s. For self-employed borrowers it's your last two years of Notices of Assessment and potentially your business financials. If your situation is anything other than straightforward salaried, we'll talk through exactly what applies to you.
Proof of down payment. Three months of bank statements showing the funds. If any of it is a gift, a signed gift letter from the donor. If it's coming from your RRSP or FHSA, a recent statement showing the balance.
ID. Two pieces. Government issued. Nothing exotic about this one.
A credit check. This is the one people sometimes worry about. A mortgage application triggers a soft inquiry, which may move your score by a few points temporarily. It is not something to lose sleep over. And if your credit situation has question marks around it, we talk about that before we pull anything.
That's the list. It's not nothing, but it's also not the mountain people imagine it to be.
What happens after a pre-approval.
You get a number. A real one. The maximum you qualify for and what the payment looks like at that number.
You also get a rate hold, typically 90 to 120 days depending on the lender, which means if rates move while you're shopping, you're protected.
From there, you go shopping with a clear budget and a broker in your corner who already knows your file. When you find something, the financing piece moves quickly because the work is already done.
That's the whole process from "I think I'm ready" to "I have a number and I'm shopping."
It does not take long. It is not complicated. The hardest part for most people is just making the first move.
Here's what I'd suggest.
Hit reply. Tell me you're ready to figure out where you stand.
You don't need a polished summary of your finances. You don't need to have answers to every question. Just tell me you want to have the conversation and we'll take it from there.
The first step is smaller than you think.
-Andrew
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