Lisa and Adam texted in a panic after receiving a call from their bank saying their mortgage ‘approval’ was no longer valid. The couple had spoken to their bank four months previous to get approved for their first home – a downtown Toronto condo. The representative at the bank asked them some questions about their income and employment and confirmed that they would qualify for a $445,000 purchase. The happy couple put in an offer and was accepted at $405,000, below the bank’s stated approved amount.
Three weeks before closing on their purchase they contacted the bank to check in. The representative wasn’t aware that the couple had an accepted offer closing and quickly scrambled to gather paystubs, job letters and income tax statements. When the rep reviewed the precise numbers he found that there was some income that could not be used because of government regulations. Additionally the condo fees were higher than expected and the couple no longer qualified for the $405,000 using the bank’s calculations. The couple was at risk of not closing on their home and faced a possible lawsuit, loosing their deposit along with hefty fees from the sellers.
After contacting me through a family member I had also helped earlier that year, I collected all the required documents, found a credit union that uses different calculations for qualifying and was able to quickly get them approved with a rate that was only $18/month higher than what their bank expected to offer them. Had we not been in such a rush the rate/payment may have even been lower.
What went wrong: Lisa and Adam went to their bank and got advice from an unlicensed bank representative who did not take the time up front to collect the proper documentation and confirm the couple’s actual income. The rep also did not think to tell the couple to be aware of how the condo fees would impact their qualifying rate. Finally, the rep did not keep in touch with the couple to monitor their home purchase journey and was unaware they had a legally binding offer.
By working with a licensed mortgage advisor such as myself, the couple could have avoided a considerable amount of stress and risk of loosing tens of thousands of dollars. When working with clients I request all documents up front and provide an accurate purchase range and advise you what to watch for when making offers. I guide you through every step of the process and am ready with a plan b in case something goes wrong.
I’m your advisor helping you find not only the best rate but also the best lender for your situation and goals. I work with you until you have your keys in-hand and for years to come.