A prequalification is an estimate from what you say; a preapproval is a lender’s decision on verified documents, with a rate held 90 to 120 days. Which one to get before visiting.
Two options are only comparable on the same amount, term and amortization. Change one of them and the cheaper option can flip. Most misleading comparisons start there.
What each one gives up
One option tends to be cheaper and stiffer, the other looser and dearer. Which wins depends on how likely you are to move, prepay or break the term before it’s up.
Use full numbers to decide
Come back to what you’d actually pay: monthly payment, fees, exit penalty, and the conditions that outlive the signing. Looking at the rate alone tells you very little.
Documents to gather
What the lender will ask for.
What the file is for
Income and documentation
Debts, credit
Property or security
Target dates
Lender options
Frequently asked
Which documents should I gather?+
Your last two notices of assessment, recent pay stubs, an employment letter, three months of bank statements and proof of your down payment. Ready before the offer, they make a five-day financing condition workable. Chased after, they add weeks.
Current rates
Today’s rates, with the fine print.
These rates are indicative. Yours depends on your file, the type of mortgage (insured or not) and the lender. And look at the penalty too, it matters as much as the number.
Buying, renewing, refinancing, or something a bit out of the ordinary: tell us where you’re at, even if it’s still fuzzy. Mathieu gets back to you with next steps and the documents to pull together.
