Understanding the Process Before You Begin.

Mortgage Pre-Approvals

A pre-approval gives you a working budget and shows sellers you have prepared. Lenders typically review income, employment, credit history and existing obligations, and will usually hold a rate for a limited period. A pre-approval is a review of your profile — it is not a final mortgage commitment, which depends on the property and full documentation.

• Recent pay statements and employment confirmation
• Two years of income history for self-employed applicants
• Statements for existing debts and down payment funds

First-Time Buyer Considerations

First-time buyers in Ontario may have access to programs that affect their down payment, taxes payable at closing or the funds they can draw on. Which ones apply depends on your situation, the property and current federal and provincial rules, so it is worth reviewing them early rather than at closing.

• Registered plan withdrawals toward a down payment
• Land transfer tax rebates available to eligible buyers
• Budgeting for closing costs beyond the purchase price

Refinancing Basics

Refinancing replaces or restructures your existing mortgage. The decision usually comes down to the complete cost picture — any prepayment charge, legal and appraisal costs, and the new terms — measured against what the change is meant to achieve. Running the numbers in full before deciding is always the better order.

• Understanding prepayment charges on your current term
• Comparing total cost, not only the interest rate
• Timing a refinance around your renewal date

Terms Worth Knowing

Mortgage documents use language that can obscure fairly simple ideas. Amortization is the full period over which the mortgage is repaid; the term is the length of your current agreement. Qualifying rules, default insurance thresholds and portability terms all shape what you can borrow and how freely you can move later.

• Amortization versus term
• Default insurance and down payment thresholds
• Portability, assumability and prepayment privileges