Shop for your home with a real budget.

A pre-approval is a lender's conditional assessment of how much you may borrow, based on the documents you provide. It usually comes with a rate hold, so if rates rise while you search you keep the held rate.

It is not a final approval. Once you have an accepted offer, the lender still reviews the property itself, confirms your income and down payment again, and may order an appraisal. A change in your job, debts or credit before closing can affect the result.

Lenders look at two ratios. Your housing costs (mortgage payment, property and school taxes, heating and half of condo fees) should stay around 39% of gross income, and all debts together around 44%.

Every borrower is also tested at a higher qualifying rate: the greater of your contract rate plus 2% or 5.25%. That is why your approved budget is often lower than what an online calculator suggests. You can try it yourself in our affordability calculator.

• Pre-approval and rate hold
• House hunting with your realtor, offer accepted with a financing condition
• Full lender submission with the promise to purchase
• Appraisal and underwriting, then a written commitment with conditions
• Conditions satisfied, documents signed at the notary, funds released

In Quebec, your financing condition in the promise to purchase is usually 10 days or more. Getting pre-approved first makes that window far less stressful.