How can you plan for retirement? In this blog post, we discuss 5 tips to help you get financially ready for this big milestone.
If you’re in the market for a home, and you have decided to use a mortgage broker’s services, it likely won’t be long before you’re prepping for your first appointment with a broker. You may be feeling a bit overwhelmed, knowing they may be the one to help you secure the right mortgage product. However, you don’t need to stress! Brokers know just what to do to help you feel at home during your first appointment. Here’s how you can prepare!
Know what to expect
First, be sure you understand what happens during your first appointment with a broker. You will meet your broker a few times throughout your mortgage experience. During this first meeting, for the most part, your broker will simply want to get to know you. They will chat with you about your mortgage or homeownership goals, your debt and income, and how the mortgage process actually works. They will also tell you what documents they will need from you to get started, and what your options will be as a borrower. More than anything, this is a chance to ask questions and see if you can form a good working relationship together.
Have a budget in mind
You might not know exactly how much you can afford when buying a home, and in fact, that could be one of the biggest reasons you’re approaching a broker. However, it’s handy if you can have a general, broad idea of your budget for your first appointment with a broker. You can do a preliminary examination of your finances to see what kind of price range you may be looking at, and whether it will be a townhome, condo, detached house, etc. You can even find a listing you think closely matches your situation to show to a broker. A broker is definitely going to help you find the right budget, so you don’t need to have it all figured out ahead of time, but any information you can bring to the appointment will help kick start the conversation.
Come prepared with debt information
Lots of current and future homeowners have debt, so don’t be ashamed or think you can’t buy a home if you hold some debt too. However, you should make sure you tell a broker about any debts you have, because it can affect your mortgage approval. Why does this information matter? Part of getting a mortgage involves a lender examining your debt service ratios, which includes comparing how much of your income goes towards paying off debt. The higher your ratio, the trickier it can be to get mortgage financing. So, if you have debts, bring this information to a broker and they can help you calculate these ratios. If you need to lower your debts before applying for a mortgage, they can help you begin that process. This includes anything from student or car loans to credit cards, lines of credit, or other types of debt.
Bring income documents
Eventually, you will need to prove to a lender you have the income to support a mortgage. You will bring your proof of income documents to your appointment with a broker. Brokers will examine your income and financial history to determine what they think you can likely afford, which is an important step before you can move forward with the home buying process. If you have a traditional job, you will need to provide T4s and bank statements. If you’re self-employed, proving income is harder, so bring any tax returns or other proof of income documents you have. Brokers will tell you what additional information they will need, and how mortgage options may differ for self-employed borrowers.
Think about property examples
You don’t need to know the exact house you want to buy, but it’s useful if you can come to your appointment with a broker with some property examples. Similar to coming to a hair appointment with an image of the cut you want, it never hurts to show a broker listings you’re interested in so they know where your mind is. Of course, brokers aren’t agents, and they aren’t the ones who find properties for you, but they do have a good idea of price ranges and can tell you what prices and areas you’ll be looking at with the properties you like. Plus, they will have information about how the process works with different property types. For example, getting financing for a small city condo may be different than for a detached house in the country.
Be ready with questions
A broker will certainly ask you questions, but it’s also your time to ask them questions to make sure they’re a good fit for you. Your first meeting should be an equal back and forth with you getting to know each other. You should ask about the broker themselves, as well as the mortgage process. We recommend asking about fixed and variable rates, current interest rates, how long the process takes, what information they need from you, how competitive the market is, what you need to do next, etc. You should also ask them about their experience in the industry and how they will provide the best help for you.
Preparing for your very first appointment with a broker might make you feel a bit nervous, but you don’t need to be! Brokers are professional and unbiased, and they truly work with your best interests in mind. We make sure we are available and approachable for all your mortgage needs. Let a broker guide you towards your homeownership goals and help you achieve your dreams in this market.
If you want to discuss your mortgage with a broker, give us a call at Centum Home Lenders! You can reach us at 506-854-6847, or get in touch with us here.