Get Pre-Approved for a Mortgage in Ontario

Buying your first home is exciting — and sometimes, a little overwhelming.
One of the best ways to make the process easier (and less stressful) is to get pre-approved for your mortgage before you start shopping.

What most people call a pre-approval is actually a pre-qualification — a detailed review by your mortgage broker that tells you exactly what you can afford, how much you’ll need for your down payment, and what your monthly payments will look like. It turns guesswork into confidence — and helps you focus on homes that truly fit your budget.

What Is a Mortgage Pre-Approval

The terms pre-qualification and pre-approval are often used as if they mean the same thing — but they’re actually quite different.

A pre-qualification is the first and most important step, and it’s done by your mortgage broker.
During this step, your broker reviews your income, debts, credit, and goals, and — based on their knowledge of lender guidelines — calculates how much you would qualify for and what your payments would be.

This step gives you accurate, personalized numbers so you know your true budget and what price range to shop in.
It doesn’t require an accepted offer or a property yet, and no lender needs to review your file at this stage.
The mortgage broker uses real lender rules and qualifying formulas to give you the same results the lenders would later confirm.

A pre-approval, on the other hand, is when your full application has been reviewed and conditionally accepted by a specific lender.
In most cases, lenders do not review or issue a formal pre-approval until there is an accepted offer to purchase and a property address.
Until then, it’s your broker who prepares and qualifies your file accurately using those same lender standards.

Once you’ve been pre-qualified and are ready to make an offer, your broker submits the full package to the lender for final approval.

When you’re pre-qualified, you will know:

• The maximum home price you can afford
• The mortgage amount available to you
• The rate hold you can secure for up to 120 days
• What your monthly payments will be

This gives you everything you need to confidently search for a home within your budget — knowing your numbers are based on real lender criteria, not guesses or online calculators.

Why Getting Pre-Approved First Matters

A pre-qualification (often called “pre-approval”) helps you move forward with confidence.

• You know your price range. You’ll only look at homes you can actually afford.
• You protect your rate. If rates rise while you’re searching, your rate stays locked in for up to 120 days.
• You’re taken seriously. Realtors and sellers prefer working with buyers who already have financing arranged.
• You avoid surprises. You’ll know what your payments and costs will be long before you make an offer.

Without this step, it’s easy to waste time on homes outside your budget or miss out on one you could have bought.

Minimum Down Payment in Canada

Your down payment is the money you put toward the purchase price of your home. The rest comes from your mortgage.

How much you need depends on the price of the home:

• For homes up to $500,000, the minimum down payment is 5%.
  Example: A $400,000 home would need a $20,000 down payment.
• For homes between $500,000 and $1,499,999, the minimum is 5% on the first $500,000 and 10% on the rest.
  Example: A $750,000 home would need $25,000 on the first $500,000 and $25,000 on the remaining $250,000 — a total of $50,000.
• For homes priced at $1.5 million or more, you must have at least 20% down.
  Example: A $1,500,000 home would require a $300,000 down payment.

Homes priced under $1.5 million can qualify for an insured mortgage, which allows you to put less than 20% down.
Homes $1.5 million or above cannot be insured, so you must have at least 20% down.

Insured vs. Conventional Mortgages

An insured mortgage applies when you put less than 20% down and the purchase price is under $1.5 million.

In this case, the lender is required to add default insurance.
“Default” simply means missing your mortgage payments. The insurance protects the lender (not you) if the borrower ever defaults.
It allows you to buy a home with a smaller down payment, and the insurance cost is added to your mortgage balance.

A conventional mortgage applies when you put 20% down or more.
These don’t need insurance and usually offer a bit more flexibility — for example, you can choose a longer repayment period (amortization).

Understanding Amortization

Amortization is the total number of years your mortgage is set up to be paid off — if you made the same payments for the entire time and never changed your setup.

It’s different from your term, which is usually 5 years.
The term is how long your rate and contract last before you renew or renegotiate.
The amortization is the bigger picture — the full timeline that determines how your payments are spread out.

Here’s how it usually works in Canada:

• Insured mortgages (less than 20% down) can go up to 25 years.
• Conventional mortgages (20% down or more) can go up to 30 years with most banks and major lenders.
• Subprime or alternative lenders may allow even longer amortizations, though these usually come with higher interest rates.

As of 2024, there’s an important update:
First-time homebuyers and anyone buying a newly built home can now qualify for an insured mortgage with a 30-year amortization.

This change helps make monthly payments more manageable and improves affordability for those entering the market.

Understanding the Mortgage Stress Test

When you apply for a mortgage, lenders must check that you could still afford your payments if rates were higher in the future.
This is called the mortgage stress test.

Even if your actual rate will be, for example, 5%, the lender has to test your affordability using a higher rate — either your rate plus 2%, or the federal “benchmark rate” (whichever is higher).

You don’t pay that higher rate — it’s simply used to make sure your income and budget could handle an increase later on.

What Lenders Look At

Lenders review your full financial picture before approving a mortgage. They look at:

1. Income – How much you earn and how steady your income is.
2. Credit – Your credit score, payment history, and how you manage debt.
3. Debts – Monthly payments on credit cards, loans, or other obligations.
4. Down payment – How much you’ve saved and where it comes from.

They also calculate two important ratios:

• Gross Debt Service (GDS) – The percentage of your income that would go toward housing costs (mortgage, property tax, heat, and half of condo fees if applicable).
• Total Debt Service (TDS) – Your housing costs plus all other debts combined.

Most lenders require GDS to be below 39% and TDS below 44%.

Documents Required for a Pre-Qualification

To get pre-qualified, you’ll need to provide documents that show your income, savings, and credit background.

These usually include:

• Two most recent pay stubs
• A letter of employment confirming your position, income, and start date
• T4s for the past two years (and full tax returns if you’re self-employed)
• Bank or investment statements showing your down payment
• Government-issued ID
• Details on any current debts or properties you own

Having these ready makes the pre-qualification process faster and smoother.

Does Getting Pre-Qualified Affect Your Credit Score?

Getting pre-qualified includes a credit check, but it only has a small, short-term effect on your credit score.
It’s a normal part of the process and only needs to be done once, even if we check multiple lenders for you.

How to Qualify for a Higher Mortgage Amount

Every lender looks at applications differently.
Some are more flexible with income types, others allow longer amortizations or accept higher debt ratios.

As brokers, we understand these differences and know which lender is the best fit for your situation.
That’s how we help you qualify for the highest possible amount while keeping your payments realistic and within budget.

From Pre-Qualification to Final Approval

Once you’ve found a home and your offer is accepted, we update your file with the property details and send it to the lender for full approval.

The lender will then issue a mortgage commitment, which confirms your rate, term, and any conditions.
We’ll help you through the rest — ordering the appraisal (if needed), providing updated documents, and working with your lawyer right up until closing.

What to Avoid After Getting Pre-Qualified

Your pre-qualification is based on your current financial situation.
Until your mortgage closes, try to avoid:

• Changing jobs
• Taking on new debt or credit cards
• Co-signing for someone else
• Missing or delaying payments

These changes can affect your approval or cause delays.

Mortgage Broker vs. Bank

Working with a mortgage broker gives you more options, more guidance, and more personal support.

Banks can only offer their own mortgage products and work in their own best interest.
A mortgage broker works for you, not the bank.

Here’s why many first-time buyers prefer using a broker:

• More lender options. We compare banks, credit unions, and other lenders to find what’s best for you.
• Expert advice. You get a licensed professional who explains everything clearly and helps you make informed decisions.
• Personal support. We stay in touch, give honest answers, and make sure you understand every step.
• Transparency. You’ll always know what’s happening, why, and what comes next.
• Access to exclusive deals. Through Dominion Lending Centres, one of Canada’s largest broker networks, we can often access lower rates and special programs not available at the branch level.

You don’t pay anything extra to work with a broker — we’re paid by the lender once your mortgage closes.

Ready to Get Pre-Qualified?

You can start your mortgage journey right now.
Click the Apply Now button below to complete your secure mortgage application. It only takes a few minutes, and there’s no obligation.

Getting pre-qualified will not harm your credit or have any negative effect on your financial record. It’s simply the first step toward understanding your options and finding out how much you can comfortably afford.

Once you submit your information, we’ll review your details, confirm what you qualify for, and reach out with clear next steps.
You’ll know your maximum purchase price, estimated payments, and what documents you’ll need — all before you start shopping for a home.

Start your pre-qualification today and take the first step toward owning your home with confidence.