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There are two parts to mortgage approval:

  1. The buyer must be approved, and
  2. The property must be approved.

The buyer can get a pre-approved mortgage which is not actually a mortgage at all. It is the preliminary approval by the lender of the borrower's application for a mortgage and requires income verification, employment verification, a credit check and verification of down payment. It sets out the maximum mortgage amount the borrower qualifies for, with an interest rate guarantee for 30 to 120 days. This approval is subject to the lender approving the property – this requires a copy of an accepted offer to purchase, a copy of the MLS print out and a satisfactory appraisal of the subject property so it is highly advisable to make any offer to purchase conditional upon financing.

There are 3 good reasons to get pre-approved:

  1. Saves time and disappointment – It saves you time and disappointment from looking at homes outside your price range.
  2. Lock in an interest rate – You can get an interest rate locked in for up to 120 days. This protects you from any rate increases that can happen after you have written an offer but before you close on the purchase. This could save you thousands of dollars in interest.
  3. Stronger negotiating position – It makes your offer more appealing to a seller, if they know you are a qualified buyer. This means they will look at your offer more seriously which can even result in a lower purchase price.


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The data included on this website is deemed to be reliable, but is not guaranteed to be accurate by the Central Alberta REALTORS® Association. The trademarks REALTOR®, REALTORS® and the REALTOR® logo are controlled by The Canadian Real Estate Association (CREA) and identify real estate professionals who are members of CREA. Used under license.