Home › Tools › Pre-Qualification Tool
Seven questions, about ninety seconds, and a realistic range instead of a guess. It is worked on the rules a Canadian lender actually applies — the stress test, both debt service ratios, the minimum down payment and the insurance premium — not a rule of thumb about three times your income.
Stephen Green, Mortgage BrokerWaterloo Region · serving all of Ontario
An estimate, not an approval. Nothing here is a commitment to lend, and every figure is subject to a lender’s own assessment and final terms.
Four rules do most of the work, and every one of them is a rule a lender applies rather than a preference of ours.
You do not qualify at the rate you are offered. Lenders test the payment at the greater of your rate plus two per cent and the statutory floor. Every figure in the tool uses that higher rate, which is why the answer is lower than most online calculators give you.
The first measures what the home costs you against what you earn — payment, property tax, heat, and half of any condo fee. The second adds every other monthly payment. Whichever runs out first is what caps you, and the tool tells you which one it was.
Five per cent of the first $500,000, ten per cent of the part between $500,000 and $1.5 million, and twenty per cent at and above that — where a mortgage can no longer be insured at all. Under twenty per cent, an insurance premium is added to the loan.
Fixed mortgages in Canada compound semi-annually, not monthly. It is a small difference on any one payment and a large one over an amortization, and it is the single most common error in a calculator written for the American market.
Property tax varies enough between municipalities to move what you can carry by tens of thousands, so the tool asks where you are looking rather than assuming an average. The rates behind it are reviewed weekly.
An insured mortgage amortizes over twenty-five years, or thirty when at least one buyer has not owned before. That is worth real money on the monthly payment, and the tool applies it automatically once you say it is your first home.
Worth being plain about, because a number on a screen is easy to mistake for a decision.
Nobody has verified anything. A lender will want pay stubs, a letter of employment, notices of assessment, proof of the down payment and a look at your actual credit file. Any of those can move the number in either direction.
A pre-approval is a real submission with real documents, and it is what a realtor will ask you for before writing an offer. This is the conversation before that one — it tells you whether the pre-approval is worth starting.
Nothing here touches your credit file, and the question about your credit is only there so the answer you get is framed honestly. What you tell us cannot change the arithmetic, because a self-reported credit rating is not something a debt service ratio can use.
A home you will live in. Rental properties are qualified on entirely different rules — how much of the rent counts, what the lender requires, and how the down payment works — and pretending otherwise would give you a number that does not apply.
Most of them qualify you at the rate you would actually pay. Canadian lenders do not — they test the payment at a higher rate to be satisfied you could still carry it if rates moved. A calculator that skips the stress test will always give you a bigger number, and it will not be a number any lender recognises.
No. Nothing here touches your credit file. There is no credit check, no account and no soft or hard inquiry.
Every figure is worked out in your own browser as you go. Nothing is sent anywhere until you choose to send it on the last screen, and the tool tells you exactly who receives what before you start.
Your name, how to reach you, the area you are looking in and a general income range — so they know what to show you. They are not sent your debts, your credit answer or your exact income. That is stated on the first screen before you answer anything.
Not usefully. Rental qualification turns on how much of the rent a lender will count, which varies, and on down payment rules that do not apply to a home you live in. Call us for that one — it is a conversation rather than a calculation.
Usually not. The tool names the one thing holding the figure down and shows what would move it, worked on your own numbers rather than in general terms. Quite often it is a single car payment or a card balance, and that is a much shorter conversation than people expect.
A pre-qualification tells you where you stand. A pre-approval is what a realtor will ask for before you write an offer, and it takes documents rather than answers. Bring what you have and we will start it properly.