If you’re planning to buy a home in Ontario, one of the first things you’ll hear is:
“Get pre-approved before you start looking.”
But what does a mortgage pre-approval actually mean?
And more importantly, what does it not mean?
In today’s competitive market, understanding how pre-approvals really work can help you avoid rejected offers, financing stress, and last-minute surprises. This guide explains what a mortgage pre-approval is, how it works in Ontario, and how working with the right lender, or broker, can make all the difference.
What Is a Mortgage Pre-Approval?
A mortgage pre-approval is a conditional confirmation from a lender that outlines:
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How much you may be able to borrow
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An estimated interest rate (often held for a limited time)
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A basic review of your credit, income, and debts
It gives buyers a starting point, not a final guarantee, but it helps set realistic expectations before making an offer.
A pre-approval is especially useful because it:
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Defines your price range
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Strengthens your position with realtors and sellers
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Reduces uncertainty during the buying process
What a Pre-Approval Is Not
This is where confusion often happens.
A mortgage pre-approval is not a final approval. It does not guarantee funding, and it can still change based on:
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The specific property you buy
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The final review of documents
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Changes to your income, debts, or credit
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Lender-specific property rules
This is why buyers who rely only on a quick bank pre-approval can still face problems later, especially in fast-moving or competitive transactions.
How Mortgage Pre-Approvals Work in Ontario
In Ontario, lenders assess several key factors during a pre-approval:
1. Income
Lenders review how you earn your income and how stable it is.
This includes:
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Salaried or hourly employment
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Self-employed or contract income
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Bonuses or commissions (with conditions)
Different lenders treat income differently, which is why having access to multiple lenders matters.
2. Credit Profile
Your credit score and history help determine:
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Which lenders you qualify for
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What interest rates are available
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Whether conditions may apply
Borrowers with bruised credit may still qualify through alternative or private lenders, even if a major bank declines.
3. Debts and Monthly Obligations
Lenders calculate how much of your income already goes toward:
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Loans
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Credit cards
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Lines of credit
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Support payments
This affects how much mortgage you can carry responsibly.
4. Down Payment
Lenders verify:
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Where the funds are coming from
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How long they’ve been in your account
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Whether part of the down payment is a gift
The structure of your down payment can affect which lenders are available to you.
Why Working With a Mortgage Broker Makes a Difference
Unlike a single bank, a mortgage broker can access:
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All major Canadian banks
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Credit unions
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Alternative lenders
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Private lenders
This matters because no two lenders assess risk the same way.
At Burke Financial, we don’t just issue pre-approvals, we:
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Match buyers with the right lender from the start
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Consider future property type and offer strategy
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Help realtors submit stronger, cleaner offers
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Find solutions even when timelines are tight
In many cases, we can also move beyond a basic pre-approval and secure stronger, lender-backed approvals once a property is identified.
Why Pre-Approvals Matter for Realtors and Buyers
For buyers:
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You shop with confidence
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You avoid overextending financially
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You reduce deal risk
For realtors:
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Offers are cleaner and more credible
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Fewer financing-related collapses
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Faster closings and smoother transactions
That’s why mortgage–realtor collaboration is critical, especially in competitive markets.
How Long Does a Mortgage Pre-Approval Last?
Most pre-approvals are valid for 90–120 days, depending on the lender.
However, changes during that time, such as:
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New debt
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Job changes
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Missed payments
can impact the final approval.
That’s why ongoing communication with your broker is just as important as getting the pre-approval itself.
Common Pre-Approval Mistakes to Avoid
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Assuming a pre-approval guarantees financing
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Making large purchases after getting pre-approved
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Changing jobs or income structure mid-process
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Relying on a single lender’s opinion
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Waiting until an offer is accepted to review details
Avoiding these mistakes can save you thousands, and a lot of stress.
Final Thoughts: Pre-Approvals Are a Tool, Not a Promise
A mortgage pre-approval is an important first step, but it’s only effective when it’s done properly, with the right lender strategy behind it.
When combined with expert guidance and access to both major banks and alternative lenders, a pre-approval becomes a powerful tool that supports confident buying and successful closings.
📞 Ready to Get Pre-Approved the Right Way?
Whether you’re buying your first home, upgrading, or working with a realtor, we’ll help you understand your real options, clearly and honestly.
📞 1-866-702-9394
🌐 www.burkefinancial.ca
