The Perils of a Pre-Approval

We had a client come through the office with a Chartered Bank “Pre-Approval” giving a rate hold and financial budget limit. To our complete shock when our deal was submitted it was denied. After a longer look at the document it said in fine print “subject to lending criteria”. As it happens the representative from the lender evidently didn’t read the file before issuing the document. We subsequently had to scramble and find alternative lending at a poorer rate… Heartbreaking and extremely stressful. Luckily we had a finance condition which allowed us to vet the mortgage before committing to a firm deal. In todays climate a finance condition is not usual as most properties are expecting over asking condition free offers. How can we protect our clients with this strategy? Mortgage Pre-Approvals are vital in your home search process but all are not created equally.

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