This is the first stage where a lender looks at your file and says what it would lend. It is not a promise, it has an expiry date, and it says nothing about the property you have not bought yet. Understanding those three limits is most of what this stage is for.
Pekoe Mortgages is licensed in Ontario (FSRA #13321) and Alberta (RECA). This stage page routes you to the answer. It does not replace it.
Which lender is likely to fund you, and on what terms. Stage 1 told you what your file supports. This stage tests that against a real lender’s rules and holds a rate while you shop.
A credit check happens here, which is the main reason not to run this stage before you are reasonably serious. The output is a pre-approval and a rate hold, both with an expiry.
| Step | Who does it | What it produces |
|---|---|---|
| Submit a full application, not an estimate | You and your broker | A file a lender can actually assess |
| Consent to a credit check | You | The credit report the lender underwrites against |
| Match the file to a lender whose rules it fits | Your broker | A shortlist, not a single default bank |
| Lender reviews and issues the pre-approval | Lender | A maximum amount, a rate hold, and conditions |
| Read the conditions attached to it | You and your broker | Knowing what could still undo the approval |
| Note the expiry date and diarise it | You | A deadline to buy within, or to renew the hold |
A pre-approval is issued on you. It is not issued on a property, because at this stage there is not one.
Supplying documents and consenting to the credit check. Answering questions about anything unusual in the file.
Choosing which lender sees the file. This is the decision that most affects the outcome, and it is the reason not to walk into one bank.
Assessing you against its own rules and issuing the pre-approval, the rate hold and the conditions attached to both.
No lawyer, no appraiser, no real estate agent is needed for this stage to finish.
| Document | Why it is needed | What delays it |
|---|---|---|
| Letter of employment and recent pay statements | To verify the income the application claims | A new job, a probation period, or a recent change in pay structure |
| Two years of filings if you are self-employed | Self-employed income is assessed on filed returns, not on revenue | Returns not yet filed, or a recent year that looks unrepresentative |
| Proof of down payment with 90 days of history | The lender has to see the money and trace where it came from | Recent transfers, cash deposits, funds held outside Canada |
| Photo identification | Required before a lender can act on the file | Expired identification |
| Consent to the credit check | No assessment happens without it | Nothing, but it is the point of no return for your credit file |
How the process runs. Getting a mortgage in Ontario, start to finish and the same in Alberta.
What a pre-approval is worth. How long it lasts, whether you can still be declined afterwards, and why it does not do the job of a financing condition.
What the pre-approval actually holds. The rate hold, and what changes at commitment, which is the gap most surprises live in.
Your credit through this stage. Whether a pre-approval hurts your score.
Unusual files. A mortgage certificate where litigation is pending.
No. It is a lender indicating what it would lend based on you, before it has seen a property or done final underwriting. It can still be declined later.
A lender pulling your credit is a hard enquiry and can have a small effect. Multiple mortgage enquiries in a short window are generally treated as one, but do not spread them over months.
It comes with an expiry date, and the rate hold attached to it has its own. Diarise both, because buying after they lapse means repeating this stage.
You can, but each one is a separate credit enquiry and a separate file. A broker approaching the right lender once is usually a better use of the enquiry.
A pre-qualification is an estimate based on what you say. A pre-approval involves documents and a credit check, so it carries more weight with a seller.
No. It assesses you, not the property. The property is assessed at stage 4, which is why stage 3 keeps a financing condition in the offer.
Tell your broker immediately. Lenders re-verify income before closing, and a change discovered late is one of the common reasons a file falls apart.
Stage 3, making the offer, where the financing condition protects you against the property failing to support the mortgage you have been approved for.
Pekoe Mortgages is a licensed brokerage in Ontario (FSRA #13321) and Alberta (RECA). This page is general information, not financial advice, and does not create a broker and client relationship.