What Is Mortgage Pre-Approval in Alberta?
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·Reviewed by a mortgage professional
Short answer
Pre-approval is a lender’s documented review of your income, credit, debts, and down payment that gives you a realistic budget and often a rate hold — usually 90–120 days. It is not a final approval or a guarantee on a specific property.
The plain-English version
Pre-approval helps you shop with a clear budget and makes your offers stronger. The lender verifies your documents and applies federal stress-test rules to determine what you may qualify for.
Pre-qualification, by contrast, is often a quick estimate without full documentation — useful for planning, but not the same as a documented pre-approval.
Alberta-specific considerations
- Alberta has no provincial land transfer tax, which helps your closing-cost budget compared to some provinces.
- Gifted down payments are common for first-time buyers — lenders usually require a gift letter and proof of deposit.
- Self-employed borrowers may need Notices of Assessment and business documents in addition to pay stubs.
Example scenario
A salaried buyer with two years on the job, $70,000 saved, and moderate car debt might receive a pre-approval around $450,000–$500,000 depending on rate, property tax assumptions, and the stress test — subject to lender approval on a specific property.
Common mistakes to avoid
- Treating pre-qualification as pre-approval.
- Making large purchases on credit during the process.
- Moving down-payment money between accounts without a clear paper trail.
- Assuming the pre-approval amount is a comfortable payment — budget for taxes, heating, and emergencies too.