The Importance of a Pre-Approval

Tracy Head • June 2, 2023

The subject of mortgage pre-approvals has been beaten to death, but I am going to circle back to this

from a different perspective.


Over the last few months I’ve run into several situations where clients have reached out with an

accepted offer in hand but have not done their homework with respect to arranging their financing.

Sometimes this is not an issue, but sometimes it is. For everyone involved in a real estate transaction there is a fair bit at stake.


For your realtor, there are countless hours spent preparing and taking you to listed properties. This can involve hours and hours, sometimes over many months, of research, coordination, and travel. When you do find a property that you want to write an offer on your realtor spends a great deal of time preparing and negotiating your offer.


For the listing realtor, there is time spent back and forth with their client and the realtor representing

the potential purchasers in addition to the time they have already spent working with the sellers getting ready to list their home.


For both realtors there is much that goes on behind the scenes to make an offer come together.

Once a seller has an accepted offer, their home is tied up while they wait to see if you have your

financing approved. They may already have an offer on another home so are making plans and spending money on inspections and appraisals for their own potential move. They are also likely excited about their upcoming move and are spending time coordinating everything from new schools or daycare to home insurance and utility hookups.


There is you. You have spent hours watching Realtor.ca and scouring listings to find your next home. You have explored potential neighbourhoods and spent days checking out possible homes. You have made arrangements to move and are excited about the home you’ve found. Then there is your mortgage person. I love what I do, and feel a great deal of satisfaction when I can find a lender for a complicated situation.


Complicated situations take hours and hours of time and research to find suitable (and palatable)

solutions.


Each application and client is slightly different, and lenders have adapted to offer a wide range of

mortgage products to suit most situations.


However, sometimes just because we are able to find a mortgage approval for you does not make it

wise to move forward with a purchase.


Lenders have different criteria and programs. Most are looking for a few basics to be in place:

  • Are you working consistently?
  • Have you paid your previous credit facilities on time and as agreed?
  • Do you have a down payment organized?


Now, mortgage options can change based on the answers to these questions.


There are a few other things that are important:

  • Have you been bankrupt in the past? Are you discharged from your bankruptcy?
  • Do you have any spousal or child support payments?
  • If your income is casual or commission-based, do you have a two-year history?


If you have not done your pre-work and its been a while since you last applied for a mortgage you may be shocked to learn that you don’t qualify for as much as you used to. You might be horrified to know that even with twenty per cent down the only option we can find is a private lender. You may not be able to wrap your head around the fact that your financing team cannot find a suitable option because of a written-off fine that you thought was not big deal.


It is heartbreaking to learn that you don’t qualify for the mortgage you need. I cannot stress enough the importance of doing your homework to have your financing lined up before you start shopping. I also cannot stress enough the importance of full disclosure with your mortgage person. Sharing any of the skeletons in your closet can help us get ahead of any problems they may cause.


I really take it to heart when I can’t find a suitable option for good people. I want to set my clients up for long-term success and make sure I am not setting them up for disaster or disappointment.

I do love spending as much time as needed educating my clients and helping them prepare so that when they are ready to move forward we find a great mortgage product for them. On a different note – if you are a home owner you should have your 2023 tax bill by now. Make sure you read the form and claim your Home Owners Grant.


If this is your first year in your home and your lender is collecting your property taxes for you, check the upper right corner of your tax notice to make sure it shows your lender. If not, reach out to your

mortgage lender (or broker if you worked with one) to make sure the lender is paying your property

taxes as agreed. Every once in a while there is a disconnect and it is far easier to sort out ahead of time

as opposed to when you get a notice in August that your property taxes are owing.

Tracy Head

Mortgage Broker

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Navigating Mortgage Renewals in Uncertain Times

By Tracy Head • April 2, 2026
If you’re one of the many Canadians with a mortgage renewal coming up this year, you’ve likely felt a bit of unease reading the headlines. Interest rates, inflation, global tensions—it can feel like a lot. After more than two decades in this industry, I can tell you this: uncertainty is nothing new in real estate or lending. What matters most is how you respond to it. The good news? You have more control than you might think. Let’s walk through a few practical, level-headed strategies to help you approach your renewal with confidence—rather than stress. 1. Start Early—Earlier Than You Think One of the biggest mistakes I see homeowners make is waiting for their lender’s renewal letter to arrive. By then, you’re already on their timeline—not yours. I recommend starting the conversation at least 4–6 months before your maturity date. This gives you time to explore options, secure a rate hold if available, and avoid being rushed into a decision. 2. Don’t Just Sign the Renewal Offer It may be convenient to simply sign and send back your lender’s offer—but convenience can come at a cost. In many cases, lenders don’t present their most competitive rates in renewal letters. Think of your mortgage like any other major expense: it deserves a second look. Even a small difference in rate can translate into thousands of dollars over your next term. 3. Consider Your Risk Tolerance—Not Just the Rate In uncertain times, it’s tempting to try to “time the market.” Fixed or variable? Short term or long term? These are important questions—but they shouldn’t be driven by headlines alone. Instead, ask yourself: Do I value stability and predictable payments? Am I comfortable with some fluctuation if it means potential savings? How long do I realistically plan to stay in this home? There’s no universal “best” option—only the best fit for your comfort level and financial goals. 4. Explore Shorter Terms as a Bridge Strategy With so much unpredictability in the global landscape, some homeowners are opting for shorter-term mortgages (1–3 years) as a way to “wait and see.” This can be a smart approach if you believe rates may stabilize or improve, but it’s important to weigh this against current pricing and your tolerance for future changes. Think of it less as gambling on rates—and more as maintaining flexibility. 5. Use This Opportunity to Restructure A renewal isn’t just about accepting a new rate—it’s a chance to revisit your overall strategy. You might consider: Adjusting your amortization to improve cash flow or accelerate payoff Consolidating higher-interest debt into your mortgage Adding prepayment privileges to give yourself more flexibility This is your moment to align your mortgage with your current life—not the one you had five years ago. 6. Build a Small Buffer Into Your Budget Even if you secure a great rate, it’s wise to prepare for slightly higher payments—especially if you’re coming off a historically low rate. Creating a bit of breathing room in your monthly budget can reduce stress and give you options down the road. If rates drop, you’re ahead. If they rise, you’re prepared. 7. Lean on Professional Advice The mortgage landscape has become more complex, not less. Policies shift, lender appetites change, and new products emerge. A good mortgage broker doesn’t just shop rates—they help you interpret the landscape and make decisions that suit your long-term financial well-being. At the end of the day, uncertainty doesn’t have to mean instability. With the right preparation and a thoughtful approach, your renewal can be an opportunity—not a setback. If there’s one takeaway I’d leave you with, it’s this: stay proactive, stay informed, and don’t be afraid to ask questions. You’re not just renewing a mortgage—you’re shaping your financial future.  And that’s worth doing well.

Purchase Plus Improvements

By Tracy Head • March 19, 2026
Hammer, Nails… and a Mortgage That Sees Potential Over the years I’ve noticed a pattern: buyers fall into two camps. The “this house is perfect” crowd… and the “this could be perfect if we just fix a few things” crowd. Today, we’re talking about the second group—and one of the most underused tools in the Canadian mortgage world: the purchase plus improvements mortgage. What Is It (and Why Should You Care)? A purchase plus improvements mortgage lets you roll renovation costs into your mortgage at the time of purchase. Instead of draining your savings—or worse, putting renovations on a high-interest line of credit—you finance those upgrades at your mortgage rate. In plain English: you buy the house and fix it up, all in one tidy package. You get to enjoy the renovations while you live in your home, rather than scrambling to renovate or update when you are getting ready to sell. Lenders like this because you're increasing the value of the home. You should like it because you're borrowing at (usually) the cheapest rate you'll ever get. Let’s say you’ve found a home priced at $700,000. It’s solid—but a little tired. You want to: Upgrade a dated bathroom Replace an aging furnace Put on a new roof Total improvement budget: $40,000 With a purchase plus improvements mortgage, your financing is based on the “as-improved” value, meaning: Purchase price: $700,000 Improvements: $40,000 Total financed value: $740,000 Because the purchase price exceeds $500,000, the minimum down payment in Canada is not 5% flat. It’s calculated as: 5% on the first $500,000 = $25,000 10% on the remaining $240,000 = $20,000 Minimum required down payment: $49,000 Mortgage Before Insurance Total value: $740,000 Down payment: $49,000 Base mortgage: $691,000 Adding the CMHC Insurance Premium Because your down payment is under 20%, mortgage default insurance applies. At this loan-to-value (roughly 93.4%), the CMHC premium is 4%. CMHC premium: $691,000 × 4% ≈ $27,640 This premium is typically added to the mortgage, not paid upfront. Total mortgage after insurance: ≈ $712,421 What Does That Payment Look Like? Now let’s plug that into real numbers: Mortgage: $712,421 Rate: 3.99% Amortization: 25 years Estimated monthly payment: ≈ $3,750–$3,760/month (call it $3,755/month for coffee-shop accuracy). Why This Still Makes Sense Here’s where people sometimes hesitate: “Wait—I’m paying insurance and financing renovations?” Yes. And in most cases, it still works in your favour. Because: You’re financing renovations at 3.99%, not 8–10%+ You’re improving the home’s value immediately You’re avoiding the markup baked into fully renovated homes In other words, you’re not just spending money—you’re strategically improving the value of your new home. How It Actually Works Behind the Scenes Here’s the part most buyers don’t realize: You submit quotes for the renovations upfront The lender approves the total (purchase + improvements) The purchase closes as usual The renovation funds are held back by your lawyer You complete the work Funds are released once the work is verified It’s a bit of paperwork—but compared to juggling contractors and separate financing? It’s a win. Why I Recommend This More Often Than You’d Think After years in this business, I can tell you this - the “perfect home” usually comes with a premium price tag. But the “almost perfect” home? That’s where the opportunity is. With a purchase plus improvements mortgage, you can sometimes: Buy in a better neighborhood Customize the home to your taste Avoid bidding wars on fully renovated properties Finance upgrades at mortgage rates (instead of 8–10%+ elsewhere) If you’re considering this route, here’s my advice: Get detailed quotes (not ballpark guesses) Plan for a buffer—renovations love surprises Work with a broker early (this is not a last-minute add-on) And most importantly: don’t be scared of a home that needs work. Some of the best purchases I’ve seen over the years started with the phrase, “Well… it’s not perfect, but…” Final Thought A purchase plus improvements mortgage isn’t just financing—it’s strategy. It’s the difference between settling for someone else’s vision… and building your own, from day one.  And in a market like Canada’s, that kind of flexibility isn’t just nice to have—it’s powerful.