It’s a New Day… and a New Mortgage Application

Diane Buchanan • June 15, 2016

Every time you apply for a new mortgage, your application has to stand on its own merit. Just because you were approved for a mortgage in the past doesn’t guarantee you will be approved for a mortgage in the future. Every application is its own thing! It doesn’t matter if you have have been a homeowner for 20 years with an impeccable repayment history or you are saving a down payment for your first home, we all start fresh.

So it’s always a good idea to start with or review the basics!

Mortgage financing, to the lender, is all about managing risk. In order to secure financing you will have to prove yourself as a “good risk.” To do this, lenders will scrutinize the following four areas of your mortgage application: your employment, credit history, down payment, and the property itself.

Employment

When you apply for a mortgage you are asking to borrow money, in most cases, a lot of it. The first question the lender will ask is, how can you afford to pay them back. They want to be sure that you have the ability to repay their money, with interest. And they don’t just take your word for it. Of course you believe you are good for the money… they need proof. You will be required to provide documentation that outlines your current employment status, and depending on that status, you might have to further support your income by proving a two-year history of earnings.

The stronger your employment history, the stronger your application.

Credit History

After assessing your ability to repay the mortgage by looking at how much money you make, the next best way to determine if you will make your mortgage payment on time is by looking at how you have managed other loans. Your credit report is a history of how you manage your financial obligations. It is a detailed account of every time you have agreed to borrow money, and your track record of following through. All this information is brought together inside a machine and you get what is called a credit score, which is a three-digit number between 300 and 900.

The higher your score, the stronger your application.

Downpayment

After assessing your ability to repay the money, and your past history of doing so in a timely manner, the lender wants to see that you have some “skin in the game.” Gone are the days of 100% financing, where you could get a mortgage with no money down. A 5% downpayment is the absolute minimum, where 10% is going to give the lender a lot more confidence in your ability to save money, while putting down 20% will bring you into a conventional mortgage where you don’t have to take our CMHC insurance. Typically, lenders want to see that you have accumulated your downpayment through savings, however there are other options to source your downpayment.

The more money you have to put down, the stronger your application.

Property

Most people either don’t realize or forget that the property itself is part of the mortgage application. The property is what the lender is holding as collateral in case you default on your mortgage. So if you don’t pay your mortgage as agreed, and they are forced to repossess your property and liquidate it in order to recuperate their money, they want to be sure that the property is in good shape. This is why writing a purchase agreement without a condition of financing is a bad idea. You could be the most solid applicant in Canada, but if the property isn’t a good risk, the lender won’t issue a mortgage.

There you have it. A lender will agree to give you a mortgage only when it is satisfied that:
you have an ability to repay the mortgage
you have the history to show you will repay the mortgage
you have some skin in the game
you want to buy a solid property…

The good thing about working with a Dominion Lending Centres mortgage professional is that you don’t have to approach any lender alone. We present your financial information to the lender on your behalf, and negotiate with the lender directly to ensure you get the best mortgage product available

 

This article originally appeared in the June 2016 Dominion Lending Centres Newsletter. 

DIANE BUCHANAN
 Mortgage Broker

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Need Funds Between Buying and Selling? Here’s How Deposit Loans & Bridge Financing Help

By Diane Buchanan • September 30, 2026
You’ve outgrown your current home. It no longer fits your life, so moving makes sense. And you’re not interested in juggling two properties. Selling first and buying something new feels like the right move. Ideally, you want possession of the new home before leaving the old one. That overlap makes moving easier, reduces stress, and gives you time to paint, renovate, or settle in before the boxes arrive. But there’s a common challenge. What if the down payment for your next home is tied up in the equity of the one you’re selling? That’s where bridge financing comes in. How bridge financing works Bridge financing temporarily unlocks equity from your current home once it has a firm sale . It bridges the gap between selling your existing property and purchasing your next one, allowing you to use that equity toward your down payment. What about competitive markets? In a hot market, a strong offer often means a larger deposit . If you don’t have that cash sitting in your account, but you do have equity, a deposit loan can help you compete with confidence. The non-negotiable requirement To qualify for bridge financing or a deposit loan, your current home must have a firm, unconditional sale . No firm sale = no bridge or deposit loan. Lenders need certainty to calculate available equity and manage risk. Bottom line A firm sale is the key that unlocks bridge financing and deposit loans. If you’re planning a move and want to understand how these options could work for you, let’s talk. I’m always happy to walk you through your options and help you plan your next step with confidence.

How to Qualify for a Mortgage After Bankruptcy in Canada

By Diane Buchanan • September 23, 2026
Financial setbacks happen. Bankruptcies and consumer proposals are more common than most people realize—and they don’t define your future. Going through one doesn’t mean homeownership is off the table forever. It simply means lenders want to see that you’ve taken control, learned from the past, and built a stronger financial foundation moving forward. What lenders look at after a bankruptcy or consumer proposal How long it’s been since your discharge Your discharge date matters. For lenders, this is your reset point. There’s no law that says you must wait a specific amount of time before applying for a mortgage, but the longer your track record after discharge, the stronger your application becomes. What matters most is how responsibly you’ve managed your finances since then. Your credit rebuild Re-establishing credit is critical. After discharge, most people start with a secured credit card and use it consistently and responsibly. To be considered fully re-established, lenders typically want to see: Two active trade lines At least two years of clean payment history Credit limits of around $2,500 on each No late or missed payments Your down payment or equity The more money you can put down—or the more equity you have when refinancing—the lower the risk for the lender. A stronger down payment often opens the door to better terms and more lender options. Your debt service ratios Lenders will also look closely at how much of your income goes toward housing and other debts. The stronger your income relative to your monthly obligations, the easier it is to qualify. Conventional vs. insured mortgage options To access the most competitive mortgage products, lenders typically want to see: At least two years plus one day since discharge Fully re-established credit Minimum down payment requirements met Mortgage insurance in place if your down payment is under 20% (through CMHC, Sagen, or Canada Guaranty) Total debt obligations generally not exceeding 44% of your gross income Alternative lending options Not every situation fits neatly into a bank’s box—and that’s where alternative lending can help. Independent mortgage professionals work with both traditional and alternative lenders, including those who specialize in complex financial situations. These lenders look at the full picture: equity, income stability, and your plan moving forward. While rates and terms may not be as competitive as prime lending, alternative financing can be an effective short-term solution—especially if you need a mortgage before your credit is fully rebuilt. Let’s talk about your next step Whether you’re planning ahead for the best possible mortgage—or need a solution sooner rather than later—there are options available. If you’d like help mapping out a clear path forward, reach out anytime. I’d be happy to review your situation and help you build a plan that gets you back into homeownership with confidence.