It is increasingly surprising at the number of people who don't take the time to pre-approve before they go out home shopping. Is is a terrible feeling to have to tell people who have entered into a conditional purchase and sale agreement that they will not be able to secure financing for the property they have finally selected. When you pre-approve, you have nothing to lose and everything to gain.

If you are in the market for a new home and need to determine what you can afford to shop for, then now is the time. In today's mortgage market some lenders are offering to hold mortgage rates for up to 120 days while you shop for your new home. Many will also match the builder's rate cap program if your home does not close within 120-day period. That's not the only plus - it gets even better.

When you pre-approve with a lender, you are automatically guaranteed an interest rate no greater than the rate for which you are pre-approved. At the same time, if interest rates go down after you pre-approve, you are usually given the benefit of that lower rate. To put it more simply - the financial institution with which you pre-approve is going to pay the costs of you playing the interest rate game.

The fact that the financial institution bears the risk of interest rate fluctuations is only one of the benefits that a pre-approval has to offer. By pre-approving with a good lender or mortgage financing.

You learn about what you need in the way of income verification, downpayment, credit rating, and mortgage products. You learn to understand the benefits of going with a short or longer term. You learn what incentives and kickback programs there are in the market, and which mortgage products will best meet your needs.

Be prepared before you talk with your mortgage professional. The following is a list of all the necessary information you will need to secure home financing:

a. Be prepared to have your employer give you a letter on company letterhead outlining your name, position, gross annual income, and number of years employed with the company.

b. If self employed, three years financial statements, and tax returns (together with official assessment from Canada Customs and Revenue).

c. Social Insurance Number(s)

d. At least 3 years' history of residences and employers.

e. Know your banking information (i.e. institution's name, address, type of accounts, account numbers).

f. Know your assets and their value (i.e. cash amounts, stocks, bonds, RRSPs, car).

g. Know your liabilities (i.e. car loan, credit card balances).

h. Always let the lender know any past credit problems you may have had. Many people have them, but just be sure you can give an exact recount of the details surrounding any late payments.

Don't be the next person to go home shopping only to discover you are not qualified, or that you could be getting your dream home now. Talk to your mortgage broker or lender and get the peace of mind offered by a pre-approval.

Calum Ross is a Vice President and practicing Mortgage Consultant with The Mortgage Centre. He has appeared on Canada AM, Investment Television, Report on Business Television, City TV, and is a regular mortgage columnist. He is the holder of both a B.Comm. and MBA in Finance.