Are there any limitations with a Mortgage Pre-approval?
One thing to keep in mind is that getting pre-approved for a mortgage does not guarantee that your final mortgage application will be approved. When you apply for a mortgage after your Offer to Purchase has been accepted, your lender will look at the details of the property to make sure it is suitable. If the property does not meet their qualification criteria, you will not qualify for a mortgage. For example, if the home has asbestos, knob and tube wiring, is a heritage home, or its appraised value is below the purchase price, the lender may not find it suitable and could deny you a mortgage.
Also, getting pre-approved for a mortgage does not mean that you should buy a home at the top of your price range. Your pre-approval amount only represents how much your lender is willing to lend you, not how much you should spend. You can choose to buy a home that is priced lower than your maximum purchase price which will ensure you have enough room in your budget for saving and paying down debt.
If you need advice, you can always consult a mortgage professional, like a mortgage broker. Mortgage brokers are independent and can give you expert advice on your application for free. They can also help you compare mortgages, negotiate a better rate, and help you through the pre-approval process.