“Five years ago my girlfriend and I were pre-approved for over 400k on a mortgage, without showing or proving any income.”

“Five years ago my girlfriend and I were approved for over 400k on a loan. You know, the kind that get pre-done before you shop. Well, that was without showing or proving any income. This was by word of mouth at a mortgage broker’s office. I said I have the papers to back my claims, she said doesn’t matter, we trust your word.
Why would phoney valuations made by a computer surprise anyone in today’s environment?
We never pulled the trigger on a place… good thing too!”

kc at VREAA 23 Dec 2012 9:12am

5 responses to ““Five years ago my girlfriend and I were pre-approved for over 400k on a mortgage, without showing or proving any income.”

  1. Realistically, those unverified preapprovals aren’t worth the paper they’re printed on. Push comes to shove, you might get the loan without documentation or you might not, but they didn’t promise anything.

    Banks and lenders don’t want to do any work that costs $ without proof of seriousness (i.e. a signed agreement of purchase and sale). I sold a place privately last spring, and had one couple that was waiting on TD bank for 5 business days (over a long weekend) for a yea or nay — they wanted to know financing before they put in an offer. Sadly, they only served as stalking horses for the eventual buyers. Having another party in the house and measuring the windows for curtains (literally!) is a great way to get full price on an offer. Note to self: I should have had a good mortgage broker ready to go and on speed dial.

    • NINJA loans do exist in Vancouver, so this anecdote doesn’t surprise me (even though these people were not ninjas, the loan is). There is a good chance the lender would have approved them, if they really wanted to buy.

    • Exactly. It’s called PRE-approval for a reason. Had they gone through with a purchase then they’d have had to provide proof of income, letter from employer, etc.

  2. Thanks for the tip. Not only can one stage a house, you can stage the guests at an Open House. Brilliant! A couple cases of beer or a nice bottle of wine and some free on site appies and my friends would be game!

  3. This happened in a mortgage brokers office, half area was realtors, another section was a broker. tap tap tap and by basically doing a credit check on GF poof we were approved. We were both shocked and thought “that was TOO F’ing easy”

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