HOW TO IMPROVE YOUR MORTGAGE APPROVAL CHANCES IN BC
Buying a home in British Columbia can feel overwhelming, especially with rising housing prices and strict lending rules. Whether you’re a first-time buyer or moving up the property ladder, getting approved for a mortgage is the first big hurdle.
Here’s a step-by-step guide to boost your mortgage approval chances in BC and make lenders see you as a strong, reliable borrower.
1. Know Your Credit Score and Improve It
Your credit score is one of the first things lenders look at. In BC, most lenders want to see a score of at least 680 for the best mortgage rates.
Tips to improve your score:
• Pay all bills on time, including credit cards and utilities
• Keep your credit card balances below 30% of your limit
• Avoid applying for new credit right before your mortgage application
• Check your credit report for errors (Equifax and TransUnion are the main bureaus in Canada)
Pro tip: Improving your score by even 20 points can sometimes mean a lower interest rate, saving thousands over your mortgage term.
2. Save for a Larger Down Payment
The minimum down payment in Canada is:
• 5% for homes under $500,000
• 5% on the first $500,000 + 10% on the portion between $500,000 and $999,999
• 20% for homes $1M or more
A bigger down payment lowers your mortgage amount, reduces your monthly payments, and shows lenders you’re financially responsible.
Ways to boost your down payment:
• Use the First Home Savings Account (FHSA) or RRSP Home Buyers’ Plan for tax-free withdrawals
• Cut discretionary spending for 6–12 months
• Consider a side hustle or extra income source
3. Reduce Your Debt Load
Lenders look at your debt-to-income ratio (DTI) — the percentage of your monthly income that goes toward debt payments.
To improve your DTI:
• Pay off high-interest debt first (like credit cards)
• Consolidate loans for lower payments
• Avoid taking on new debt before applying
Rule of thumb: Aim for a total debt service (TDS) ratio under 42% to meet most lender requirements.
4. Have Stable Income and Employment
Lenders love stability. Being in the same job for at least two years strengthens your application.
If you’re self-employed, you may need:
• 2+ years of tax returns
• Business financial statements
• Bank account history showing steady income
5. Get Pre-Approved Before You Shop
A mortgage pre-approval in BC gives you a clear idea of how much you can afford and locks in an interest rate for 60–120 days.
Benefits of pre-approval:
• Shows sellers you’re a serious buyer
• Helps you stay within budget
• Protects you from rate increases while you search
6. Work with a Mortgage Broker
Mortgage brokers have access to multiple lenders, including banks, credit unions, and alternative lenders. They can often find better rates and work with clients who don’t fit the “perfect borrower” profile.
7. Prepare All Your Documentation in Advance
Being organized speeds up the process and avoids last-minute delays.
Have these ready:
• Recent pay stubs
• T4s or tax returns (last 2 years)
• Bank statements
• Proof of down payment (and source)
• Photo ID
Getting approved for a mortgage in BC isn’t just about income — it’s about showing lenders you’re a low-risk borrower. By improving your credit, saving more, reducing debt, and getting pre-approved, you’ll be in a much stronger position to secure the financing you need.
Start by checking your credit score today and setting a target for your down payment. The earlier you prepare, the easier your approval process will be.