How to Get an RBC Mortgage: Step-by-Step from Pre-Approval to Closing

Understanding Pre-Approval and Why It Matters

Before you start house hunting, getting a mortgage pre-approval from RBC helps you understand your budget and locks in a rate for a period of time. An RBC pre-approval is a conditional commitment, not a guaranteed loan or commitment of financing. It provides a rate hold and a clear budget based on your financial situation.

RBC recommends getting pre-approved 90 to 120 days before you begin seriously searching for a home. This aligns with their 120-day rate hold period, ensuring you have a rate guarantee while you look for a property without needing to reapply.

• Pre-approval includes a rate hold, protecting you against rate increases during your search.
• It gives you a clear picture of how much you can afford, helping you narrow your home search.
• A pre-approval is not a final mortgage approval or a commitment to lend; final approval still depends on the property and full underwriting.

Sources: RBC Royal Bank

Gathering Required Documents: Income, Assets, and Credit

When you apply for an RBC mortgage, you'll need to provide documentation that verifies your identity, income, assets, and liabilities. While the exact list may vary based on your circumstances, RBC and independent sources commonly require the following.

• Photo ID (e.g., driver's license or passport)
• Recent pay stubs or other proof of income, such as Notice of Assessment or tax returns
• Bank statements proving your down payment and showing your assets
• Details about regular payments on debts like credit cards, loans, or lines of credit
• Employment information, including your employer's name and contact details

Sources: Forbes Advisor Canada, Ratehub.ca, RBC Royal Bank

Choosing Between a Mortgage Broker and RBC Directly

You have two main paths to apply for an RBC mortgage: going directly through RBC or using a mortgage broker. A mortgage broker can help you compare rates and products from multiple lenders, potentially including RBC, and may negotiate terms on your behalf. Going directly to RBC can be simpler if you already bank with them and want to handle everything in one place.

• RBC directly: You work with an RBC mortgage specialist, who can guide you through their specific products and policies.
• Mortgage broker: A broker can shop around across lenders and may offer more options. Availability of RBC products through brokers may vary, so confirm with RBC before proceeding.
• Both options require the same basic information and documents for your application.

Sources: Perch

The Application Process: Submission and Approval Timeline

Once you have your documents ready, you can apply for an RBC mortgage. The process involves submitting your application, providing details about your financial situation, and granting RBC permission to run a credit check. Here's a step-by-step outline of the process.

1. Complete the mortgage application, either online, over the phone, or in person with an RBC specialist.
2. Provide details about your employment, income, assets, down payment, and liabilities.
3. Authorize RBC to obtain a credit report.
4. Submit any required documents, such as photo ID, pay stubs, and bank statements.
5. Wait for RBC to review your application and perform underwriting, which typically takes one to three weeks after you have a property and your offer is accepted.
6. Receive a final mortgage approval, and then proceed to closing, which may take 30 to 60 days.

Sources: RBC Royal Bank

Rate Lock and Hold Options During Application

A key benefit of getting pre-approved is the rate hold. RBC guarantees your mortgage rate for 120 days from the date of your application. This means if interest rates rise during your home search, your pre-approved rate remains protected. However, if rates drop, you may be able to benefit from a lower rate, depending on RBC's policies.

• Rate hold period: 120 days from application date.
• Confirm with RBC whether the rate hold applies to both fixed and variable mortgage options, as the rate guarantee period is 120 days from application.
• If your pre-approval expires before you find a home, you may need to reapply and may receive a new rate.

Sources: RBC Royal Bank

What Happens After Approval: Legal and Closing Steps

After your mortgage is approved and you have a purchase agreement, the final steps involve legal and administrative tasks. You'll need to work with a real estate lawyer or notary to complete the transaction. They will handle the transfer of funds, register the mortgage, and ensure all legal documents are in order.

• Your lawyer or notary will prepare the mortgage documents and coordinate with RBC to ensure funds are available.
• Closing costs vary by province and transaction; your lawyer or notary will provide a detailed breakdown before closing.
• At closing, your down payment and any associated fees are transferred, and you receive the keys to your new home.

Sources: RBC Royal Bank