Hey Everyone,
This is one of the most common questions I get:
“If we’re already pre-approved, why do we still have to make our offer subject to financing?”
It’s a fair question and the answer can save you a ton of stress (and potentially a ton of money).
💡 First, let’s clear this up:
Pre-approval is a great starting point.
It tells you how much you can likely borrow, helps you shop with confidence, and shows sellers you’re serious.
But…
A pre-approval is based on your financial situation alone — your income, debts, credit, etc.
It doesn’t factor in the specific property you’re buying.
🏠 That’s where the financing condition comes in.
When you make an offer on a home, your lender needs to:
Approve you (already done!) ✅
Approve the property 🏡
And the property matters more than most people think. Here’s why:
The home’s appraised value — The lender wants to make sure the price you’re paying matches what the home is actually worth. If the appraisal comes in lower than your offer, they may lend you less.
Its condition — Major issues like a damaged roof, foundation cracks, or out-of-date electrical can raise red flags and may require repairs before financing is approved.
Location or zoning issues — Homes in remote areas, agricultural zones, or with unusual zoning can complicate financing, especially if resale would be tricky.
Condo rules or reserve funds — If you’re buying a condo, the lender will review the building’s financial health and bylaws. A poorly managed building or low reserve fund can impact your approval.
Marketability (especially in rural or unique areas) — Lenders ask themselves, “If we had to resell this property, could we?” Homes that are highly customized or located in slow markets may be harder to finance.
All of these factors help the lender determine whether they’re comfortable lending on that specific home — and under what terms.
🛑 What happens if you skip the financing condition?
If you remove that clause, make an offer, and the lender doesn’t approve the home you could be on the hook to complete the purchase without financing.
And that can mean:
Losing your deposit
Legal consequences
A huge financial headache
So yes, even with a rock-solid pre-approval, you want that condition in place, at least until we’ve fully locked everything in.
Think of your pre-approval as the green light to start shopping. The financing condition keeps everything safe when it comes times to buy.
📲 Got questions about your own approval?
Let’s walk through it together so you know exactly where you stand.
👉 Text me, 250-919-5474
One call, no pressure, just the clarity you deserve.
Talk soon,
— Andrew
Myplace Mortgages
Text me, right now! 250-919-5474
I don’t say this on a whim, I’m serious, if you text me now, I can show you exactly where you stand within a few hours. No stress, no pressure, no obligation.
Just a simple text that can put you at ease.