Why You Might Be Getting Pre-Approved for Less Than You Expect

Josh Perez • October 31, 2025

If you’ve been surprised by a lower-than-expected mortgage pre-approval amount, you’re not alone—and there’s usually one main reason: debt.


It’s not just about how much you make; it’s about how much of that income is already spoken for.

"We've seen people making six figures get approved for less than someone making $70,000 a year—because the higher earner had two car loans, a line of credit, and a student loan, while the lower earner had zero debt and a clean file." — Josh Perez

When lenders review your application, they don’t care much about your lifestyle—they care about ratios. If your debt servicing ratios (the percentage of your income that goes toward debt payments) are too high, it doesn’t matter how big your paycheque is—you’ll hit a cap.



Before you start house hunting, take a close look at your liabilities:

  • Car loans
  • Credit cards
  • Lines of credit
  • Student loans


Even small adjustments—like paying down a balance or restructuring existing debt—can make a big difference in how much you qualify for.


Here’s the part most people don’t realize: not all banks calculate your income and debts the same way. That means your approval could vary significantly depending on which lender reviews your application.


That’s why it’s so important to work with an experienced mortgage broker who represents you, not the bank. A broker can compare multiple lenders, spot the differences in their calculations, and help you find the approval strategy that gives you the most buying power.

Not all banks and lenders calculate your income and your debts the exact same way.” — Josh Perez

This is where strategy matters. The right mortgage professional can identify which lenders view your situation most favourably—and help you increase your buying power without changing your income.


Want to know which lender will give you the best approval?


 Book a quick discovery call with Josh to review your debt structure and uncover your full borrowing potential.

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What You Need to Know About Mortgages and Parental Leave

By Josh Perez • July 8, 2026
If the title of this article caught your attention, chances are your family is growing. Congratulations. If you’re thinking now is the right time to move into a home that better fits your growing family—but you’re unsure how parental leave affects your ability to qualify for a mortgage—you’re in the right place. Here’s the good news. Qualifying for a mortgage while on parental leave is possible when it’s done correctly. When you work with an independent mortgage professional, lenders can often qualify you based on your return-to-work income , as long as you can provide documentation confirming you have guaranteed employment waiting for you. A word of caution If you walk into a bank branch and disclose that you’re currently on parental leave, there’s a chance the bank will only allow you to qualify using your parental leave income. That can significantly reduce your borrowing power. Parental leave income is typically limited to 55% of your previous earnings, up to a weekly maximum. Qualifying on that amount alone can restrict your options and impact the type of home you can purchase. Why lender choice matters One of the biggest advantages of working with an independent mortgage professional is choice . You’re not limited to one lender’s rules or products. Some lenders will allow you to qualify using 100% of your confirmed return-to-work income , which can make a meaningful difference in your approval amount and overall options. What you’ll need to qualify Most lenders will require an employment letter that includes: Employer name (preferably on company letterhead) Your job title Original start date (to confirm probation has been completed) Confirmed return-to-work date Guaranteed salary upon return Lenders want reassurance that your income will resume once parental leave ends. You may also be asked to provide income history from the past couple of years, which is standard for most mortgage applications. One important note Whether or not you actually return to work after parental leave is entirely your decision. From a mortgage perspective, qualification is based on having a confirmed position available to you at the time of approval. If you have questions about qualifying for a mortgage while on parental leave—or anything mortgage-related—please connect anytime. I’d be happy to walk you through your options and help you plan with confidence.
Suburban two-story house with a front porch, two-car garage, and a large tree-lined lawn.

Gifted Down Payment in Ontario? Don't Skip This Step

By Josh Perz • July 7, 2026
Using a gifted down payment to buy a home in Ontario? Learn exactly what lenders require — and the common mistakes that can delay or derail your approval.