Why Mortgage Brokers Ask for Everything (Including Your First-Born)

If you’ve ever applied for a mortgage and thought,

“Why does my mortgage broker need all of this?”

—you’re not alone.

Pay stubs, tax returns, bank statements, down payment proof, letters of employment… sometimes it can feel like we’re asking for your life story and your first-born child just to get a mortgage pre-approval.

But here’s the truth, mortgage brokers aren’t being nosy. We’re being regulated, thorough, and protective—of you.

In this post, I’ll explain:

• why mortgage brokers ask for so many documents

• the federal and provincial rules we must follow

• how this process actually protects you as a buyer

• and how to make the pre-approval process smoother and faster

Whether you’re a first-time home buyer, self-employed, wanting to switch lenders, or refinance, this guide will help everything make sense.

Why Mortgage Pre-Approvals Require So Much Documentation

A mortgage pre-approval isn’t just a casual estimate. It’s a financial risk assessment backed by real data.

Generally we start by asking for the following documents:

• Government-issued photo ID

• Proof of income; letter of employment, recent pay stubs, etc.

• Two most recent T4s or NOAs

• Proof of down payment (90-day history of bank statements)

If you're self-employed, we'll ask for two years of your business financials, T1 tax returns (all pages), and your NOAs.

And we'll confirm your debts and credit scores through a credit bureau report.

When a lender commits to lending you hundreds of thousands (or millions) of dollars, they must verify:

• who you are

• how you earn money

• how stable that income is

• where your down payment came from

• your debts and liabilities

• your credit behavior

• your ability to handle higher interest rates

It’s Not Personal

Mortgage brokers in British Columbia are regulated at both the federal and provincial level. That means strict rules about documentation, verification, and transparency.

Federal Oversight (Canada-Wide Rules)

Mortgage brokers and lenders must follow guidelines set by Office of the Superintendent of

Financial Institutions (OSFI), including:

• The Mortgage Stress Test

• Income verification standards

• Anti-money laundering (AML) laws

• Fraud prevention requirements

These rules exist to prevent risky lending and protect borrowers from overextending themselves.

Provincial Oversight (BC-Specific Rules)

In British Columbia, mortgage professionals are licensed and monitored by BC Financial Services Authority (BCFSA).

We’re legally required to:

• collect sufficient documentation to support recommendations

• act in the client’s best interest

• keep detailed records

• verify all income and assets

• ensure mortgage suitability (not just approval)

Why Each Document Actually Matters

Here’s what those documents really do behind the scenes.

1. Income Documents

We need them to confirm your income is:

• real

• ongoing

• stable

• acceptable to lenders

Without proper income verification, lenders may decline your file or approve you for far less than you expect.

2. Bank Statements and Proof of Down Payment

Lenders must confirm:

• where your down payment came from

• that it meets anti-money laundering rules

This is why we ask for:

• 90-day history

• gift letters

• proof of savings accumulation

This protects you from last-minute declines when an underwriter reviews your file.

3. Credit Reports and Debt Details

Your credit tells a story about how you manage obligations.

We review:

• credit score

• late payments

• collections or judgments

• debt ratios

This ensures your mortgage will be affordable.

4. Explanations

Changed jobs? Had a temporary income dip? Large deposit? Late on a credit card payment?

Lenders require context.

A simple explanation can be the difference between an approval or decline.

The Mortgage Stress Test: Another Reason We Dig Deep

In Canada, buyers must qualify at a higher rate than their actual mortgage rate.

Why?

• To ensure you can handle future rate increases

• To reduce financial hardship

• To prevent forced sales

If we don’t collect accurate documents, your stress test calculation could be wrong—and that can cost you a home after you’ve already written an offer.

This Process Protects You and the Lender

It may not feel like it—but thorough documentation benefits you too.

It helps:

• prevent last-minute financing collapses

• avoid over-borrowing

• strengthen offers in competitive Lower Mainland markets

• reduce surprises during underwriting

• ensure long-term affordability

• show you what you can actually afford, so that you're shopping within your budget

  
  

In hot markets like Greater Vancouver, Tri-Cities, and the Fraser Valley, a solid pre-approval is your safety net.

How to Make the Mortgage Pre-Approval Process Easier

Here’s how to speed things up and reduce frustration:

• Be upfront

Tell your broker everything early—even if it feels awkward.

• Send complete documents

Partial docs = delays.

• Ask questions

Understanding why builds trust and clarity.

Mortgage brokers don’t ask for “everything” to make your life difficult.

We do it because:

• the rules require it

• the lenders demand it

• and your financial future depends on it

If you’re thinking about buying, refinancing, or just want to understand what you actually qualify for in today’s market, let’s talk.

Book a free, no-pressure consultation

I’ll explain exactly what’s needed, why it matters, and how to make the process as smooth as possible.

And if you know someone who’s confused or frustrated by mortgage paperwork, share this post. It might save them a lot of headaches.

As always, please reach out if you have any questions. Always happy to chat mortgages!

Nadia.