HOME BUYING

Whether it’s your first home or your 20th, find the personalized mortgage options that fit your needs.

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HOME BUYING

Financial institutions are regularly launching new products and programs making it easier to get into your new home sooner. Finding the right option for you among interest-only loans, self-employment programs, rental purchase programs, vacation property programs and a host of other innovative financing alternatives dotting the home purchase landscape can help make homeownership a reality sooner rather than later.

Home Buying Information

Getting pre-approved for a mortgage is something every potential home buyer should do before looking for a new home! Pre-approval can give you the confidence of knowing that financing is available and put you in a very positive negotiation position against other home buyers who haven’t been pre-approved.

With a mortgage pre-approval, Max can let you know what you can afford based on lender and insurer criteria, and what your payments on a specific mortgage will be.  Having the specific dollar figure can help you determine the best home ahead of time, based on your financial needs.

Your mortgage professional can also lock-in an interest rate for you for 60 – 120 days while you shop for your perfect home. By locking in an interest rate, you are guaranteed to get a mortgage for at least that rate or better. If interest rates drop, your locked-in rate will drop as well. However, if the interest rates go up, your locked-in interest rate will not, ensuring you get the best rate throughout the mortgage pre-approval process.

In order to get pre-approved for a mortgage, a mortgage professional requires a short list of information to help determine your buying power. Max can help explain the benefits of shorter or longer mortgage terms, the latest programs available, which mortgage products meet your needs the best, in addition to reviewing any additional costs involved with purchasing a home.

The decision to choose a fixed or variable rate is not always an easy one, and should depend on your tolerance for risk as well as your ability to withstand increases in mortgage payments.

Fixed rate mortgages often appeal to home owners who want stability in their payments, manage a tight monthly budget or are generally more conservative.

Variable rate mortgages often allow borrowers to take advantage of lower rates – the interest rate is calculated on an ongoing basis at a lenders’ prime rate minus or plus a set percentage.

You can candidly discuss your options with your mortgage professional to ensure you have a full understanding of the risks and rewards of each type of mortgage.

Your credit rating affects all aspects of your financial activities, even when it comes to borrowing money for your home. Your credit report itself is simply a listing of all of your mortgage and consumer debt. A mortgage professional can help you obtain a copy of this report and go through it with you to verify that all of the information is true and correct.

In Canada, the two main credit reporting agencies are Trans Union and Equifax. Every time you borrow money, or make a payment on a loan or credit card, the lender reports the information about the transaction to these two agencies. The accumulation of all of this information is called your credit report.

The credit score, or beacon score, is a number which gives mortgage lenders an idea of your lending risk. Credit scores range from 300 to 900, the higher your credit score the better. The mortgage products and interest rate that you will qualify for are often determined by your credit score.

Remember, you have the legal right to obtain a copy of your credit report.

The good news is that your credit report is a working document. This means that you have the ability over time, to repair any damaged credit and increase your credit score, providing you with more options to own your home faster.

There are many factors to take into consideration when you select your mortgage term length.

If paying your mortgage each month places you close to the financial edge of your comfort zone, you may want to opt for a longer term mortgage, for instance ten years, so that you can ensure that you will be able to afford your mortgage payments should the interest rates increase. By the end of a ten year mortgage term, most buyers are in a better financial situation, have a lower principle balance due, and should interest rates have risen, will be able to afford higher mortgage payments.

If you are shopping for a mortgage for an investment property, you will likely want to consider choosing a longer mortgage term. This will allow you to know that the mortgage payments on the property will be steady for a long time and allow you to more accurately project your future income from the property.

Max can help choose the right mortgage term unique to you. By understanding your personal financial situation and tolerance for risk, he can assist you in your choice mortgage terms.

Mortgages in Canada are generally amortized between 25 and 35 year terms. While this may seem like a long time, it does not have to take that long to pay off your mortgage. Most people can manage to pay off their mortgage in a much shorter period of time by taking positive steps, such as:

  • Making mortgage payments each week, or even every other week. These can lower your interest paid over the term of your mortgage resulting in the equivalent of an extra month’s mortgage payment each year.
  • When your income increases, increase the amount of your mortgage payments. If you get a 5% raise each year at work, put that extra 5% of your income into your mortgage to drop your mortgage balance faster without feeling like you are changing your spending habits.
  • Mortgage lenders will also allow you to make extra payments on your mortgage balance each year. Almost everyone finds themselves with money they were not expecting at some point or another. Apply this extra money to your mortgage as a lump-sum payment to see your mortgage balance drop.
Self-employed Canadians may face roadblocks when in the market to obtain personal financing, such as a mortgage. Many Canadians have successful small business ventures but the nature of self-employment income can sometimes leave the self-employed looking like poor credit risks.

Canadian mortgage lenders understand the importance of self-employment in our culture, and are making great mortgage programs available to the self-employed to finance their primary residence and even their vacation homes.

Licensed mortgage professionals are experts at assisting self-employed individuals with getting a mortgage and will ensure you get the best mortgage available through one of Canada’s largest lenders.

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Max can help understand your financial needs and find the best solutions for your home purchase.

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