Understanding your own needs is essential to make a cogent decision in terms of your mortgage. Some prefer the best rate others prefer a lower monthly payment. Insured mortgages are applicable to those who make a down payment of less than 20% of their purchase price. These deals have a max amortization of 25 years and must be an owner-occupied property. These transactions are insured on the back end by Insurance Company like CMHC, Genworth or Canada Guaranty. Insured mortgages are typically afforded the best rates. An uninsured mortgage typically has 20% or more down payment and are amortized over 30 years. These mortgages have higher interest rates than an insured mortgage but allow you to have lower monthly payments and give you a greater ability to qualify.
Fixed mortgages have a fixed interest rate and allow you to budget a definitive manner as your payment scheme is consistent. A variable mortgage has a fluctuating interest rate that is reflective of the market condition but is typically lower than a fixed interest rate. Typically, the higher your interest rate the less will go to your principal amount. An open mortgage gives you the ability to pay off your principal mortgage amount ahead of your term without penalty. In a closed mortgage has a fixed payment for the term of your mortgage and paying off your mortgage ahead of this term will require penalty fees. Typically, an open mortgage has higher interest rates than a closed mortgage.
There are a variety of factors that are to be considered when qualifying for your mortgage. Lenders typically consider your credit history, your income capacity, existing assets and liabilities and the characteristics of your property. It would be recommended that you consult with an Affinity Mortgage Solutions mortgage agent to ensure you qualify as every situation and scenario is unique.
To ensure that your application is approved in a timely manner you should have the following documents ready: 1. Income Docs: Recent Paystubs + Letter of Employment + T4s or NOA 2. Property Docs: Existing Property Tax Bill + Existing Mortgage Statement 3. If Purchasing: MLS Listing + Agreement of Purchase and Sale 4. Assets Confirmation: Statement of Account *Self employed clients are subject to other document qualifications
Banks have 60% of the mortgage market share and act as the Lender. Brokers act as an intermediary between the client the lending institution. This ensures that the client’s best interests come first to a broker. When choosing to work through a banking institution, as a client, you have only the availability of their product line. When you work with a broker you afforded the option of choosing between multiple products with different lending institutions including major banks, schedule b banks, credit unions and private lenders. Since Affinity Mortgage Solutions’ agents have access to an open mortgage market, they can ensure you the best rates and work with mortgage applicants who do not fit the traditional banking guidelines.
Paying down your liabilities, building your credit score, building savings, ensuring your household income will suffice and obtaining your documents ahead of time will all help in completing your transaction smoothly. To strengthen your application, you should speak to an Affinity Mortgage Solutions professional on the outset of your proposed transaction so they can make recommendations.
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