Q – What is a mortgage agent
A – A mortgage agent is an independent professional that will work with multiple lenders to find you a mortgage that will suit your needs. They will find a lender with the best rates and terms for your situation. There is usually no fee to work with a mortgage broker if you qualify under standard lending guidelines. Your mortgage professional gets paid a commission or finders fee from the lender. If there is a fee, this will be disclosed and documented up front.
Q – When should I obtain a mortgage pre-approval for an Ontario mortgage?
A – You should obtain a mortgage pre-approval if you plan on buying in the near future in order to secure an interest rate guarantee from the lender. The interest rate can usually be held for 120 to 180 days. A pre-approved mortgage in Canada is based on the information you provide to us in your application and is subject to verification of conditions such as employment and down payment verification.
Q – What’s the min. down payment required to purchase a home in Ontario?
A – The minimum down payment is 5% to purchase a home in Ontario, subject to maximum price restrictions. In addition to the 5% you must be able to confirm that you can cover costs incurred to close your mortgage. These costs may include legal fees, appraisal fees, survey certificates etc. Subject to qualify, the 5% down paymetn can be borrowed with an additional default insurance premium added to the mortgage (an extra 0.15% if you are using a cash-back mortgage or borrowing the funds (from credit card, line of credit etc) as your down payment..
Q – If I have a declared bankruptcy can I still qualify for a mortgage?
A – Some lenders will consider your mortgage application depending on the circumstances surrounding your bankruptcy and your credit history since the bankruptcy has been discharged. The best way to determine if you can qualify for a mortgage after being discharged from bankruptcy is to call a mortgage consultant.
Q – What is required to obtain a first Ontario mortgage?
A – In most cases:
* Full time employment/proof of income
* Good credit rating
* Verifiable down payment
* Online Approval Application
Q- What can I use for a down payment?
A – In most cases:
* Registered Retirement Savings Plan (RRSP’s may be used as a down payment up to a maximum amount of 25,000 and is not subject to income tax if repaid within a specific time period)
* Gift from immediate family
* Accumulated savings
* Sale of existing home
* Sweat equity
Q – What costs are involved in obtaining a mortgage?
A – Costs incurred are:
* Legal costs (Usually between $600 – $1000)
* Insurance on the property and mortgage applicant
* In some cases an appraisal is requested
Q – How long does it take to complete a mortgage transaction?
A – If all information requested by the lender (i.e. Income verification, down payment verification and property details) are given to the broker in a timely matter than the transaction can be completed in as little as 2 weeks.
Q – What is CMHC or Genworth Insurance?
A – Canada Mortgage and Housing Corporation is a federally owned and operated institution that evaluates the client and property to allow the borrower to purchase a home with a lower down payment requirement. This corporation insures the mortgage on behalf of the bank, through a premium added to your mortgage. This way the banks are obligated to provide a mortgage for those with less than a 20% down payment.