Why should I use a Broker?
More lenders are competing for your business. New features and options are being introduced every day. Knowing what’s right for you – and how much to pay – is becoming increasingly complicated. Maybe that’s why more than one in five Canadian mortgages are now handled by mortgage brokers. Consumers like you are increasingly discovering they just don’t have the time to shop from one lender to the next, trying to figure out which deal is best.
As your chosen mortgage broker, we invite you to read through this article and learn more about the concept of letting an independent, unbiased professional help you find the best-available deal on your mortgage. Then, give us a call toll free 1-877-566-7049, and we’ll answer any questions you may have about our no-fee service. We will do a simple hassle-free analysis of your financial situation to determine what type of mortgage can best achieve your goals.
What is Broker?
Just as an insurance broker finds you the best deal on insurance, a mortgage broker finds you the best deal on a mortgage. Rather than working for one financial institution, we are independent and deal with several different financial institutions. This allows us to offer you more choices and more competitive rates. It also means that our advice is impartial and based on whatever is in your best interest.
Who are the lenders you deal with?
Numerous Banks, Trust Comany's and Private Lenders
Do you charge a fee for processing my application?
Not usually. 97 times out of 100, the lenders pay us to deliver mortgage clients to them. In the case where the application cannot be placed with a lender that pays fees, (due to bad credit qualification), a fee maybe charged. The client is aware of the fee, at time of application. They are free to decline the mortgage service at that time. If the client decides to accept the fee, it is payable on closing of the mortgage transaction. In the case of a purchase or a refinance, this is done at the lawyers office.
Would the completion of the pre-approved application reflect on credit file - as an inquiry?
No. Our policy is not to access credit information unless we have a complete application and we have determined that the likelihood of being able to help the client is high. That determination cannot be made without a discussion with the client, first.
Can I qualify for, and afford a mortgage?
Do you know whether you qualify for a mortgage and, if you do, do you know how much you can afford? Before you can even begin to think about buying a home, you should answer both of these crucial questions. Qualifying for a mortgage Most lenders look at five factors when determining whether you qualify for a mortgage loan: · your income · debts · employment history · credit history · value of the property you want to buy One of the first questions a lender will consider is how much of your total income you’ll be spending on housing. This helps the lender decide whether you can comfortably afford a house. A lender will then look at your debts, which generally include house payments as well as payments on all loans, charge cards, child support etc. that you make each month. A history of steady employment, usually within the same job for several years, helps you to qualify. But a short history in your current job shouldn’t prevent you from getting a loan, as long as there have been no gaps in income over the last two years. Good credit is very important in qualifying for a loan and the lender will want to know that the house is worth the price you plan to pay. How much can you afford? The size of your down payment affects the amount of your monthly mortgage payments. A smaller down payment will mean your monthly mortgage payments will be higher, but it may allow you to buy sooner rather than later. A down payment of 25 per cent or more will qualify you for a conventional mortgage. If it is less than 25 per cent, the mortgage must be insured with a mortgage insurance company, such as Genworth Financial Canada. Homes can be purchased with as little as five per cent down. Mortgage payments for principal, interest and taxes generally should not exceed 30 per cent of your gross monthly income. Simply multiply your gross monthly income by 0.30 to determine your maximum monthly payments. If your gross monthly income is $4,000, the most you can afford is $4,000 x 0.30 = $1,200.00. Don’t forget closing costs such as land transfer tax, legal fees, building inspection, home insurance and realtor fees, which can amount to 1.5 per cent of the purchase price. When budgeting, also consider other monthly-related expenses such as condominium fees, heat, hydro, water, property tax, insurance and household maintenance. And one last tip – get a pre-approved mortgage. This free service from lenders comes with no obligations, helps to confirm your financial boundaries, and frees you to focus on finding the home you want.
