Residential Mortgages

Buying a home is one of the most important decisions that you will make. It is also one fraught with difficulties and usually some tension since it involves large amounts of money and a long personal commitment to make monthly payments.

The right advice at this time is absolutely crucial, as the decisions made could have a major financial impact on you and your family. With ongoing changes to the Canadian financial landscape and with more stringent regulations now in place, you can’t afford to borrow without the best advice. Turkin Mortgage team specialises in mortgage applications and will gladly assist you.

Most people require a mortgage to fund the purchase of a home. You will need a decent credit record, and proof of regular, dependable income before the bank will even consider lending you the money.

In line with recent legislation, if you apply for a mortgage through a bank you will have to take a stress test. The stress test evaluates your ability to make repayments even if interest rates increase. It is therefore in your own best interest to reduce outstanding credit, increasing the amount that you will be allowed to borrow. Many people in the Mississauga area have had to downgrade their first choice of home or find one in an alternative location due to restrictions placed on the amount that they have been allowed to borrow.

Without careful planning, you run the risk of defaulting. Repayments are not the only costs that homeowners face, there are a number of additional costs surrounding home ownership. These include heating, property taxes and general household maintenance, and they must be included in the budget.

In Canada a down payment on the property is mandatory as the maximum finance you will be allowed even with an excellent credit rating is 95% of the value of the property. In other words, you have to make a down payment of 5% and cover the mortgage closure costs. The higher the down payment the less interest you will pay.

Listed below are some of the crucial choices that you will have to make before signing your mortgage agreement

• Amortization period – how long will you take to pay the mortgage off? This can be as much as twenty-five years.
• Closed or open mortgage – a closed mortgage cannot be paid up early, unless by agreement with the lender, and with payment of penalties. You can settle the open mortgage any time during the amortization period.
• Fixed or variable interest rates – fixed interest rates are fixed for a period. The interest rate may be higher than the variable rate but it takes away the uncertainty.

  It is advisable to obtain a pre-approved mortgage before you look for your home, as this could save time and a lot of disappointment.

  Understanding the options and the legislation involved in applying for a mortgage can help you to plan ahead and avoid some of the stresses associated with purchasing a new home. Professional mortgage brokers have the expertise and the contacts to help you every step of the way.