There are 5 critical components of your mortgage that all home owners need to know about!They are mortgage terms, interest rates, amortization, down payments, and Mortgage loan insurance.
While this may not be the most exciting information, understanding these terms could be the difference from you getting a mortgage you are unhappy with or a mortgage that meets your specific needs. Take 5 minutes and read this information. It’s worth its weight in gold!
When speaking to our clients we discovered they were often confused with mortgage terminology,especially when it comes to “Mortgage Term” and Amortization.
Mortgage Term refers to the time period (T) after which you have the liberty to either pay off the whole loan or take the opportunity to renegotiate the loan terms with the current or new lender.
There are 2 types of “Mortgage Terms”
Open Term Mortgages: This means that you are free to pay off your entire balance or part of your loan without any penalties. Open mortgage tends to be for shorter time period. i.e. 6 months to 1 year.
Closed Term Mortgages: Close mortgages are opposite of open. You are not allowed to pay off the mortgage without penalties. The penalties depend upon the lender, the interest rate and mortgage term.
It is not uncommon for people to be caught by surprise with a large penalty on the day of closing at the lawyer’s office, especially when refinancing or consolidating debts.
We encourage you to browse this site and familiarize with different terms and their impact on you in the short and long term. To learn more, sign up for a FREE 30 Minute Telephone Session . We would be happy to answer your questions about mortgage terms.
What is the most commonly asked question among home buyers and remortgaging clients when it comes to mortgage terms. You guessed it – Interest Rates!
Consumer research conducted about Canadian mortgages showed that the majority of first time home buyers and remortgaging clients ask about interest rates because they don’t know what else to ask!
Just like Chinese soup! Mortgage Interest rates also come in one flavor: Sweet and Sour at the same time???!
Canadian mortgage rates are divided into 2 groups. They both have pros and cons. The most important piece of information you should know is the types of interest rates and their impact on your mortgage terms, cash flow, equity building and your sanity.
Not sure which mortgage rate is best for you? Mortgage Delivery Guy understands that this is a lot of information to take in all at once. Call us for a Free Telephone Strategy Session (TSS) or Mortgage PMS
Currently the prime rate is 3%. But, it could go up at any time! Act now before rates go up and increase the price of your monthly payment
The ultimate goal of Canadian home owners!
This is the process of paying off your entire mortgage loan. This process is also called Amortization. For mortgages in Canada, the maximum amortization time has changed to 30 years instead of 35 years in the past for new mortgages and refinancing of loans.
Call in today for a FREE No Obligation Telephone Strategy Session to learn more about how Mortgage Delivery Guy can help you with your down payment options.
This is your cash commitment to own your house. Depending on your particular situation, you have a choice to put as low as 5% and own your home. The point to remember here is that if you put less than 20% down, you have to pay a premium. We have access to banks that are ready to pay this 5% back to you, if you qualify for it. Call in today for a FREE No Obligation Telephone Strategy Session to learn more about how Mortgage Delivery Guy can help you with your down payment options.
This is the insurance you pay to banks if you decide to pay less than a 20% down payment. This mitigates the lenders risk in case you decide to default on mortgage.