Frequently Asked Questions
Should I get pre-qualified before I find the home I want to purchase?
Yes. Getting pre-qualified will insure that you know how much you can be approved for and everything else is in line such as credit and required income documents.
How much can I qualify for?
Qualifying guidelines vary depending on the lenders criteria and products available. To find out exactly what you can qualify for, please submit your application for a pre-approval.
What can I use for a down payment?
In most cases:
RRSP | First time Home Buyer's Plan
Gift from immediate family
Sale of existing home
Gifted Equity from current owner (Usually required to be immediate family)
What costs are involved in obtaining a mortgage?
The main costs incurred are:
Property Tax Adjustment
Property Transfer Tax (may not be applicable for First Time Home Buyers)
Appraisal Fee (May not be required)
Mortgage Default Insurance
What is mortgage default insurance? (CMHC, Genworth, Canada Guaranty)
Mortgage default insurance is required by lenders when homebuyers make a down payment of less than 20% of the purchase price. Mortgage loan insurance helps protect lenders against mortgage default, and enables consumers to purchase homes with a minimum down payment of 5%
To obtain mortgage loan insurance, lenders pay an insurance premium. Typically, your lender will pass this cost on to you. The premium payable is based on a percentage of the home’s purchase price that is financed by a mortgage. The premium can be paid in a single lump sum or it can be added to your mortgage and included in your monthly payments.
How does mortgage default insurance work?
If a borrower stops making mortgage payments or breaches the mortgage contract in some other way, the bank may “enforce” its mortgage. Normally this means taking legal action to sell the property and recover what the borrower owes under the mortgage.
The lender will attempt to recover the balance of the amount borrowed, unpaid interest and legal fees. If the lender does not recover the full amount owing to it, the mortgage insurer will pay the lender the amount of the shortfall, subject to any limits put in place by the insurer. The mortgage insurer may then take legal action to collect the shortfall from the borrower, if permitted under applicable law.
Who do Mortgage Brokers work for?
We only work for you. We are not affiliated with any one single bank or lender; thus allowing us to shop around for the best mortgage rates in Canada.
What is the purpose of a Mortgage Broker?
We specialize in mortgages and only deal with lenders who can compete against the local branches for better rates, terms and service. Our only job is to find our clients the absolute best mortgage product to fit their needs.
How do Mortgage Brokers get paid?
Directly from the lender we place your mortgage with.
Are there any extra costs or hidden fees when I use a mortgage broker?
There are absolutely no hidden fees. Any costs related to your mortgage are fully disclosed. Any costs incurred would be the same as if you went through a bank and in most cases LESS with Mortgage Brokers. We are here to earn your business today and in the future!
What if I have had poor credit or have been discharged from bankruptcy within the last 3 years? Can I apply for a mortgage?
Yes you can! Most conventional banking institutions put restrictions on who they lend money to for a mortgage, but we have the resources to shop for financing regardless of any credit situation. In regards to a bankruptcy, a larger downpayment may be required. Or maybe you are not ready to buy yet. Give us a call and find out what steps you should be taking to reach your goal of home ownership.