Mortgages

A mortgage is a loan from a bank or lender that allows you to purchase property without having to save for the full amount. The home you purchase becomes the collateral against which the loan is secured.

In order to qualify for a mortgage, you will have to provide a snapshot of your financial health to the mortgage provider. Your bank or lender will require you to provide:

• Your Credit Score: This is a report of your borrowing and payment behaviour.
• Your Employment History: Proof of your salary or hourly pay rate, your position, and employment stability.
• Your Debt to Income Ratio: Your DTI is the amount you owe relative to your income. This will include recurring costs such as housing and other loan payments.
• Your Down Payment: How much you have saved for a down payment will influence the amount you can qualify for.

Providing this documentation will allow you to figure out exactly how much of a mortgage you will qualify for.

Securing a mortgage is not always so simple or straightforward. Rates, terms, and levels of service will vary from provider to provider. Don’t assume that the first lender’s mortgage is pretty much the same as the mortgage you would get from another. There are some things you need to do to avoid costly mistakes and find the mortgage product that is right for you.

Mistake #1: Not Getting Pre-Approved

It is hard to resist scrolling through the online listings in search of your dream property, but before you begin your home search in earnest you need to have a very clear idea of what you can afford. And keep in mind that the maximum you are approved for does not reflect every aspect of affordability. Don’t forget to factor in administrative and legal fees, taxes, condo or homeowner association fees, and your own goals for finances and lifestyle.

Mistake #2: Not Shopping Around

Not all lenders are created equal. Nor are all mortgages. There are many mortgage products out there that are designed to meet the needs of certain segments of the population; first-time buyers, investors, and the self-employed just to name a few. Not every mortgage is right for every borrower. One easy tip to help you navigate the complicated landscape of mortgage financing is to partner with a reputable and experienced broker who can cut through the flashy ads and empty promises and help you find the best mortgage solution for you.

Mistake #3: Using All Of Your Savings For A Down Payment

A large down payment is often favoured. And it really is smart to ensure that you have saved the most you can by the time you start looking for your home. But don’t leave yourself strapped when it comes time to finalize your home purchase because you have forgotten to set aside money for closing costs. These fees can often add up to 4% or even more of your home’s purchase price. Savvy advisors recommend that you also set aside three to six months of living expenses in case of emergency so you never have to put your mortgage and your investment on the line.

There are mortgage products available for first-time buyers, investors, empty nesters, growing families, newcomers, the self-employed, and even those with less than perfect credit.  The key to a healthy financial future is finding the mortgage that is right for you. Partner with Property Finance Corp. and leverage our network of over 35 lenders and the skill and experience of our knowledgeable brokers as you explore all the mortgage options out there. Let us guide you with thoughtful discussions about your financial health and goals for the future and let us take you home. Call 1-844-PF1CORP (731-2677).