Mortgage Rates, Types, Terms, Credit Reporting

Rate: When choosing a mortgage, rate is certainly very important.  However, rate can't be the only factor if a mortgage is to be part of a sound financial future.  There are many things to consider.

Term: The term of the mortgage means the number of years until it renews. If you are considering a move to another property, then you may wish to choose a shorter term or at the very least make sure the mortgage is portable to save paying a penalty. If you need rate stability, you may want to consider 7 or 10 year terms.  That way the rate will be constant for a longer period, making it easier to budget.

Type: The type of mortgage can be one of the most important factors to determine.  Those who have a large down payment, or equity can choose a variable rate mortgage and feel comfortable with the decision.  Those who are buying a first home or would find fluctuations in payments to be disconcerting may wish to rely  on a fixed rate mortgage. In conjunction with the advise of your mortgage advisor the right option will save stress and worry while offering excellent value.

Amortization: The Amortization is key to managing a mortgage.  The higher the Amortization, the lower the payment.  If you just want a lower payment then the 35 year Amortization is an option.  If you wish to save interest over the life of the mortgage, then a shorter Amortization is a better option.  I recommend registering a mortgage with a longer Amortization and increasing the payment.  If your situation changes and you need to reduce the payment, you won't be required to discharge the mortgage and possibly incur a penalty.  You can simply ask to go back to the lower payment.

Pre-payment: Pre-payment options are important in the sense that you can greatly reduce the number of years required to pay off your mortgage.   If you are in a situation that allows you to make payments greater than the regular payment then all the extra money goes to the principal, thereby saving thousand in interest.  Most mortgages allow from 10% to 25% as a pre-payment

Tranfer/Assume: Mortgages that can be transferred or assumed should be considered.  If you move before the end of the term, you will have the option of either moving the mortgage to another property or even having the new buyer take over your existing mortgage.  In any event, both choices will save the cost of a penalty.

Fees: If you are using a Mortgage Brokerage for the first time, you may not know that most borrowers will never be charged a fee for their service.  Mortgage Agents are paid by the Lenders.  There are situations that will require a fee, but they are usually associated with situations of credit issues or possible the type of property that is being financed.  You will be made aware that a cost is involved before being asked to complete your transaction. weekly e-rates

If you live in Toronto, Greater Toronto Area, Durham Region, Pickering, Ajax, Whitby, Oshawa, Port Perry, Bowmanville, Newcastle or Uxbridge, you've come to the right place!