For most people, the largest purchase in their lifetime is the purchase of their home. Dominion Lending Centres Forest City Funding can help you achieve your goals. We want to make sure every client is aware of the many mortgage options available to them. Financial institutions are regularly launching new products and programs such as interest-only loans, self-employment, rental property, and vacation property programs. Through these options, home ownership has become a reality for many. Whether you are a first-time home buyer, looking to refinance, or interested in investing in properties, we have the experience to help you. We have access to the very best products and rates available. Give us a call... we think you'll be pleasantly surprised!
Getting a Mortgage Pre-Approval
If you are looking for a new home, be sure you are pre-approved. This will guarantee your rate for a period of time, usually 120 days. If interest rates drop during this time, your locked-in rate will drop as well. However, if the interest rates go up, your locked-in interest rate will not. With your financing secured, you will shop for your home with confidence, and be protected from negative rate changes. In addition, you will have an advantage against other home buyers during the negotiation process.
To get pre-approved, you will need to provide basic information to your mortgage professional which allows them to determine your buying power. We will review all the costs involved with owning a home with you and recommend the right mortgage product. We will advise you on what you can afford, and what your payments on a specific mortgage will be.
Understanding your Credit Report
In Canada, the two main credit reporting agencies are Trans Union and Equifax. These agencies are tasked with tracking individual credit histories through a detailed report of a person's financial activities, resulting in a credit score. Mortgage lenders assess a person's lending risk through their credit score (or beacon score) which can range from 300 to 900. The higher your credit score, the better. The mortgage product and interest rates that you qualify for will be affected by your credit score.
"What about my credit score, what if it's too low"
You have the right to obtain a copy of your credit report, and our mortgage professionals can help you do that. Furthermore, we can review it with you, help you understand it, and verify that all of the information is correct. The good news is that your credit report is a working document. This means that you have the ability, over time, to repair damaged credit and increase your score.
Fixed Rate vs. Variable Rate
It is not always easy to decide between a fixed or variable rate. Clients need to consider factors such as tolerance for risk and the ability to withstand increases in mortgage payments. For example, a variable rate may result in savings, by allowing borrowers to take advantage of lower rates. However, clients who want stability in their payments, or are more conservative may prefer a fixed rate mortgage. As a consumer, it is best to have a candid discussion with your mortgage professional to ensure you have a full understanding of the risks and rewards of each mortgage type.
Determine the Right Term when purchasing a home
Even the savviest of homebuyers can find it challenging to choose the mortgage term that is best. However it is important homebuyers make the right decision about which product to choose in order to maximize their savings. Clients can choose a longer mortgage and ensure that they will be able to afford payments, should the interest rates increase. Alternatively, they may choose to pay their mortgage sooner. For example, if you are shopping for an investment property, you will likely want to consider choosing a longer mortgage term to allow you to more accurately project your future income and expenses from the property. In addition to considering the financial markets and your personal circumstances, it is important to pay attention to the conditions of the mortgage and how much flexibility they provide if your situation changes.
Pay Off Your Mortgage Faster
The amortization terms for most mortgages in Canada are generally between 25 and 35 years, however, it doesn’t have to take that long. You can pay off your mortgage sooner by taking these steps:
- Make mortgage payments weekly or bi-weekly, instead of monthly.
- Increase your mortgage payments when your income increases.
- Make extra payments on your mortgage balance each year. Apply bonus/leftover money to your mortgage as a lump-sum payment and watch the results.
By applying these strategies consistently over time, you will save money, pay less interest and pay off your mortgage years sooner!
Self-Employed Solutions when purchasing a home
Canadians who are self-employed can face challenges in obtaining personal financing. This is because business owners can find it difficult to prove self-employment income, and income stability to lenders.
We are experts at assisting self-employed clients with getting a mortgage or refinancing their current mortgage. Our expertise will ensure you get the best rate available!
You will be excited to learn that the mortgage products available today are structured to help you succeed!
If you have any questions or require more guidance please contact our office anytime. Our advice is free!