The Beginner's Mortgage Guide

What is the difference between a Fixed Rate Mortgage and a Variable Rate Mortgage? With mortgages you pay a price for certainty. You generally pay more for a fixed rate mortgage because the lender is taking the risk as to what the rates will do by fixing the rate for you. You generally pay less for a variable rate mortgage because it is you that is taking the risk of uncertainty as to how interest rates will move - up or down. When you take out a fixed rate mortgage, your interest rate will never change throughout the term.YOUR lending institution will only advise you on their own product. You could visit every institution out there, one by one if you had time..

Should I go with a Fixed Rate or Variable Rate? The mortgage rate stays the same for the whole term and the mortgage payments are consistent during the term of the mortgage. The mortgage rate varies with fluctuations in the bank prime rate. As a result, mortgage payments may vary during the term of the mortgage. A minimum term commitment is often required (usually 3 years). You may have the option to "lock-in" the mortgage at a fixed rate during the term.It is very secure. Your private and personal information is not sent anywhere without your permission and all the information that you provide on-line is encrypted for the greatest possible security.No.

How secure is it to apply online? It is very secure. Your private and personal information is not sent anywhere without your permission and all the information that you provide on-line is encrypted for the greatest possible security.Be very careful! Some of the gimmicks used to entice you to take a mortgage at an institution may seem very appealing but the long term effect could be costly.

How does a mortgage broker get paid? MOST Financial Institutions pay a referral fee to the Broker for doing all the legwork and credit research for them ( the job of a loans officer). Since this service is valuable, a commission is paid and in these cases Home Mortgage Canada does not charge a fee. In some circumstances, a client's financial requirements, credit, or job situation is more complicated and in these cases fees payable to the Mortgage Broker and/or the Lender may be total costs for the same interest rate, loan amount, and loan program. Ask if the total costs include discount points, origination fee, title company fees, escrow company fees, and county recording fees. The lowest APR may not be the lowest total cost loan for your personal financial plans.

What are prepayment options? Many lenders allow you to make a limp sum payment, usually 15-20% of the original principal balance each year. In addition, many lenders also include a ?double up your payment option or allow you to increase your payment up to 15% each year of the term. Some even offer a Skip-a-Payment option that allows you to skip a payment if you are having a tough time getting by. Each lender is different so we will go over these options when you are making your mortgage choice.With mortgages you pay a price for certainty.

What can I do if I have a variable interest rate and interest rates start to increase? Most variable mortgages give you the right to convert to a fixed rate at any time. If you think the interest rise is not just a short-term fluctuation but will be a long-term trend then you may want to consider locking into a fixed rate. There is usually no charge for this but you should consult me to ensure that you are getting the best rate possible.soon as we get your application, we assign a dedicated Customer Services Associate to your case, backed up by a 'buddy' in case they are ill or away. This means you have a named contact and someone who is familiar with your case to call on. Customer Services Associate will follow your application through from start to finish and tackle any problems that arise on the way.YOUR lending institution will only advise you on their own product. You could visit every institution out there, one by one if you had time..

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