It is best in our current market place to get pre-approval for amortgage. You can go to your bank and speak to them about your optionsor you can also contact a mobile mortgage specialist who will help youwith all of your needs. I have a few different specialists that I canrecommend who will help you get the highest mortgage possible but withpayments that you are comfortable with.
Mortgage Types/Options
It is best to speak with a professional in the mortgage industry, butsome options for younger buyers are: 40 year mortgages, 35 yearmortgages, 0% down, etc. But don’t let 0% down fool you as you willneed some money up front for your deposit (this goes to the seller ofthe house but the bank should reimburse this money if you have a 100%mortgage-0% down) so you will need to have a line of credit that isready to go.
Ever hear of a 5% Down Payment?
The following is an excerpt from the Canada Mortgage and HousingCorporation website under the topic of "Mortgage Loan Insurance":
Get into your home sooner. Mortgage Loan Insurance helps you do it. Put as little as 5% down.
Whenyou need a mortgage loan that is more than 75% of the purchase price ofyour home, mortgage loan insurance is required. It protects the lenderand, by law, most Canadian lending institutions require it.
Havingmortgage loan insurance means that if you, the borrower; default onyour mortgage, the lender is paid back by the insurer - CMHC or aprivate company. With the risk of losing their money removed, lendershave the confidence to make mortgage loans of up to 95% of the purchaseprice of the home (subject to price ceilings).
Thatmeans your down payment can be as little as 5% of the house price. Withmortgage loan insurance, many Canadians who might be unable to obtain a25% down payment can still buy a home.
What does mortgage loan insurance cost?
There are two components: an application fee and an insurance premium.The application fee typically ranges from $75.00 to $235.00 andmortgage loan insurance premiums range from 0.5%-3.75% of the amount ofyour loan (additional charges may apply), depending on the size of theloan and the value of your home. The premium can be added to yourmortgage loan and paid off as part of your regular mortgage payments,or paid off in a lump sum at the time of purchase to save interestcharges on the premium itself.
Where can you apply for mortgage loan insurance?
See your lender, who can obtain mortgage loan insurance from CMHC or a private insurer.
CMHC will insure mortgages of up to 95% of the home's purchase price orthe market value of the property, whichever is less. (Restrictions mayapply. Contact your local lender.)
Both new and resale homes are eligible. Here are some of the criteria that must be met:
The home must be in Canada and must be your principal residence.Housing payments, including principal, interest, property taxes,heating (P.I.T.H.), the annual site lease in the case of leaseholdtenure and 50% of applicable condominium fees, can't be more than 32%of your gross household income (GDS ratio).
Yourtotal debt load can't be more than 40% of your gross household income(TDS ratio). Other criteria apply and are subject to change. Fordetails, please contact CMHC or your local lender.
Home