It is best in our current market place to get pre - approval for a mortgage. You can go to your bank and speak to them about your options or you can also contact a mobile mortgage specialist who will help you with all of your needs. I have a few different specialists that I can recommend who will help you get the highest mortgage possible but with payments that you are comfortable with.
Change of mortgage rules
1. The maximum amortization period for insured mortgages with loan-to-value ratios of more than 80% have been reduced from 35 years to 30 years.
2. Federal rules have reduced the maximum amount that can be borrowed in refinancing their mortgages, from 90% to 85%.
3. Lastly, government insurance backing on home equity lines of credit (HELOCs) is no longer available.
When you need a mortgage loan that is more than 75% of the purchase price of your home, mortgage loan insurance is required. It protects the lender and, by law, most Canadian lending institutions require it.
Having mortgage loan insurance means that if you, the borrower; default on your mortgage, the lender is paid back by the insurer - CMHC or a private company.
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 and mortgage loan insurance premiums range from 0.5%-3.75% of the amount of your loan (additional charges may apply), depending on the size of the loan and the value of your home. The premium can be added to your mortgage 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 interest charges on the premium itself. Consult with your lender for an update on the latest fees.
Where can you apply for mortgage loan insurance?
See your lender, who can obtain mortgage loan insurance from CMHC or a private insurer.
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 leasehold tenure and 50% of applicable condominium fees, can't be more than 32%of your gross household income (GDS ratio).
Your total debt load can't be more than 40% of your gross household income(TDS ratio). Other criteria apply and are subject to change. For details, please contact CMHC or your local lender.
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