BUYING A HOME - ARRANGING YOUR MORTGAGE

 

BUYING A HOME USUALLY MEANS TAKING OUT A MORTGAGE.

 

THAT MEANS YOU BORROW MONEY TO BUY A HOME, USING THAT HOME AS COLLATERAL FOR THE LOAN.

 

MAKE SURE YOU HAVE A MORTGAGE YOU CAN LIVE WITH.  THERE ARE LOTS OF OPTIONS AVAILABLE THAT LET YOU CUSTOMIZE YOUR MORTGAGE TO SUIT YOUR FINANCIAL GOALS AND NEEDS.

 

MORTGAGE BASICS

MORTGAGE PAYMENTS ARE MADE UP OF A PRINCIPAL SUM (THE AMOUNT BORROWED) AND INTEREST (THE COST TO YOU OF BORROWING MONEY).

THE BEST PLAN FOR ANY TYPE OF MORTGAGE IS TO MINIMIZE THE AMOUNT OF INTEREST YOU PAY - AND LENDERS OFFER SEVERAL WAYS TO HELP DO THIS:

  • A LARGER DOWN PAYMENT MEANS YOUR HOME ULTIMATELY COSTS LESS BECAUSE A SMALLER MORTGAGE MEANS LESS INTEREST.
  • A SHORTER AMORTIZATION, THE PERIOD OVER WHICH A LOAN IS REPAID.
  • A WEEKLY OR BIWEEKLY PAYMENT SCHEDULE, INSTEAD OF MONTHLY.
  • ADDITIONAL LUMP SUM PAYMENTS.

 

YOU DON'T HAVE TO GET YOUR MORTGAGE FROM THE SAME PLACE YOU HAVE YOUR SAVINGS OR CHEQUING ACCOUNTS.  ALSO, AT THE END OF EACH TERM, YOU MAY BE ABLE TO CHANGE THE OPTIONS OF YOUR MORTGAGE, SUCH AS THE PAYMENT SCHEDULE, THE TERM, THE RATE, EVEN WHO HOLDS THE MORTGAGE.

 

MORTGAGE FEATURES

PREPAYMENT

ENSURE THAT YOU HAVE SOME FORM OF PREPAYMENT CLAUSE IN YOUR MORTGAGE THAT WILL ALLOW YOU TO PAY DOWN YOUR MORTGAGE WITH A LUMP SUM, OR AN EXTRA PAYMENT, WITHOUT PENALTY.

PORTABILITY

THIS MEANS YOU CAN TRANSFER THE TERMS AND CONDITIONS OF YOUR MORTGAGE TO YOUR NEXT HOME.  FOR EXAMPLE, THIS MAY ALLOW YOU TO KEEP A LOW INTEREST RATE IF YOU SELL ONE HOUSE AND BUY ANOTHER.

ASSUMABILITY

THIS MEANS YOU MAY BE ABLE TO ASSUME (TAKE OVER) THE EXISTING MORTGAGE ON THE PROPERTY.  IT MAY HAVE ATTRACTIVE FEATURES, SUCH AS A LOWER INTEREST RATE THAN THE PREVAILING MARKET.

IN TURN, AN ASSUMABLE MORTGAGE MAY BE A SELLING FEATURE FOR YOU WHEN YOU DECIDE TO MOVE ON IN THE HOUSING MARKET.

EXPANDABILITY

THIS LETS YOU EXPAND THE PRINCIPAL ON A FIRST MORTGAGE AT THE LENDER'S AGREED-UPON RATE OF INTEREST.  THIS CAN BE A COST-EFFECTIVE WAY TO FINANCE A HOME RENOVATION.

FEEL FREE TO EMAIL ME AT piech@c21today.net OR CALL ME DIRECT AT 289-213-5555 FOR YOUR FREE COPY OF CMHC'S HOME BUYING GUIDE !!!!!

Brenda Piech

Brenda Piech

Sales Representative
CENTURY 21 Today Realty Ltd., Brokerage*
Contact Me