Pre-Approved Mortgage
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A Pre-Approved mortgage is a Free
and No-Obligation deal that lets you know before you go looking
for your home or signing an offer to purchase, how much you
can afford to borrow based on your qualification and personal
credit rating. We'll arrange for you the most competitive rates
with longest rate guarantee period that goes up to 120 days
- if rates go higher, your rate will not be affected, and if
rates go lower, you get the lower rate. This protection is solely
responsible for savings thousands of dollars for many people
who obtained a pre-approval and the rates increased afterwards. |
Conventional Mortgage
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A conventional mortgage is a loan that does not exceed
75% of the purchase price or appraised value of the home,
whichever is less. This type of mortgage does not have to
be insured against default. |
High-Ratio Mortgage
- CMHC Insured / GE Capital Insured
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A high-ratio mortgage is a loan that is above
75% and up to 95% of the purchase price or appraised value of
the home, whichever is less. These mortgages must me insured
against loss by either Canada Mortgage and Housing Corporation
(CMHC), a Federal Government Corporation, or GE Capital, a private
insurer. The premiums can be added to the mortgage amount or
paid at closing, and are as follows:
| For Mortgages Up To: |
75%
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No Insurance Required |
| For Mortgages From: |
75.1-80% |
Premium is 1.00% |
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80.1-85%
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Premium is 1.75% |
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85.1-90% |
Premium is 2.00% |
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90.1-95% |
Premium is 3.25% |
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First Mortgages:
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A First mortgage is the first debt registered against a property
that is secured by a first "charge" on the property.
If a default on the mortgage occurs, the first lender has first
right on the property to recover the outstanding principal and
interest costs, and any other costs incurred during the process.
Second Mortgages: A second mortgage is a debt registered after
a first mortgage has been registered. In most cases, the interest
charged on the second is higher than the first, reflecting the
higher risk to the lender, but over a short term, still more
cost effective than paying the high cost of the CMHC/GE Capital
insurance premium. They can be used to finance up to 90% of
the purchase price or value of the home. |
Open Mortgages
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An open mortgage allows you the flexibility to repay the mortgage
at any time without penalty. Open mortgages are available in
shorter terms, 6 months or 1 year only, and the interest rate
is higher than closed mortgages as much as 1%, or more. They
are normally chosen if you are thinking of selling your home,
or if you are expecting to pay off the whole mortgage from the
sale of a another property, or an inheritance (that would be
nice). |
Closed Mortgages
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A closed mortgage offers the security of fixed payments for
terms from 6 months to 10 years. |
Fixed-Term Mortgages
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With a fixed-rate mortgage, the interest rate is set for the
term of the mortgage so that the monthly payment of principal
and interest remains the same throughout the term. Regardless
of whether rates move up or down, you know exactly how much
your payments will be and this simplifies your personal budgeting. |
The Adjustable Rate
Mortgage (A.R.M.)
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The Adjustable Rate Mortgage (A.R.M.) provides a lot of flexibility,
especially when interest rates are on their way down. The rate
is based on prime minus 0.375% and can be adjusted monthly to
reflect current rates, and for the first 3 months of the mortgage,
a large discount on the rate is given as a welcoming offer. |
Secured Lines of Credit
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Use the equity in your home that you have built up to purchase
investments (where interest costs would be deductible against
the earned income), finance home renovations, buy a car, or
any other reasonable needs, with rates as low as prime. |
Equity Mortgages
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These are mortgages that are assessed on the equity of the
home (market value minus the mortgage amount). They can be as
high as 75% of the purchase price or value of the property |
Multiple Term Mortgages
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If you wanted the lower rates of a short term mortgage but
wanted the security of a long term, why not choose both. Yes,
"build your own mortgage" product. You can split your
mortgage in to as many as 5 parts, all having different terms,
rates, and amortizations, but one total monthly payment. This
way, you are spreading the risk. But, be prepared to be "hands-on"
and watch the market very carefully here. |
The 6 Month Convertible
Mortgage
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When rates are on their way down, or you may feel that they
will in the near future, a 6 month convertible mortgage offers
you the short term commitment at fixed payments, with an added
advantage that while within the term, the mortgage is fully
convertible to a longer term from 1 year to 10 years. At the
end of the 6 month period, the mortgage becomes fully open,
where one can renew with the existing lender or transfer to
another lender. |
All-Inclusive-Mortgage
(A.I.M.)
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The AIM mortgage takes care of everything automatically. For
Purchases, it includes: Solicitor's legal fees and standard
disbursements to close the purchase and mortgage; Title transfer;
Title Insurance from LandCanada for the clients; CMHC application
fee or Appraisal fee; 1% Cash-Back to cover Land Transfer Tax;
Registration of Deed and Mortgage. For Refinances, it includes:
Legal fees and standard disbursements to prepare and close the
mortgage; Title Insurance from LandCanada; CMHC application
fee or appraisal fee; 1% Cash-Back; Registration of new first
mortgage; Registration of discharge of existing first and second
mortgage. The minimum term available is a 5 year term. |
Bridge Financing
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Bridge financing refers to a special, short-term loan needed
to cover the time gap when two properties, both firm sales,
are involved and the closing dates don't match. The property
being purchased closes before the one that was sold. There is
a small set-up fee charged by the lender to have the bridge
loan arranged, plus the cost of the interest as now you are
carrying both properties for a short time. |
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