Do not accept the first mortgage loan presented to you at any rate or with any obscure clauses. The mortgage business is complex. Find THE best mortgage loan for you.
|Average posted mortgage rate||Best mortgage AVERAGE (preferential)|
Updated: October 2018
Mortgage experts have identified the most common mistakes people make again and again. Choosing the wrong options when you take out or renew your mortgage can lead to excessive fees that you will have to face by lowering your standard of living.
Here are some tips from experienced mortgage brokers
All real estate brokers agree: whether it’s buying your first home, or you’re a seasoned buyer, or a homeowner, when renewing your mortgage, you can avoid mistakes by being well-informed and taking into account the advice of knowledgeable brokers.
Several internet sites such as Best Mortgage Quotes are full of valuable information about this topic. You can also receive recommendations from mortgage broker partners of our digital by simply completing the form on this page.
Obtaining relevant information about mortgage loans offered in the market does not commit you to anything. The goal is to understand the mortgage product that best suits your financial situation and to know the exact pros and cons of each one.
To find a mortgage loan with a mortgage rate that is commensurate with your paying capacity, evaluate your finances without delay!
Did you know that there is a simple method to determine how much you can afford to pay monthly for your home while maintaining your standard of living? Mortgage brokers generally use what is called the ABD to establish the gross amortization of your debt.
It is important to keep in mind that buying a property generates additional costs on top of the purchase price such as property transfer tax (welcome tax), administrative and notarial costs, moving expenses and… a reserve amount allocated for the unexpected.
Further, even if you have a sizable down payment, it does not mean that your credit rating is adequate. What about your borrowing capacity?
To determine clearly what your needs are, contact a mortgage broker. He can help you to calculate the amount that you can afford for your mortgage, taking into account various factors such as your gross annual income and additional income, if any, the total amount of your debts, expenses related to your current home…
Now you know the amount that you can allocate for your mortgage payments based on your finances. Before you start looking for a new house, ask your broker to help you obtain a mortgage pre-approval from a private lender or a financial institution.
Thus, you will know exactly your capacity to purchase a property, particularly the price range that you should consider for your future home. Your pre-approval will give you a clear advantage over other buyers who have made an offer on the house that you want.
Free and without any commitment, a mortgage pre-approval does not guarantee that you will be granted a loan, according to the Canada Mortgage and Housing Corporation.
A professional mortgage broker will not only assess your borrowing capacity at current (relatively low) rates but will also plan a budget that takes into account possible fluctuations.
By following a budget that presumes that mortgage interest rates can increase, your mortgage broker will save you from being in a precarious situation that prevents you from being able to pay your mortgage.
Your mortgage planning must also take into account the cost of repairs to your property, maintenance and renovations in the medium or long term, the future expansion of the family, and future educational expenses.
Do not choose a mortgage based only on the mortgage rate. Even the lowest mortgage rate can cause problems and regrets later on.
« If you make a choice based on the rate only, the product may not be suitable for you », says Joe Walsh, mortgage broker.
Mortgage experts strongly recommend that you consider the contract terms and conditions (clauses) such as prepayment options, and penalty fees in the event that you want to pay your loan earlier.
If you want to find a mortgage that suits you, take the time to study the clauses in the contract. It is possible for you to request the lender or financial institution to guarantee the interest rate in writing and to include the period for which the rate is locked-in.
It is time to renew your mortgage. The idea of taking out another term with your financial institution without looking for other options is tempting.
The mortgage rate for your loan directly affects your monthly mortgage payment and therefore, the total amount you pay for your house.
Take, for example, a loan of $200,000 payable in 20 years. A new mortgage with an interest rate a quarter of a point higher (0.25 %) than you current rate would amount to an increase of $4,000 (over 5 years) in interest.
Mortgage rates are not cast in stone. Don’t hesitate to negotiate your interest rate down.
Before meeting with your lender, do your research online to compare products and mortgage rates offered by competitors.
By shopping for mortgage rates with other lenders, you will receive diverse offers. You can let your lender know what good offers you receive from other institutions.
You can discuss possibilities to reduce significantly your mortgage payments.
Another option is to request a mortgage broker to negotiate your mortgage rate to your benefit among lenders in his network yo find the best mortgage for you.
Each institution, knowing that your mortgage broker works with many other lenders in his vast network, will offer the most advantageous mortgage products. You will, therefore, benefit from this healthy competition generated as a result.
|Multi-Mortgage Loans||Mortgage brokerage|
|Planiprêt Hypothéques||Mortgage brokerage|
|Centre hypothécaire Dominion||Mortgage brokerage|
|TrueNorth Mortgage (TNM)||Mortgage brokerage|
|Vantage Realty Group||Mortgage brokerage|
|Intelligence Hypothécaire||Mortgage brokerage|
|Pro immobilier et hypothèque inc.||Mortgage brokerage|
|Royal Bank of Canada (RBC)||Bank|
|Toronto Dominion (TD)||Bank|
|Laurentian Bank of Canada||Bank|
This list was arranged in no specific order and is not complete. Private lenders can also be considered.
It is possible that some details you deem unimportant may cost you money in the future. It is for this reason that it is advisable to carefully analyze all aspects of a mortgage before making your choice.
For example, the interest rates do not vary based on lender alone. The gap between mortgage rates can also be due to :
A mortgage broker could help analyze all the relevant elements for more clarity.
The amortization period of your mortgage
The amortization is the spread of your payment over time according to the expected duration of its use. Since 2012, the maximum spread is not more than 25 years. This is the most common amortization period.
You can also pay for your mortgage in 20, 15, and even 5 years if you can afford it.
Certainly, if you pay the total amount of your loan in 10 years, your monthly payments will be higher than if you choose an amortization period of 25 years. However, by paying less on the interest of your mortgage, the total amount paid for your property will be reduced by thousands of dollars.
In summary, the longer you pay for your mortgage, the more expensive it becomes due to interest charges on your loan.
The term of your mortgage or the term of your contract
The term is the duration of the mortgage contract that you have agreed upon with your lender or financial institution.
The period during which you agree to pay your loan according to the terms and conditions may vary from 6 months to 25 years but generally spread out from 2 to 5 years.
At the end of the term, if the amortization period has not expired, you can negotiate a new term: the amount and frequency of monthly payments, mortgage interest rate, etc.
If mortgage rates are low when the time comes to negotiate your contract, it is advisable to negotiate a longer term.
The types of mortgage rates associated with your loan
The mortgage interest that you will pay is calculated based on the amount of your mortgage (directly proportional to the purchase price) and expressed as a percentage.
Variable mortgage interest rates follow market rates. They are, therefore, unstable, resulting in an increase or decrease in your monthly payments.
It is better to analyze whether your paying capacity and tolerance of risk can withstand such uncertainty.
On the other hand, although a variable rate carries more risks, it allows you to save on interest every time the rate decreases.
A fixed mortgage interest is guaranteed for the duration of your term.
Regardless of changes in the financial market, your lender or financial institution cannot change your mortgage rate and neither can you.
You can plan your budget and minimize risks.
On the other hand, a fixed mortgage rate is potentially more risky for your lender. It is, therefore, generally higher than a variable mortgage rate.
The information above will help you to understand the importance of finding the best mortgage loan for you and compare the interest rates online.
There are other decisions that you need to make (or requirements that you can claim) when planning your mortgage contract:
Feel free to consult a mortgage professional. The mortgage broker partners of Best Mortgage Quotes are reliable and 100% verified. They will put their experience and expertise at your disposal to help you find the best mortgage rate based on your needs.
To take advantage of this free service, all you need to do is fill out the free online request form on this page. Your mortgage broker will compare offers from over 20 financial institutions, quickly and without any obligation on your part.
The mortgage brokers who are part of this digital platform for price comparison and free online mortgage quotes have only one goal: to work with you to find the best mortgage loan.
Knowledgeable in preparing your file, a mortgage broker will apply for a mortgage from lending institutions on your behalf, without mentioning your name, and will not affect your credit in case you are refused.
Your broker can get a preferential rate for you given the large volume of loans he generates for financial institutions in his network. Not being loyal to any particular lender, your mortgage broker will send your profile to lenders that meet your criteria and offer the best interest rate and conditions (clauses) that are tailored to your needs.
In short, your mortgage broker
Find your mortgage broker without delay and take advantage of the best mortgage rate.
Comparing various mortgage offers from banks is the most effective method for saving money. Best Mortgage Quotes allows you to receive quotes from up to 20 financial institutions, free of charge, in just one request, due to the help of our mortgage broker partners in your area.
Selected using strict criteria, you are sure to receive a quote only from a certified and experienced mortgage broker. You don’t need to search randomly online.
All you need to do is compare with a mortgage broker the offers you receive, free and without obligation.