Know Before You Go: What to Do Before Buying a House in Ontario

Since the Canadian Mortgage and Housing Corporation guidelines changed in July, Ontario housing sales have dipped. If you are in the market and looking at buying a house in Ontario in the near future, this is good news for you. Since housing sales have dropped, so too will house prices. But what do you need to do before buying a house in Ontario or obtaining mortgage approval?

Firstly, before buying a home in Ontario, you need to figure out how much you are willing to pay and how much you can afford (sometimes these two numbers will not match)! Working with a Mississauga mortgage broker will help you calculate your monthly bills and using a mortgage affordability calculator will help you determine how much you can actually afford to spend on a monthly mortgage payment. Sometimes buying a house in Ontario at the top of your affordability price range may feel snug, so make sure you also figure out how much you are comfortable spending on a monthly basis. A Mississauga mortgage broker will also help you calculate your monthly carrying costs and all of those other monthly fees that come with buying a house in Ontario.

Securing a down payment on a house is also an important necessity. There is no point in going to seek approval for a mortgage if you do not have a down payment (or access to secure one). Your down payment, which needs to be at least 5% of the total value of the house, can come from various different sources, not just savings. Saving up the cash, receiving a gift from a family member, using investments, or obtaining a zero down payment mortgage are all options. First time home buyers can even use part of their RRSP’s. It is important to discuss these with your Mississauga mortgage broker prior to buying a house in Ontario.

Another important thing that your Mississauga mortgage broker will teach you before buying a house in Ontario is what to expect as far as closing costs. Closing costs are those costs that you are presented with on your closing date – and you need to be prepared for them. These costs typically include lawyer’s fees, home inspection costs, land transfer tax, insurance, and property tax adjustments. Many of these closing costs associated with buying a house in Ontario are mandatory, and so your Mississauga mortgage broker can tell you which ones you will need and how much to have on hand.

There are many things to think about before you actually go out and find that perfect house. Putting in an offer only to find out that you can’t really afford it is disappointing, and entering into a contract that makes you feel uncomfortable or ill prepared can have devastating impacts. Before buying a house in Ontario, speak to a Mississauga mortgage broker to find out all you need to know to make the best decision possible.

For more information about what to know before buying a house in Ontario, please contact Paul Mangion of The Mortgage Centre at 416-204-0156 or visit www.themortgagecentretoronto.com

Self-employed or on 100% commission: A Mississauga Mortgage Broker Can Help You Get the Best Mortgage Rates

Buying a home is an exciting time. Whether you are a first time home buyer, are moving up or down-sizing, buying an investment property or looking to refinance your home, getting a mortgage gives you the ability to search within your price range for the perfect property. However, if you are self-employed or on 100% commission, you may be finding it far more difficult to obtain mortgage financing compared to someone with a regular salaried income – unless you work with a Mississauga mortgage broker.

Statistics show that almost 20% of all Canadian income earners secure their primary source of income from either a personal business or from a job that pays based on commission. Even though this represents a substantial portion of the Canadian population, it remains clear that self-employed and 100% commission paid individuals have much more difficulty obtaining mortgage financing. Why is this and how can you get a mortgage if you are self-employed or on 100% commission?

Why is it so tough? Since most big banks provide mortgage approval based on your average monthly income, easily visible through past paystubs, those who run their own business or work on 100% commission know that the process is far more complex. Monthly income often varies from one month to the next, and a yearly income can often be hard to determine as far as how it differs from year to year. Another issue for big banks is that many self-employed business owners minus expenses in lieu of surplus income, which is something that banks often refuse to recognize, whereas a Mississauga mortgage broker may not.

When applying for a mortgage when self-employed or if you are working on 100% commission, lenders often want a great deal more income verification and information compared to those with traditional income sources. An outline of projected profits for the upcoming years is often considered far less guaranteed when compared to salary, regardless of how your business may have been performing over the last few years. Working on 100% commission poses the same problem, as even if your profit margins and sales have been strong, they are not necessarily guaranteed to stay that way.

So what can you do if you find yourself in this position? Working with a Mississauga mortgage broker rather than going through a big bank, often provides you with far more options if you are self-employed or on 100% commission and looking for mortgage approval. A Mississauga mortgage broker, one with access to a wide portfolio of lenders, can ensure that you are able to receive mortgage funding even if you are not a regular salaried employee. Working with both banks and private lenders, the right Mississauga mortgage broker will be able to obtain the best rates for your mortgage regardless of your employment situation.

If you are self-employed or on 100% commission and looking for a mortgage, find out how a Mississauga mortgage broker can help you by contacting Paul Mangion of The Mortgage Centre at 416-204-0156 or visit www.themortgagecentretoronto.com

Mississauga Mortgage Broker Finds the Low Interest Mortgage Financing Options over the Holidays

The holiday season is right around the corner and holiday shopping mania is about to begin. Whether you like to prepare for the holidays in advance or are a last minute shopper, holiday financial planning could mean the difference between a stress free new year and facing a landslide of credit card bills.

Homeowners have many options as it relates to holiday financial planning and now is a better time than ever to consider consolidating your debt. Your home is your best shot at securing low interest mortgage financing and there are currently many low interest mortgage financing options available in Ontario.

Low interest mortgage financing options could include a secured line of credit, a first mortgage refinance or a second mortgage, and the best option for you will depend on your personal financial circumstances and the type of debt you are looking to consolidate.

Those who don’t have a lot of debt ($15,000 or less) may be best suited for a line of credit. Lines of credit generally offer low interest rates and you only use what you need. A line of credit is considered a low interest mortgage financing option and gives you the flexibility of a low monthly payment with an option to pay as much as you want (when you have extra money). If you live in Mississauga, a Mississauga Mortgage Broker can help you to obtain a low interest line of credit that offers you the maximum benefits.

If you owe $16,000 - $25,000 in debt a second mortgage may be the best choice. Because second mortgages offer a fixed repayment, this low interest mortgage option will enable you to consolidate your debt and fix your monthly payment so that you know when you will be debt free. With second mortgages, you can set your amortization as low as 5 years which is essentially a 5 year consolidation loan. After you make your payments over 5 years, your debt is paid in full. A $25,000 mortgage financed on a 5 year amortization could bear a monthly payment as low as $500 per/month.

If you owe more than $25,000 in debt, refinancing your first mortgage is likely the best choice. Once you have accumulated a significant amount of debt, a second mortgage amortized over a short period of time may bear a monthly payment that is too much for your budget to take. Refinancing your first mortgage is an excellent low interest mortgage financing option that will create immediate cash flow and put an end to multiple payments to various credit cards.

All of these low interest mortgage financing options will enable you to consolidate your debt, will reduce your payments to one single monthly payment and allow you to start the New Year off without the usual landslide of credit card bills come January. Homeowners in Mississauga should consider speaking to a local Mississauga Mortgage Broker for the lowest interest mortgage financing options that are available locally. For more information about low interest mortgage financing options from Mississauga Mortgage Broker Paul Mangion, call 416 204 0156 or visit www.gtamortgagematters.com