Canadian Mortgage News - CMHC Mortgage Amortization Changes and How They Will Impact You

The second half of this year has been big for Canadian mortgage news. In July, the Canadian Mortgage and Housing Corporation (CMHC) amended its guidelines and mortgage amortization rules in an effort to try and decrease the debts of current and future homeowners in Canada. These guideline changes have had some significant impacts, particularly for those individuals seeking mortgages of over 80% financing.

The most significant change is with regards to the mortgage amortization period. Any mortgage contract prior to July 9^th provided the option to choose a 30 year amortization period. After July 9^th though, this mortgage amortization period has changed from 30 to 25 years. This will, on average, increase monthly mortgage payments by about 12%.

There are some pros and cons depending on your current financial situation that accompany these mortgage amortization period changes, especially for first time home buyers. Firstly, these changes make it a bit tougher to get approved for a mortgage.  Since one of the goals of these changes overall is to ensure that the individual seeking the mortgage is better prepared for home ownership, a shorter mortgage amortization period may affect your approval. When a lender assesses an individual’s ability to financially manage a mortgage, they usually calculate the maximum amount that is financially manageable. Since a shorter mortgage amortization period increases the monthly mortgage payment, this may negatively impact your ability to receive approval for a mortgage.

At the same time, if a small increase puts you over the threshold of affordability, perhaps it is time to rethink the amount that is being sought.

On the flipside, the positive aspects relate to the decreased interest that you will pay thanks to a shorter mortgage amortization period. Knocking 5 years off of your mortgage term can save you significant interest in the long run, and leave you mortgage free 5 years sooner.

Another result of the CMHC guideline changes impact mortgage refinancing. Mortgage refinancing, originally maxed at 85% of the value of the home, has been reduced to 80%. This change, like the altered mortgage amortization period, is meant to promote saving through home equity and to decrease the debt load for current homeowners.

Since these changes are due largely in part to the high amount of debt being carried by average Canadians, it is no surprise that yet another change to CMHC guidelines is in respect to individual gross debt service ratio. Gross debt service ratio, which refers to all of your property-related costs (mortgage payments, property taxes, heating, condo fees, etc.), must not exceed 39% of your total income. This has been decreased from 44%.

Another CMHC change aside from a shortened mortgage amortization period, lower mortgage refinancing, and a lower gross debt service ratio, includes the banning of government-backed mortgage insurance on those properties costing over $1 million – although this is less of an impact for most of the population that the other changes.

For more Canadian mortgage news or to find out more about CMHC guideline changes including a shorted mortgage amortization period, please contact Paul Mangion of The Mortgage Centre at 416-204-0156 or visit www.themortgagecentretoronto.com

Ontario Mortgage Rates - Part 5 --- What is a fixed mortgage rate?

In Ontario, a fixed mortgage rate is a mortgage where the interest rate stays the same for the term of the mortgage loan.

A fixed rate mortgage is a safe option because you know that your mortgage payment will not change during the term of the mortgage. Families who live on a tight budget are better suited to a fixed term mortgage as it ensures that there are no surprises.

A fixed rate mortgage usually bears a slightly higher interest rate then a variable rate mortgage. The interest rate is fixed based on the term of the mortgage so the shorter the term, the lower the interest rate.

Banks and other major financial institutions generally want customers to lock into a 5 year fixed rate mortgage because it yields them the most interest and it is locked in, so they know that the customer is theirs for at least 5 years.

Now as I mentioned, it all depends on you, your budget and your lifestyle. If you are living on a tight budget, don’t plan on moving for the next 5 years and want to guarantee your mortgage and interest rate, a fixed rate mortgage is right for you.

On the other hand if you have lots of surplus cash flow in your budget, low debt and want to pay off your home fast, opt for a variable rate mortgage which generally carries a lower interest but also comes with the risk that if mortgage rates go up, yours will too!

Whether you chose a fixed rate mortgage or a variable rate mortgage, if you want to pay off your mortgage quickly, outside of choosing the type of interest, you can also do other things to speed up the process of paying down your mortgage.

You don’t have to choose a 30 year amortization. Did you know that reducing your mortgage amortization by 5 years will only increase your mortgage payment slightly but will save you 10‘s of thousands in interest?

Also consider accelerated mortgage payments as another way to pay more to your mortgage principal.

When planning for a mortgage, always consider the benefits and risks to the mortgage products you are considering so that you make the most informed choice. It's not always about the lowest Ontario mortgage rates. It's also important that you commit to a mortgage you can afford to repay, at terms you can live with. For more information about fixed rate mortgages please visit http://www.gtamortgagematters.com/

Ontario Mortgage Rates - Part 4 --- How to Get Approved for a Mortgage at the Lowest Mortgage Interest Rate

If you are looking to purchase a home you must be thinking about how to get approved for a mortgage at the lowest possible mortgage interest rate. Different lending institutions offer different mortgage interest rates to applicants based on the risk that they represent as a potential client.

Usually financial institutions that offer CMHC mortgage insurance offer the lowest interest rates. That is because if your mortgage is CMHC insured and you default, CMHC will pay the bank for any shortfall. That’s not to say that CMHC won’t try to collect the money back from you in the future.

This means that if you want to get approved for a CMHC insured low interest mortgage you will have to satisfy CMHC’s requirements as well as the banks. Both CMHC and the bank have common criteria.

1. You must be able to prove your income.

2. You must demonstrate stability.

3. Your income to debt service ratios must be in line.

4. You must have the minimum required down payment.

5. You must meet their credit score requirements.

Generally a financial institution will want to see that you have had the same income source for the past 3 years. They will sometimes request your tax assessments as evidence. If you are employed they may ask for a job letter and paystub.

Your debt service ratios consist of two numbers, your GDS and TDS. Your TDS is your “total debt service ratio” This is the amount of your monthly income that is consumed by your housing payments and payments to debt divided into your gross monthly income expressed as a percentage. CMHC and most lenders will require that your TDS does not exceed 42% (with your new mortgage).

Your GDS is your “gross debt service ratio” which is the amount of your monthly income that is consumed by your housing payments alone, against your gross monthly income, expressed as a percentage. CMHC and most lenders will require that your GDS does not exceed 32% (with your new mortgage).

You must be able to prove that you have the required down payment or if you are refinancing, that you have the sufficient equity.

Finally, the minimum credit score required to be approved for a mortgage at a bank is 680. Set that as your benchmark if you want to get approved for Ontario’s lowest mortgage interest rate. For more information about how to get approved for a mortgage at the lowest mortgage interest rate please visit http://www.gtamortgagematters.com/

Ontario Mortgage Rates - Part 3 --- When are mortgage rates going up?

When are mortgage rates going up? This seems to be the question on everyone’s mind, especially those with variable rate mortgages.

Ontario mortgage rates change depending on the state of the economy. Interest rates can be affected by the local, national and global economies. The Bank of Canada sets the lending rates for Canada and then financial institutions calculate their interest rates based on that.

When unemployment rates are high and the economy is struggling interest rates will be lower. When the economy is stable and growing Ontario mortgage interest rates will go up.

There have been reports that the economy in Canada has been improving, however we still have a huge manufacturing sector. So as our dollar increases, the currency exchange rates make manufacturing products here less affordable.

When you boil it down, a stronger Canadian Dollar is a bad thing for Canada’s manufacturing sector. Add to it other financial turmoil, for example If Greece fails, and the end result will be an even stronger Canadian Dollar. On top of that, if the United States doesn’t get their finances in order, the Canadian Dollar will see a further surge upward.

Sometimes the Bank of Canada can raise their interest rates 2 or even 3 times and you may hear that the economy is improving but that doesn’t always mean that interest rates are going to go up. In fact we think that they are going to stay the same, or even go back down depending on what happens with Greece.

The good news is, the time is right to seize the day while Ontario mortgage rates are still at historic lows. Not only is it more affordable than ever to purchase a home, if you already own one, there are lots of ways that you can still take advantage of these low Ontario mortgage rates.

You can obtain a home equity loan to consolidate debt and work towards becoming completely debt free. You could complete a long overdue home renovation or purchase a vehicle. The sky is the limit. If you were planning a big ticket purchase your home is a great way to raise money to finance it at low interest rates.

It’s hard to predict when Ontario mortgage rates are going to go up so the best thing to do is obtain the right mortgage that works within your budget, so that if mortgage rates do go up, you are prepared. For more information about when Ontario mortgage interest rates are going up please visit http://www.gtamortgagematters.com/

Ontario Mortgage Rates - Part 2 --- When to lock into a fixed rate mortgage

When to lock-in to a fixed rate mortgage is a tough decision that should be thought through. An individual’s housing payment is usually the largest monthly payment in their budget.

Ontario Mortgage rates have been low for a long time so those who have chosen variable rate mortgages have enjoyed less mortgage interest than their counterparts, who selected the safer, fixed rate mortgage option.

Variable mortgage rates are great when interest rates are low. The difficulty occurs if mortgage rates go up. For example, a family who is living paycheque to paycheque should not have a variable rate mortgage.

Fixed rate mortgages have slightly higher interest rates but because the interest is fixed, so is the monthly mortgage payment. Families who have fixed rate mortgages do not have to worry that if interest rates increase so will their mortgage payment.

People choose variable rate mortgages because the rates are lower, low Ontario Mortgage Rates means lower monthly payments and more repayment to mortgage principal.

Variable rate mortgages fluctuate with the Bank of Canada’s lending rate. The Bank of Canada adjusts its lending rate according to the state of the economy. They consider not only the national economy but also the world economy.

For example, some have speculated that because the Canadian economy is doing better that interest rates will continue to rise (the Bank of Canada has raised its lending rate 3 times in the past year).

It is true that in Canada the economy has seen some improvement. However, this doesn’t mean that rates will continue to go up. In fact many believe that they will stay the same or perhaps they may even go down.

Many experts, including us, believe that in fact they will stay the same or even go down. With continued instability in countries such as Greece and the United States (debt talks), the Canadian Dollar will only continue to strengthen. This will hurt our manufacturing sector and local economy simply because no one wants to manufacture here when the exchange rate is so high. This in turn will result in The Bank of Canada leaving their lending rate as is or perhaps even reducing it in the near future.

The best way to try to predict when to lock into a fixed rate mortgage is to do lots of research and stay on top to the news. Establish a relationship with a mortgage broker who can let you know what you may expect with respect to Ontario Mortgage Rates and how to react. For more information please visit http://www.gtamortgagematters.com/

Ontario Mortgage Rates - Part 1 --- What is a Variable Rate Mortgage?

Trying to find the lowest Ontario mortgage interest rates? Whether you are looking to purchase a home or refinance it, the interest rate on your mortgage is important. Your mortgage interest rate will dictate how much interest you pay during your mortgage term and how much your mortgage payments will be.

There are two main types of mortgage interest rates in Ontario – fixed and variable rate mortgages. This article is about variable rate mortgages.

An Ontario variable interest rate mortgage is a mortgage where the rate is periodically adjusted to float with the Bank of Canada lending rate. Variable rate mortgages are also referred to as adjustable-rate mortgages.

If the Bank of Canada raises its lending rate, the financial institutions will adjust the interest rates of their variable rate mortgage customers accordingly.

When the Bank of Canada’s lending rate is low, Ontario Mortgage Rates are low. Variable rate mortgages carry risk because if the Bank of Canada’s lending rate increases, so does their mortgage rate and thus so does the monthly payment.

The reason individuals take the risk and choose variable rate mortgages is because variable rate mortgages are lower interest than fixed mortgages. Less interest means more of your monthly payments go to principal and your monthly payments would be less.

You can negotiate a variable rate mortgage that carries a provision that enables you to lock in your mortgage at any time. This way you can test out the waters with your variable rate mortgage while Ontario mortgage interest rates are low and then lock-in your mortgage rate if you think interest rates are going to increase.

Variable rate mortgages are best suited for those who have an aggressive goal of paying down their mortgage. This would be an individual with a lot of cash flow, one who is prepared to make more than their minimum mortgage payment each month.

Someone who is running a tight budget is not suited for a variable rate mortgage. The individual’s mortgage payment would increase in accordance with an increase in the mortgage rate so if their budget was tight to begin with, it could cause a major financial problem.

If you want to have the best Ontario mortgage rates, it pays to have a relationship with a good mortgage broker, one who works with all the banks, watching lending rates and ensuring that you always have the right mortgage and the best deal. To find out more about Ontario mortgage rates and variable rate mortgages please visit http://www.gtamortgagematters.com/

Who Sets Ontario's Mortgage Rates and Where Can You Find the Lowest Mortgage Rate?

Mortgage rates in Canada are set by the Bank of Canada. When the Bank of Canada changes interest rates, banks across Canada change their rates accordingly. When planning to purchase your home, the better informed you are about mortgage rates, the greater chances you will have of finding the lowest mortgage rate possible.

Most people think of only their bank when it comes time to get a mortgage. But when you deal with a bank, you are only dealing with one lender – the bank. Because mortgage rates fluctuate coast to coast, it’s a good idea to consider working with an Ontario Mortgage Broker to make sure you are getting the lowest mortgage rate possible.

Mortgage Brokers in Ontario have access to numerous financing choices that many people wouldn’t normally think of, including trust companies and private loan companies. Ontario Mortgage Brokers will research and compare mortgage rates from hundreds of banks and mortgage lenders across Canada to match the lowest mortgage rates with the best terms available. Using a Mortgage Broker in Ontario will save you time and money because all the research and paperwork will be done for you!

Take some time to educate yourself about mortgage rates in Ontario and across Canada. Start by subscribing to the Bank of Canada blog to learn about mortgage rates and how they fluctuate throughout the year and across Canada. Conduct Google searches for mortgage brokers offering the lowest mortgage rates. Visit the Financial Services Commission of Ontario (FSCO) website to locate a licensed Ontario Mortgage Broker who can assist you in the search for the lowest mortgage rates to fit your budget.

Doing some online research and consulting with an Ontario Mortgage Broker will save you time and money, and will increase your chances of getting the lowest mortgage rate possible to fit your budget.

The Mortgage Centre is one of Mississauga, Ontario’s leading mortgage brokerage firms, offering seamless solutions to all your mortgage needs. Whether you want to buy a home, set up a new business or even finance an existing loan or mortgage, we offer you the perfect solution to cater to your specific requirement.

For more information visit http://www.gtamortgagematters.com/

Get Out of Debt Ontario! An Ontario Mortgage Brokers’ Call to Action

At the end of 2003, Canadians held $517.7 billion in mortgages. There were 84,297 personal bankruptcies in 2003, up 52% from a decade earlier.

In December 2009, household debt in Canada reached $1.41 trillion. Spread evenly across all Canadians, each individual would hold approximately $41,740 in debt in 2009, an amount 2.5 times greater than in 1989. Total consumer credit issued by chartered banks grew from 21.1% in 1989 to 77.7% in 2009.

In Ontario alone, the Ontario Association of Credit Counselling Services reports a 60% increase in its clients since 2000 – clients whose incomes have increased by 15% on average but whose debts have soared by nearly 60%.

Some experts say a booming real estate market and interest rates at historically low levels have Canadians saving less and taking on more debt. The total debt per household is now equal to 125% of disposable income, up from 91% in 1990, an increase that has helped push insolvencies to record levels.

There is, however, a way for Ontarians to solve this crisis and get out of debt. With the help of a licensed Ontario Mortgage Broker, people in Ontario can consolidate their debt and begin saving money. A debt consolidation loan is a great idea, particularly if you have equity in your home, because it allows you to pay off multiple creditors at once, so you only have one payment to make each month instead of many payments.

An Ontario Mortgage Broker can assess if there is sufficient equity in your home to utilize a consolidation loan, and will assist you in the application process. You should consider a consolidation loan for the following reasons:

• A consolidation loan can reduce or even eliminate consumer debt
• Interest rates on a consolidation loan are usually lower than the interest rates on credit cards and lines of credit
• A consolidation loan replaces several different payments to different creditors with one monthly affordable payment to your financial institution
• Consolidation loan payments are affordable, and easy to manage and keep within your budget

It is recommended that you work with an accredited Ontario Mortgage Broker when applying for a consolidation loan to eliminate your debt. An Ontario Mortgage Broker has a solid relationship with all the banks and lenders to ensure you get the best rates and service you deserve.

For more information visit http://www.gtamortgagematters.com/

Who Regulates Ontario Mortgage Brokers?

In Ontario, mortgage brokers and the mortgage broker industry in general is regulated by the Financial Services Commission of Ontario (FSCO).

If you are planning to use the services of an Ontario Mortgage Broker, it is important that you educate yourself on the industry and that you are informed about the Mortgage Brokers and Lenders Administration Act (2006). It is also imperative that you:

• Confirm that the Ontario Mortgage Brokerage is licensed
• Confirm that the Ontario Mortgage Broker is licensed
• Understand how Ontario mortgages work
• Understand how Ontario Mortgage Brokers are regulated

It is against the law for an Ontario Mortgage Broker to operate business without a valid license. The FSCO exists to protect consumers against fraudulent mortgage practices, by requiring that all agents and brokers in Ontario prominently display their licensing information on their websites. If you are dealing with an agent or broker in Ontario, ask to see their license and qualifications before conducting business with that individual. If the agent or broker cannot provide documentation, always consult the FSCO first, before conducting business with that individual.

There are several benefits to dealing with a licensed and regulated Ontario Mortgage Broker or Brokerage:

• The Ontario Mortgage Broker will be properly educated and have experience in the field of Ontario mortgages
• The Ontario Mortgage Broker will be experienced and be able to provide advice confidently and accurately
• The Ontario Mortgage Brokerage will be held accountable for ensuring all Mortgage Brokers follow the law
• Should fraudulent activities occur, the Brokerage will have errors and omissions insurance with the proper coverage to protect consumers against these types of activities
• All Ontario Mortgage Brokers must disclose the nature of their relationship with borrowers and lenders

The FSCO monitors and investigates all incidents of non-compliance, and takes appropriate action against Ontario Mortgage Brokers and Ontario Mortgage Brokerages who do not follow the law. If the Ontario Mortgage Broker or Ontario Brokerage is not licensed with the Financial Services Commission of Ontario, it is recommended that you find an individual who is.

For more information visit http://www.gtamortgagematters.com/

How to Obtain an Ontario Mortgage Approval at Mortgage Terms that Fit Your Budget

For most people, buying a home is the biggest investment they will ever make. It can be both exciting and stressful, especially when it comes to the financial aspect of it. Before you even start shopping for that dream home, it is a good idea to crunch some numbers to see exactly what you can afford. So how do you get approved for an Ontario mortgage at rates that fit your budget?

Get all your eggs in one basket before you approach an Ontario Mortgage Broker or Brokerage. Create a financial report card that will detail in black and white exactly where you stand financially. The report card can contain the following information:

• Any outstanding consumer debt like credit cards, lines of credit, etc.
• A list of assets such as vehicles, property, investments, etc.
• A list of expenses including credit card payments, loan payments, utilities, car payments, groceries, insurance, etc.
• A history of consumer debt payments – do you pay your bills on time? Do you pay the balance in full or carry the balance month to month? Have you ever been contacted by a collections agency?

Once you have completed the financial report card, you should know what you can afford based on your income versus your debts and other monthly obligations. This is where the true research begins.

If your credit score is low or a traditional bank will not approve you for a mortgage, an Ontario Mortgage Broker also has access to many alternative lenders who may be more flexible with mortgage approvals. Additionally, an Ontario Mortgage Broker can guide you through a list of ways to repair your credit or increase your credit score to improve your chances of getting approved for a mortgage.

To get approved for an Ontario mortgage with the best mortgage terms that fit your budget, consider dealing with a licensed Ontario Mortgage Broker. An Ontario Mortgage Broker has built a solid relationship with banks and lenders to ensure the best mortgage terms possible. Working in tandem with that Ontario Mortgage Broker, visit your local banks or financial institutions to determine what mortgage rates they are currently offering based on the amount you believe you will need approval for. Take this information to your Ontario Mortgage Broker to see if lower rates are available.

Remember that the Ontario mortgage approval you receive must be on terms that fit your budget. Ask your Ontario Mortgage Broker to compare existing rates to make sure you get the best deal you need for the dream home you want to buy. Getting approved for an Ontario mortgage with terms that fit your budget is possible – it just requires a little research and a trusted Ontario Mortgage Broker.

For more information visit http://www.gtamortgagematters.com/

How to get Approved for the Lowest Interest Mortgage in Canada

If you want to get approved for the lowest mortgage interest rate in Canada then you are going to have to ensure that you are in tip top financial shape.

The lowest interest rates are offered to consumers who have excellent credit and a strong financial profile. So how do you know if that’s you?

First, request your credit report from Equifax. Lenders want to see that you have a minimum credit score/FICO score/Beacon Score of 680. Other things that are revealed on your credit report (even if your credit score exceeds 680) that the bank will frown upon are:
1. Too many applications for credit
2. Late payments
3. Too many credit products
4. Credit products that are near, at or over their limits

They also want to see that you can prove your income. Typically the bank will ask you to provide a T4 or paystub if you are employed. If you are self-employed the bank may ask you to provide two years of tax assessments.

They will also want to see that you have good stability and that your monthly payments to credit do not consume too much of your income. Your debt service ratios are calculations that your bank uses to measure what percentage of your gross income is consumed by housing and debt payments. As a rule of thumb your housing payment should not exceed 30% of your gross income and your housing payments plus consumer debt payments should not exceed 40% of your income.

These are all things that you should think about before you start shopping for a mortgage. Many consumers only approach a mortgage broker when they want a mortgage. A mortgage broker is an excellent resource to help you look at your financial profile and find ways to improve it so that you can qualify for the lowest mortgage interest rates that are offered in Canada.

For more information please visit www.gtamortgagematters.com.

Time to Lock In Your Mortgage If You Want Canada’s Best Mortgage Rates

Given the fact that Canada has raised its lending rate three times in the past year, now is a good time to look at your finances and consider locking in your mortgage. The Canadian economy is improving and one sign of this is the fact that the Bank of Canada has raised rates.

The Bank of Canada also recently cautioned Canadians about overuse of credit as the average Canadian household is carrying too much debt. This further signals that they want Canadians to reduce their debt because rates will likely continue to rise as long as the economy can sustain it.

If your household is carrying more than $20,000 in credit card debt, you may want to consider how you can use your home to improve your overall financial situation.

As the Canadian economy continues to improve, the Bank of Canada will continue to increase its lending rate. Refinancing your mortgage to consolidate debt can be a great option if you structure your new mortgage properly.

First, consider if it is time to lock into a fixed rate mortgage and commit to a longer mortgage term to avoid any fluctuation in your mortgage rate. Locking into a fixed rate mortgage could ensure that in the years to come you will have Canada’s best mortgage rate, even if the Bank of Canada’s lending rate continues to increase in the months and years to come. If you are trying to achieve short term financial goals and think you may be selling in the next 24 months then it may be a better choice to stay with a variable rate mortgage.

Second, when refinancing your home to pay debt, ensure that you reduce your mortgage amortization. For example, if you are currently 22 years into a 25 year mortgage amortization, do not refinance the mortgage back out over 25 years. You just wouldn’t believe how many people do this and the result is that you will start your interest all over again. If anything, in consideration to the new debt you are adding to your mortgage, consider reducing your mortgage amortization by one or two years.

If you want to lock in your mortgage and obtain Canada’s best mortgage rate consult your local mortgage broker and visit http://www.gtamortgagematters.com/

Do Variable Rate Mortgages Offer Canada’s Best Mortgage Interest Rate?

Generally fixed rate mortgages bear slightly higher interest rates than variable rate mortgages. This is because with a fixed rate mortgage the bank is guaranteeing your rate for a period of time no matter what happens in the economy. If Canadian interest rates go up and you have a fixed rate mortgage, your interest rate will stay the same.

Fixed rate mortgages also usually compound semi-annually (2 times per/year) where variable rate mortgages usually compound monthly (12 times per/year). If a bank it offering a variable mortgage rate that is within 1% of the fixed rate mortgage then the “amount” of interest that you end up paying is almost the same.

The reason variable rate mortgages are often offered at lower interest rates is because the interest floats with whatever the Bank of Canada lending rate is. If the Bank of Canada increases its lending rate and you have a variable rate mortgage, your interest rate will be increased accordingly.

In the past 10 years Canada has seen historically low interest rates and so many Canadian have gotten comfortable with variable rate mortgages while to the consumer they bear a higher risk. Low interest rates are a sign of economic instability and so when they are extremely low, they have nowhere to go but up. In Canada the Bank of Canada has announced 3 interest rate increases in the past 12 months.

So how do you decide what type of mortgage is best for you? Well that depends on your financial goals. If you plan to be in your home 5 years or longer it may be a good time to see what fixed rate mortgages are available. If you plan to move in the next year or two a variable rate mortgage may make more sense because interest rates are still very low and so you have less risk by choosing a variable rate mortgage and watching the economy. Most Canadian banks that offer variable rate mortgages offer an option to lock in.

The best thing to do to find out your options is consult a local mortgage broker. Mortgage brokers generally have relationships with all of the major Canadian Banks. They also deal with other banks like ING and PC Financial who offer mortgage financing in Canada but do not have a retail presence. A mortgage broker can educate you about your mortgage options and help you plan for a mortgage that will ensure you achieve all of your financial goals. For more information visit www.gtamortgagematters.com.

Canada’s Best Mortgage Interest Rate! Who Is Offering It?

Unless you have a lot of time on your hands, trying to obtain Canada's best mortgage interest rate is a lot harder than you think.

It's not hard because Canadian mortgage interest rates are high, it's hard because there are so many lenders.

Traditionally Canadians have turned to their banks for a low interest mortgage approval but now Canadians have so many other options. “No branch” banks like ING and PC Financial have no overhead and usually offer lower interest mortgages than the major banks. Also some banks have large mortgage centres and offer promotions that are not available to the public.

The best way to have your finger on the pulse of Canadian mortgage interest rates is to start a relationship with a Canadian Mortgage broker. You don’t have to be looking for a mortgage right “now”, but doing so will enable you to develop a relationship with someone who will be able to help you in the future.

Your broker can help you prepare, plan and shop around for the best mortgage interest rates, without you racking up unnecessary credit inquiries to the credit report.

A lot of Canadian mortgage lenders (including banks) don’t advertise to the public or have retail locations because they exclusively loan their money out through mortgage brokers. The only way to get these deals is to have a mortgage broker.
If you haven’t contacted a mortgage broker because you didn’t want to get onto the radar and start receiving sales follow up, then follow their blog. Following their blog enables you to receive useful information and updates. For more information visit http://www.gtamortgagematters.com/

Use Your Home to Consolidate Debt but Choose a Lower Amortization Instead of a Lower Payment

If you have accumulated a lot of debt and you have some home equity, your home is a very affordable tool that you can leverage to negotiate a low rate consolidation loan.

In many cases homeowners who refinance their homes to consolidate debt will blend the debt into their first mortgages. Depending on the new mortgage amortization, your new mortgage payment may not increase at all and because the debt has been eliminated you will immediately free up new cash flow.

The danger here is that the debt still exists only it’s been transferred over to your home. If you are 5 years into a mortgage that was originally amortized over 25 years and have 20 years left, refinancing your mortgage amortization back out over 25 years puts you right back to step one and with an even bigger mortgage.

Your bank or broker may even quote you a payment based on the maximum amortization. Don’t be afraid to ask your mortgage broker to quote you the payment based on different amortizations so that you can compare.

Here is an example based on a consumer with a mortgage that has a 20 year amortization left on it, a balance of $220,000, a 6% interest and a monthly payment of $1,315 per/month. If the same consumer was also carrying $25,000 in debt with monthly payments totalling $1,200 per/month the consumers total monthly payments would be $2,515.

If the first mortgage was refinanced to $245,000 to pay off all the debt at the same rate based on a 25 year amortization the new monthly payment would be $1,288. The debt would be completely wiped out and the new monthly mortgage payment is almost the same as what the consumer had been paying on their existing mortgage.

The same mortgage that is paid off all the debt based on a 20 year amortization would have had a monthly payment of $ 1,480 per/mo and $ 1,808 monthly mortgage payment based on a 15 year amortization. The 15 year amortized mortgage makes the most financial sense because you have reduced your total mortgage repayment to 15 years and have still reduced your monthly payments by $700 per/month.

This is just one example of how you can use your home to pay off debt while making effective financial decisions that consider the whole picture. For more information about how to use your home to consolidate debt and choose a lower amortization instead of a lower payment please visit www.gtamortgagematters.com.

How to Get the Lowest Mortgage Interest Rates in Brampton

If you own your home in Brampton and are thinking about buying another home or refinancing; or you don’t own a home yet and simply want to purchase a home in Brampton, you may be starting to think about how you can get the lowest mortgage interest rate.

Your first thought may be to speak with your bank. While your bank may offer you a good deal, it still may not be the best mortgage interest rate with the best mortgage terms. Shopping around could be scary because the last thing you want to do if you are looking for a mortgage is rack up inquiries on your credit report which will drag down your credit score.

Also, going back to the idea of going to your bank as your first choice, well it may also just be a better idea to diversify your portfolio establishing relationships with different creditors. For example, if your bank account, RRSP, and mortgage are with different banks, you will have more borrowing power in the future as all three will know you. If you put all of your credit products in the same place, then only one financial institution will know you.

Your best bet is to look for a local mortgage broker. They will have access for mortgage interest rate information about all of the major banks as well as other lenders at the local level, like Trust Companies, Credit Unions, Mortgage Investment Corporations and more. They also have access to major banks that don’t have a retail presence like ING, PC Financial and some others that often offer lower mortgage interest rates than the major retail banks.
It doesn’t cost anything to speak with a mortgage broker about what’s available and in many cases, the bank or financial institution that you choose will cover the broker’s fee, so in most situations you don’t have to pay the mortgage broker anything!

What is important is that you do a lot of research because a home and mortgage is a huge financial undertaking. We are not talking about thousands of dollars here, we are talking about hundreds of thousands of dollars and even a 1% savings interest can make a substantial difference in your principal mortgage repayment and monthly mortgage payment. For more information visit www.gtamortgagematters.com.

How To Find A Brampton Mortgage Broker

Brampton is a great area to own a home. It is located in the suburbs of the GTA and is close enough to Toronto that you could commute in and out of Toronto for work.

This is one reason that more and more homeowners are selling their homes in Toronto for a more suburban lifestyle in Brampton.
If you are thinking of purchasing a home or own a home in Brampton and want to refinance, then a strong relationship with a good mortgage broker in Brampton is the right choice.

There are too many conflicts of interest present when you use a Real Estate agent to find a mortgage or go directly to a financial institution yourself.

If you visit a Bank or Finance company you are going to be subject to their lending guidelines and restricted to the credit products they are prepared to offer you.

Other mortgage referrers like real estate agents often have a hidden agenda and will be receiving an incentive or kickback from the broker or institution that they refer their client to.

Do your own research. Find a mortgage broker independently, who works with a wide cross section of lenders so that they can present you with a diverse range of mortgage options.

If you live in Brampton you could take advantage of a Mississauga mortgage broker. Mortgage brokers in Mississauga often serve the Brampton and Mississauga areas and are very knowledgeable about the real estate markets and lending guidelines in these areas. They also may have access to private lenders who prefer to lend in these municipalities.

For more information about how to find a mortgage broker in Brampton please visit www.gtamortgagematters.com