Mortgages
Obtaining a mortgage is one of the most important decisions you may ever make. With so many different types of mortgages in today's market, the right advice can save you thousands of dollars. We have provided a
large amount of information below about many of the different products in the Canadian market.
There is absolutely no cost, hidden fees, or obligation to use a mortgage broker. If you are unsure, or have any questions throughout the home buying process, please email or contact us with any questions you may have, we are here to help!
Click on the links to the right to
view specific mortgage product information. ------------>
Fixed Rate or Variable Rate Mortgage
A fixed-rate mortgage will not change throughout the entire term of your mortgage. As a result, you'll always know exactly how much your payments will be and how much of your mortgage will be paid off at the end of your term.
A variable-rate mortgage will be set in relation to prime at the beginning of each month. In other words, it may vary from month to month. Historically variable-rate mortgages have tended to cost less than fixed-rate mortgages when interest rates are fairly stable, however they are higher risk due to the uncertainty of future interest rates.
Short Term or Long Term Mortgage
The term is the length of the current mortgage agreement. A mortgage typically has a term of six months to 10 years. Typically the shorter the term the lower the interest rate will be.
A short-term mortgage is usually for two years or less. A long-term mortgage is generally for three years or more. Short-term mortgages are appropriate for buyers who believe interest rates will drop at renewal time. Long-term mortgages are suitable when current rates are reasonable and borrowers want the security of budgeting for the future. The key to choosing between short and long terms is to feel comfortable with your mortgage payments. After a term expires, the balance of the principal owing on the mortgage can be repaid, or a new mortgage agreement can be established at the then-current interest rates.
Open or Closed Mortgage
Open mortgages can be paid off at any time without penalty and are usually negotiated for very short terms. They are suited to homeowners who are planning to sell in the near future or those who want the flexibility to make large, lump-sum payments before maturity.
Closed mortgages are commitments for specific terms. If you want to pay off the mortgage balance, you will need to wait until the maturity date or pay a penalty.
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