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Unlock Your Home Mortgages
Frequently Asked Questions
Q: What is your best rate?
A: Well, right now I have access to the lowest rates out there, I’m just not sure you do. Rates are dependant on several things; your beacon score, your income to debt ratios, how much of a loan are you looking for, and whether your mortgage is insured or conventional. I won’t know any of this until I pull your credit and put your application together. Once I have the whole picture, I shop the best rate for your financial situation and how to make your mortgage work for you.
Q: How much money do I have to put down?
A: The minimum down payment is 5% of the first $500,000 of the purchase price, and 10% on the portion between $500,000 and $1.5 million. If your down payment is less than 20%, your mortgage must be insured through CMHC or another insurer, and the property must be owner-occupied.
If you want to avoid mortgage insurance, you’ll need to put 20% or more down. Homes priced above $1.5 million are not eligible for mortgage insurance.
Some lenders may also require a larger down payment for self-employed borrowers or rental properties.
Q: What is Mortgage Loan Insurance?
A: Mortgage Loan Insurance is required if your down payment is less than 20% If you put less than 20% down payment, you will need mortgage loan insurance. This insurance protects your lender in the event you default on your mortgage payments.
Q: Why should I work with a broker/agent?
A: Options! We work with banks, mortgage finance companies, credit unions, alternative lenders, B-lenders, and even private lenders; we say yes when the bank says no! In most cases, we will have a way to get your mortgage done! Mortgages shouldn't be a one size fits all, we shop the options specific to you.
Q: What if I don’t have great credit or a high beacon score?
A: We have lenders for all types of deals, you may have to pay a bit of a higher rate or put more money down as a deposit but where there's a broker, there's a way (*usually).
Q: Should I take a variable rate or a fixed rate?
A: A fixed-rate means you are locked in for a term and know what your monthly mortgage payment is, which will not change until the end of the term. Variable rates are often lower than fixed rates; however, they fluctuate with changes to the Bank of Canada Rate.
Q: What is the Stress Test?
A: The government of Canada introduced the stress test a couple of years ago to ensure Canadians were able to absorb any increase in mortgage rates when they came up for renewal, should rates have increased. You have to qualify on the higher of the two; (a) the rate on your contract plus a 2% cushion or (b) the BoC 5-year rate at the time of application referred to as the Benchmark rate.
Q: I am business for self, and I don’t show a lot of income on my taxes, but I make a lot of money, will I still qualify for a mortgage?
A: I have access to various stated income products; every lender uses different qualifying matrix’s outside of supplying your NOA. Alternative lenders offer a lower barrier of income confirmation; however, you will still need to provide some proof of cash flow by way of six months of bank accounts statements and financial statements coupled with your full T1's.
Q: I have claimed bankruptcy in the past, will that affect me now?
A: Maybe? In order to have your application looked at with an A lender like a bank, you will need to have been discharged from bankruptcy for two years. During those two years you will need to have at least 2 trade lines reporting to the credit bureau and PERFECT payment history. If not, we would move to the B lender space. B lenders will have higher tolerance levels but also higher interest rates.
