What’s the difference between a Broker and My Bank?
A Broker has access to all Major Banks and as well as many non conventional (private) lenders. The broker knows the lending guidelines of all these lenders and can offer you greater flexibility in qualifying and on the mortgage terms. A broker does not work for a specific institution and is focused only on YOUR NEEDS!
How much do I need to put down to avoid paying CMHC Insurance fee?
You will need a minimum of 20% down.
How much do I need to have available for closing costs?
Though this varies depending on your location and specific circumstances, most First Mortgage lenders require you to show 1.5% of the purchase price. Second mortgages vary widely depending on the lender but you will be given the total costs along with your original quote.
What’s the minimum I can put down to purchase a home?
Minimum down payment required is 5% of the purchase price.
Can I still get a mortgage if I have bad credit?
Yes but you will likely need a larger down payment and may get a rate that’s higher than our lowest rates.
What is a 2nd mortgage?
A second mortgage is a loan secured by your home which goes behind your 1st mortgage.
What is the average interest rate for a 2nd mortgage?
2nd mortgage rates will range between 10% and 15%
Can I get a 2nd to the value of my house?
No, 2nd mortgages are available to 85% of the value of your home, 90% on exception.
What am I allowed to use the money for?
You can use the money for anything you’d like.
What happens if I miss a payment (do they take my house)?
They will not take your house for being one month behind, but as with your 1st mortgage you cannot fall 3 months behind or they will take legal action.
How do I make payments?
In most cases, for a 2nd mortgage you will provide the lender with 12 post dated cheques. For a first mortgage you will usually provide the lender with a void cheque and payments are taken directly from your bank.
What fees will I have to pay?
For a 2nd mortgage you will be responsible for the brokerage fee, legal fee, lender fee and an appraisal fee.
Can I use my own lawyer?
Yes, for 1st. mortgages you can. For 2nd mortgages the lender will have their own lawyer which you must use. However, you may use your own lawyer as well, but an additional solicitor will add to your total cost.
Who will have to sign on this mortgage (everyone on title)?
Everyone on the title to a property will have to be on the mortgage.
Does all of my money go to interest?
Most often yes, but some of the 2nd mortgage lenders will allow you to pay principal and interest. Most of the 1st mortgage lenders allow principal and interest payments.
Will we need an appraisal?
All refinances will require an appraisal at the clients’ expense. A home purchase may not require an appraisal depending on the property.
Who chooses the appraiser?
The lender will choose the appraiser.
Do I have to bring the fees in to the lawyer in cash?
For a refinance: You can either bring the closing fees to the lawyer in cash or have them deducted from the equity. For a purchase: you will have to bring all fees in to the lawyer at closing.