For many people, mortgage payments are their single largest expense. Yet, when financing a home, most Canadians donât comparison shop to ensure theyâre getting the best mortgage rate and terms available. This mistake can cost homeowners tens of thousands of dollars over the course of their mortgage.
Here are seven ways mortgage brokers can help:
Access to competitive rates
Brokers deal with multiple competing lenders and can often access exclusive rates. Based on the number of mortgages brokers complete each year, they also have the power to negotiate rate discounts from lenders, which can be passed on to their clients.
A free service
Mortgage brokersâ services are typically available at no cost to consumers. Brokers are paid by the lender selected by their clients.
Knowledgeable advice
Brokers offer consultative service, advice and solutions that are customized to each clientâs needs. And unlike banks, brokers work for you.
Speed and convenience
Brokers will work around a clientâs schedule to make the transaction as easy and convenient as possible.
Pre-qualification
Whether youâre shopping for a new home or refinancing your existing mortgage, a broker can help you obtain a pre-approved mortgage, often with up to a 120-day interest rate guarantee.
Preserved credit rating
When you shop for a mortgage, there is an accumulation of lender inquiries on your credit bureau report, possibly affecting your credit rating and, ultimately, the rate and terms of your mortgage. This isnât the case with a mortgage broker, who only does one inquiry yet can still get many competing lenders to quote on your business.
Peace of Mind
The Canadian Association of Accredited Mortgage Brokers has a stringent Code of Ethics that members are required to adhere to in order to retain membership.
There are many stresses associated with home buying – both financial and emotional. And frankly speaking, it doesn’t help that the process comes with its very own foreign language. While your mortgage broker can help de-mystify these terms, it helps to have a bit of a primer on what some of these terms mean. After all, it’s your money and your home we’re talking about; as a Mortgagor, you have a right to understand what you’re reading. (You didn’t know you were a mortgagor? Read on…)
We’ll start with Amortization” and “Term”. Both refer to periods of time in the life of your mortgage, and you’ll want to be sure that you understand the difference.
The amortization” of your mortgage is the length of time that would be required to reduce your mortgage debt to zero, based on regular payments at a specified interest rate. The amortization period is typically 15, 20 or even 25 years, although it can be any number of years or part-years. You could establish that you are able to make a certain payment each month of say $950 for your $130,000 mortgage at 5.5%. In this case, your amortization period will be just under 18 years. Or you could tell your broker that you’d like to be mortgage-free in just 10 years. With an amortization period of 10 years at the same interest rate, your $130,000 mortgage will cost you about $1,407 per month. That’s a tougher monthly payment, but you would save thousands of dollars in interest. (More than $35,000, in fact.) As you arrange your mortgage, then, keep in mind that your amortization period may be fairly long — although the shorter you can make it, the less you’ll wind up paying for your home in the long term.
The “term” of your mortgage will typically be shorter. The “term” is the duration of your mortgage agreement, at your agreed interest rate. This will be a very specific length of time, although you will have several choices. A 6-month mortgage is a very short-term mortgage. A 10-year mortgage will be one of the longest terms, generally with a higher rate of interest to represent the higher degree of uncertainty in the economic outlook. After your mortgage term expires, you will need to either pay off the balance of the mortgage principal, or negotiate a new ontario mortgage at whatever rates are available at that time.
Now, back to the term “Mortgagor”. This is one of three very similar terms: “Mortgagee”, “Mortgagor”, and “Mortgage”. A Mortgagee is the lender of the money: a bank, company, or individual. A Mortgagor is the borrower: the person or persons (or company) that is borrowing the money, and who will pay it back to the mortgagee. The Mortgage, of course, is the legal document that pledges the property as a security for the debt.
Still confused? Speak with a mortgage professional. Get the best mortgage suited to your needs and all your questions answered in plain talk.
The House Team is commited to providing quality information to help people make informed decisions about their mortgage financing needs.
Identifying the best mortgage rate is not very easy. There are various other factors to be considered to identify the best mortgage rate.
You can identify the best mortgage rate based on the interest rate, the time duration for which you wish to hold onto the mortgage, the Annual Percentage Rate or APR and whether you are refinancing or purchasing the property.
A careful comparison of various mortgage rates offered by various mortgage loan lending institutions will enable you to select the best mortgage rate that suits your requirement. A number of related websites are there to provide mortgage loan rate quotes of different loan lending institutions. Compare the current mortgage rates for the same type of mortgage. You can compare mortgage rates based on lender, points, rate, APR, fees in APR, lock, or estimated payment. Mortgage rates fluctuate based on the location, the loan amount and the economic state of the country. So it is always better to consider the mortgage rates of the same mortgage plan of few different lenders in order to choose the best mortgage rate. Mortgage rates may change considerably from day to day. Hence it is important to compare the mortgage rates of multiple lenders on the same day. After making thorough comparison, identify one or more mortgage options based on your mortgage goal.
The home mortgage calculator is one of the powerful tools used for calculating the best mortgage rate. Using home mortgage calculator you can also know whether a particular mortgage is affordable to you or not. It takes just few minutes to evaluate each option of mortgage rate using the mortgage calculator. Hence you can easily choose the mortgage that best fits your needs.
You can choose a better mortgage rate based on the advice from an experienced mortgage broker. A mortgage broker or mortgage agent researches the market and identifies the best option suitable for your mortgage goals. Mortgage brokers will guide you in every step of your mortgage process, from identifying the best mortgage rate to making the complete mortgage deal. But the only disadvantage of using a mortgage broker is that they require a fee. Mortgage brokers who are well familiar with the mortgage industry can suggest you with smart options. The important thing in using a mortgage broker is that you must be careful in selecting an experienced and professional mortgage broker.
If you are familiar about the mortgage industry and you are comfortable with the internet, then a good mortgage lender would be your best choice. You can search out for mortgage lenders yourself. This involves educating yourself about mortgage details before contacting the lender. Contacting and working directly with mortgage loan lenders is free, but in this case you cannot expect the best deal unless you are well educated about the mortgage industry.
Some of the above useful tips enable you to identify the best mortgage rate. It is wise to get the best mortgage rate so that you can save money over time. If you are more educated about the mortgage terms and mortgage industry, it will be quite easier for you to find the best mortgage rates. And you need to invest your time and effort to learn more about mortgage loan options and rates, and do enough research in order to find the best mortgage rate.
Real estate has been an outstanding investment in most parts of Canada in the past few years. Home valuations are continuing to rise and have broken through the peak of their 1989 “bubble” in many areas of the country. That’s good news for Canada’s 7.5 million home owners, who are enjoying an average increase of $43,000 in real estate wealth since the upward trend took hold in 1998.
The hot housing market is being fuelled by mortgage rates which are the lowest they’ve been in almost 50 years. First-time home buyers are finding the rates attractive, and home buyers are lining up to purchase their first home or to upgrade to their dream homes. Housing statistics have been capturing headlines for months and the boom is noticeable on key economic indicators.
But the news isn’t just about rising valuations or Canadians moving into their new homes. Quietly in the background, there is a significant trend to refinancing. Canadians who have built up the equity in their home over the last few years are borrowing against that equity in record numbers. According to a report from a major bank, since 2001, Canadian households have taken out approximately $20 billion in cash out of their homes through mortgage refinancing and home equity loans.
We might thank the Ontario mortgage industry for the surprising resilience of the North American economy. In the past two years, the North American economy has endured numerous economic fallouts but consumer confidence remains reasonably strong – at least partly because homeowners have seen some of their losses offset by an increase in their real estate wealth. We find that we are sitting on (and sleeping in) the best-performing investment we own. And even if they have no plans to sell, homeowners have found that the return on their investment is still as good as cash in the bank.
That cash has been a key economic stimulus both here and in the U.S., where the trend is even more pronounced. As Canadians look beyond the view of a home as primarily shelter, mortgages become a valuable resource – and homeowners aren’t necessarily waiting for renewal time to cash out some of their gains.
So where is the money going? The equity being pulled out is often being used to pay down other more expensive debt. Credit card interest rates are shockingly high and – as a nation – our credit card and other consumer debt is continuing to grow. And much of the money is being used for increased spending. There has never been a better time to borrow against home equity to build the kitchen of your dreams, add a new wing, embark on the landscaping project you’ve wanted for years, enjoy the vacation you’ve always dreamed of, or help with the high cost of post secondary education. However, as always, never let your enthusiasm for the opportunity to spend get in the way of good common sense about debt management.
The House Team is commited to providing quality information to help people make informed decisions about their mortgage financing needs.
www.teachexcel.com This video tutorial will show you how to make a fixed rate loan or mortgage calculator in excel. It is actually quite easy to do and after watching this step-by-step example and walk-through, you will be able to make your own also. This tutorial uses the PMT() function to calculate the required payments and it is also explained in the tutorial. To follow along with the spreadsheet seen in the tutorial or to get some free excel macros or tips & tricks, go to the website www.teachexcel.com
Prison, payback in Va. mortgage scheme
NORFOLK, Va. (AP) — A Virginia Beach man has been sentenced to five years in prison and ordered to pay $1.1 million in restitution after pleading guilty to wire fraud in a mortgage scheme. The government says 44-year-old Wayne Marlon Benedic Lezama was sentenced Tuesday in U.S. District Court in Norfolk. He entered his guilty plea in November. According to court documents, Lezama was involved in …
Visit my new blog… mrmortgage.ml-implode.com Wells Fargo Subprime toxic waste exposed. Do they have to raise capital? Mr Mortgage shows a 2006 Wells rate sheet. This is hard evidence of Wells doing nasty subprime loans for borrowers with scores as low as 500 and 120-day mortgage late payments, which is essentially foreclosure status. They did not sell this directly to consumers, rather used correspondents like New Century, Accredited, Countrywide etc to rebrand the programs and sell them as their own. This is a very common practice but this just proves Wells is dirtier than most. First, because not everyone did subprime. Second, because they lied of course.
Mortgage lending falls to 10-year low
After a December rush due to the stamp duty holiday, January’s gross lending was 21% down on the same time last year Mortgage lending fell to a 10-year low in January, figures from the Council of Mortgage Lenders (CML) showed today. Gross lending fell to an estimated £9.1bn during the month, a 32% fall on December’s figure and 21% lower than in January last year. Although a drop is expected at …
Obama unveils mortgage plan to help California, 4 other states
In Nevada, the president touts a $1.5-billion program designed to help people in danger of foreclosure. He also talks up beleaguered Sen. Harry Reid. Standing in the heart of the nation’s hard-hit foreclosure country, President Obama on Friday rolled out a $1.5-billion mortgage program meant for a handful of states, including California and Nevada, that have endured waves of home foreclosures …
Mortgage fraud task force comes to Miami
The Financial Fraud Enforcement Task Force kicked off the first of its mortgage-fraud summits Wednesday in the epicenter of the nation’s mortgage-fraud crisis and pledged to begin finding solutions.
