Arranging A Mortgage

Arranging a mortgage is an important first step in purchasing your home. It will help you understand the total cost of your purchase and will help set a price range that works for you.

Some of the factors that lenders look at when approving a mortgage include:

• Household Income for parties who will be on the title as new owners
• Household Debts and Expenses
• Credit History
• Employment Record
• Appraisal of the Property

Once you have purchased your home, the total time from loan application to approval can take from 2-5 business days, depending on the loan type, market conditions and/or complexity of verifying the borrower’s information and qualifications.

Please note that the information provided to the lender is confidential.

The Benefits of a Pre-Approved Mortgage

Pre-approved mortgages help you determine:

• The amount that you can borrow.
• The interest rate of your mortgage for the term you’ve selected.
• How much each of your payments will be.

This will allow you to shop with confidence. An added bonus is that many financial institutions offer rate guarantees for up to 90 days. This may protect you against interest rate fluctuations. Speak to one of our partner Mortgage Consultants for further information. 

Mortgage Loan Insurance

Mortgage Loan Insurance is required when a mortgage loan is more than 75% of the purchase price of a home.

It allows potential homebuyers to purchase a property with as little as 0% down.

Loans are available through your lender and are insured by CMHC (Canada Mortgage and Housing Corporation) or GE Capital Mortgage Insurance Canada. This insurance protects the lenders against loss due to borrower default on the loan. Premiums range from 0.5%-3.75% of the amount of your loan (additional charges may apply), depending on the size of the loan and the value of your home.

Paying the premium - The premium can be added to your mortgage loan and paid off as part of your regular mortgage payments, or paid off in a lump sum at the time of purchase to save interest charges on the premium itself.

Eligibility - Both new and resale homes are eligible. However, some criteria that must be met to qualify for this insurance include:

The home must be in Canada and must be your principal residence.

Housing payments, including principal, interest, property taxes, heating (P.I.T.H.), the annual site lease in the case of leasehold tenure and 50% of applicable condominium fees, can’t be more than 32% of your gross household income.

Your total debt load can’t be more than 40% of your gross household income.

Other criteria apply and are subject to change. For more information, please discuss with your Buyer Representative or Mortgage Consultant.

Additional Insurance - Many financial institutions offer you the ability to purchase insurance on a mortgage to cover unexpected job loss or loss of life. This may be something to consider in order to protect your family’s financial future. Please contact your financial institution for further information.