Frequently Asked Questions About Getting a Mortgage

Mortgages are incredibly helpful but complicated financial tools. For optimal benefits, you need to understand how they work and where you can derive benefits. However, when it comes to acquiring a mortgage, you may have many questions but find answers difficult to come by. Fortunately, Shahab Shahisavandi, mortgage agent for Dominion Lending Centres Edge Financial, understands this predicament. To arm you with the most accurate information available, we’ve identified and answered some of the most frequently asked questions about getting a mortgage.

1. How do I find a good deal for a mortgage?
There is no simple answer to this question as each individual financial situation is different from the others. It is of paramount importance for each applicant to set a clear goal and plan toward their finances to help them find the best deal out there. That said, REMEMBER! Rate is essential and will cost you a lot, but it’s not the most crucial element of any mortgage.

2. Should I hire a mortgage professional?
It is best to answer this question with an alternative question. “How would you treat yourself when your tooth hurts?” Seeking professional advice is always a better idea. It’s even more reasonable when it almost bears no cost for you. Finding the right mortgage is an overwhelming process, and our advice is to hire a professional to help you along this process.

3. Should I choose a fixed or variable rate?
The fixed-rate is designed to save you from most uncertainties out there and hence the higher figure. With this rate, you’ll be paying a fixed monthly payment for the term of your mortgage. This will allow you to better plan and layout your financial landscape in life. Depending on your plan, variable rates can be beneficial too, but they can change with economic fluctuations. At some point, you might benefit heavily from the low rates and, in some cases paying higher interest rates than others. If your financial situation would allow you to observe these fluctuations, you certainly can benefit from its lower rate. Having said that, your mortgage broker or financial is in a much better position to advise you on this topic.

4. What is the minimum down payment I need to purchase a property?
The industry standard would consider 5% as the minimum payment, but you should bear in mind that this doesn’t mean you can’t buy a house with less than 5%. In some cases, lenders offer a cashback, which can be utilized toward your down payment. It’s also important to know that if you have 5% of the value, you would be eligible for the remaining amount. Again, your mortgage specialist can assess your financial situation to better guide you on your affordability and, ultimately, borrowing power.

5. What is the difference between insured and insurable mortgages?
Insured mortgages are deals that are insured by an insurance company. They have lower rates due to the minimal risk for the lender. In case of any default, the insurance will pay the lender the full balance. In these cases, the borrower is responsible for the insurance premium payable to the insurance company. Any down payment less than 20% will fall in this category and must be insured. In insurable mortgages, the difference is that lenders would pay for the insurance premium.

6. When should I apply for a pre-approval?
It’s certainly a good question. The answer is; You need to discuss your plan with a financial advisor or mortgage professional as soon as you have a plan to purchase a property. This will help you in laying out strategies for maximizing your borrowing power. Once you have that strategy in place, usually within sixty to ninety days of your closing, you can apply for a pre-approval.

7. How do I get a construction loan?
This is rather a complicated process, but a mortgage broker can certainly add immense value. Construction projects are divided into different phases, and in each phase, there is a special lending solution. Depending on which phase you are in, your mortgage broker can help you get the best deal possible to complete your project without any hassle.

8. Can I apply for a mortgage for my company?
The short answer is “yes.” Having said that, when it comes to companies and their structure, there are many details that lenders would consider before reviewing your file. It’s always best to let your mortgage broker help you with the application to get the best out of all solutions available to you.

If you have any more questions about getting a mortgage, reach out to Shahab Shahisavandi, one of the leading mortgage agents for Dominion Lending Centres Edge Financial. With over three decades of experience in the mortgage industry, we have what it takes to meet your financial needs so you can purchase the home of your dreams. We adapt to the emerging trends and technology and educate you, so you are aware of what you’re getting into. We provide unbiased advice and guarantee free services as we are paid by the lenders you borrow from.

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