It’s funny anytime you bring up real estate prices with your parents, and they tell you they bought their first home for $150,000 20 years ago. And look at them now. Yes, it’s true, homes are expensive, but the silver lining is that mortgage rates are at a historical low. Borrowing money to purchase what your can afford is cheaper than ever. That being said, not all mortgages are the same, and with the help of a mortgagee professional like myself, we’ll be able to advise you on which is best. Here are some mortgage tips to consider:
- Pre-payment privileges – Some Banks/Lenders don’t allow for additional or increased payments, while others you can pay down the principal mortgage amount by up to an additional 20% per year. This will save you money over the lifetime of your mortgage.
- Low interest rates – The big buzzword in our industry. Here’s another tip. Instead of going from bank to bank on your day off to find out what each Bank will offer you, sit down with a mortgage professional. Look at it this way, would you rather a) have an hour conversation with someone that spends 60-80 hours per week working on saving people money by way of their mortgage or, b) spend your Saturday going from bank to bank, having the same conversation over and over again, and to be honest not really being sure what’s good or bad, or if they’re actually telling you the truth. Fact – Banks will need to pull your credit in order to find out what rate they can offer. Without this information in hand, anything they tell you is an estimate. Having your credit pulled over and over again can lead to damaging your score, and potentially risk losing your AAA rate access.
- Consolidation of liabilities – You owe money on your credit card at 21%, and have a car loan at 5.75%. Imagine lumping all of your high interest payments into your mortgage, and paying it all off at 2.5%?! A Broker like myself is trained to spot things like this, and help.
- Pre-approval – Brokers have the ability to safe guard their clients from increasing rates because we can hold rates for up to 120 days. This way the client is safe from increasing rates 120 days out from completion, but will have access to lower rates if they decrease.
- Mortgage options – Did you know you can apply for a mortgage that give’s you up to $40,000 for renovations on your mortgage? Or a mortgage product that will allow you to use up to 2.5% of your Line of Credit for a down payment, or access to a Line of credit at Prime (currently 2.7%) + .5%? Brokers like myself can provide options, not an option.
A mortgage is complex, so I urge you to sit down with a mortgage professional that has a strong track record (check his online reviews). You wouldn’t go to a Dentist that doesn’t have their license would you? If you knew your Bus Driver never passed his test, would you get on the bus? I wouldn’t go to the Dentist, and I sure as heck, would not get on the Bus. I assume you’d do the same. Therefore speak with a Mortgage “licensed” professional when dealing with your mortgage. In most cases, we’ll be able to work with your Bank if that’s the best option for you, or provide other options that may be more advantageous to your situation.
Please comment below, or contact me personally if you have any questions.
Have a great day.