Frequently Asked
We are here to build a long term relationship with our clients, so that once they have gotten their mortgage with us, we will also be available anytime to help throughout their mortgage term and beyond. Paul started Wheatland Financial in 2009 and we are not going anywhere for a long time. We aim to be the main point of contact for our clients regarding their mortgage and home ownership.
Yes certainly! We would love to help with this very exciting purchase. We have helped people obtain mortgages to purchase cabins, vacation properties, and revenue properties all over the province!
No we don’t charge our clients! We are compensated by lenders in the form of a referral fee when a deal is complete. Our clients get the best service and help with their mortgage at no charge to them!
The time to renew is a very important time during your home ownership. It gives you a chance to re-evaluate your goals in many areas. And it is often a time that you will be able to move to a new lender and get a better rate or features for your goals. Don’t every feel like you are “stuck” with offer the lender you have your mortgage through currently, you have many options out there that we are happy to help you explore.
In our opinion, when it comes to any financial decision you should explore your options, not just take the “easy” route. This can cost huge sums of money. This is especially true over the life of your mortgage, which is the biggest purchase most of us will make in our life. Having a Mortgage Professional work for you and find the best option available for you a simple way to know that you are making the right choice.
General Mortgage Informaion
This is the number of years it will take to pay off your mortgage. The most common amortization for a new mortgage is 25 years.
A bridge loan is a short-term financing tool that helps purchasers bridge the gap between old and new mortgages. It allows them to use the equity in their current house as a down payment before the sale closes. This allows them to move into their new home and essentially own two properties at the same time as they wait for the sale of their existing property to close.
A closed mortgage is the typical mortgage that people have. Closed means that if prepaid, renegotiated or refinanced before the end of the term without paying a prepayment penalty. Most closed mortgages do contain prepayment privileges, such as the right to make a prepayment of 10-20% of the original principal amount each year through lump sum payments as well as the option to increase the regular payments without penalty. Closed mortgages offer much lower rates than open mortgages which is why they are preferred.
There are various expenses associated with purchasing a home. These costs can include legal/notary fees and disbursements, property land transfer taxes, utility set up, home and title insurance as well as adjustments for prepaid property taxes or condominium common expenses, if any.
A mortgage where the buyer has put 20% or more of the purchase price as a down payment, which allows the buyer to avoid payment a mortgage insurance premium.
The percentage of the borrower’s gross income that will be used for monthly payments including all debts, principal, interest, taxes, heating costs and condominium fees. Banks look at this when assessing how much money they can loan you.
A sum of money given in trust by the purchaser when making an offer to be held in trust by the sellers agent, broker, lawyer or notary until the closing of the transaction. This is counted as part of the down payment on a purchase.
The amount of money you put toward the purchase of a home. The minimum in Canada is 5% of the purchase price. It is important to factor in closing costs when purchasing a home in addition to the down payment. A good estimate to have in mind for this is an additional 1.5% of the purchase price, this is also the number that many lenders use during qualification.
With a fixed interest rate mortgage, your interest rate does not fluctuate during the mortgage term and your regular mortgage payments do not change. With an adjustable rate mortgage, your interest rate changes when your lender’s Prime Rate changes. The payment amount therefore will change automatically to reflect the change in the interest rate. This means your payments may change from payment date to payment date.
A mortgage where the borrower’s down payment will be under 20% of the home’s purchase price will require mortgage loan insurance for which the premium is added to the mortgage.
Mortgage loan insurance is required by federally regulated lenders when homebuyers make a down payment of less than 20% of the purchase price. Mortgage loan insurance helps protect lenders against mortgage default, and enables consumers to purchase homes with a minimum down payment of 5%.
To obtain mortgage loan insurance, lenders pay an insurance premium. Typically, your lender will pass this cost on to you. The premium amount payable is based on a percentage of the mortgage.
CMHC is one of 3 companies in Canada that insures mortgages, the others are Canada Guaranty and Sagen.
The number of years or months over which you pay a specified interest rate. Terms usually range from six months to 10 years. The most common mortgage term is 5 years.
The choice of making your regular mortgage payments every week, twice a month, bi-weekly or monthly. Payments may also be “accelerated” which in effect means your payments are slightly increased to make the equivalent of an extra monthly payment each year. This reduces the overall amortization of you mortgage.
This is a feature offered by some lenders that allows you to move to another property without having to lose your existing interest rate. You can keep your existing mortgage balance, term and interest rate plus save money by avoiding early discharge penalties.
A stated rate by the lender that is used as a reference for variable or adjustable rate products. Ex. If you get at variable mortgage at Prime minus 1%, and prime is currently 6%, your mortgage rate will be 5% until prime changes.
Mortgage renewals are subsequent term agreements to the initial mortgage that either maintain or shorten the amortization period of the mortgage and do not increase the principal amount. At renewal you can either sign a new agreement with your current lender or move to another lender.