Are you thinking of buying a Condo? It’s a big commitment, one that shouldn’t be taken lightly. Getting your mortgage approved may well seem like the most difficult step on the road to your dream home, but amidst finding the best mortgage rates don’t forget a few tips in order to avoid potential pitfalls.
So you took the time to search for your dream property and fell in love with a condo in the heart of Toronto. You made sure you’re at a walking distance from Arts, culture, leisure and entertainment. You picked an urban chic street with quick access to trendy boutiques and restaurants. You knew what you were looking for and found it!
However, now is the time to work on funding your purchase through a mortgage! Start your search by comparing Mortgage rates in Ontario from multiple brokers. While the cheapest monthly payments might seem like the easiest option, this isn’t true because an offer that seems great is probably offset by fine print. Here we will look through some tips to help you identify your perfect mortgage.
- Lump sum payments – So you think you will be able to pay down your mortgage aggressively? There’s always a clause that limits the maximum amount you can pay on your principle per year. It can range from 0% to 100% and come with little or several conditions. Make sure you are comfortable with the maximum amount you are allowed to payoff on the principle without earning yourself a penalty.
- Initial Deposit – Initial deposits can be as low as 5%. However, you should try to size up your down payment to 20% in order to save off extra fees and lower your monthly payments. If you can afford it, you would reduce the amount you need to borrow as well as the insurance premium.
- Finding the right lender – Mortgage brokers are sales people, everyone you speak to will sound like the best deal. Take your time in getting multiple quotes and compare the best mortgage rates. Investigate the details of each offering prior to signing!
- Acceleration clause and foreclosure – You may be pretty confident that you’ll be able to make each payment, but how do we know that this will still be the case in a few years? If this is hidden in the fine print then any missed payments could lead to the bank calling in the loan, and if you can’t adhere to this then a foreclosure may be requested and your home sold at auction.
- Variable rate mortgage – This is a big risk for anyone taking out a mortgage. If the market works in your favour you can save thousands and if it doesn’t you can lose your home. A variable rate means your rate will changes with the prime lending rate and you can be paying different amounts of interest during the year. If you think you won’t be able to afford a rise in interest rates, focus on finding the lowest 5-Year Fixed Closed Mortgage Rates with Rates.ca, a site offering the Best Mortgage Rate in Canada. A fixed rate will guarantee your peace of mind for the length of the term.
There are so many turns that a mortgage can take that it can get too much to know if you have the right deal. Avoid signing up for the lowest mortgage rate without knowing what that entails, mortgages can be a crazy maze. But if you keep your wits about you, you’ll come out with money in your pocket and the property of your dreams.