Buying a home can be one of the most momentous events in a person’s life that can require a lot of effort, but getting an appropriate mortgage can help you focus on the pleasure of owning a home.
In short, yes. Very few lenders are prepared to offer a 100% mortgage even if they might have done in the past. The state of the economy in Canada at any given time will often dictate how the lender will act and what they are prepared to offer. Accordingly, when the economy isn’t as healthy as it could be, it will be impossible to find a mortgage that doesn’t require a deposit.
The deposit will be a percentage of the total purchase price that typically ranges from 5% to 20%, but is dependent on your circumstances.
The annual percentage rate (APR) represents the annual cost of borrowing a sum of money in the form of a percentage.
The percentage will vary according to the lender and the type of mortgage that you take out. However, it will be clearly outlined in any quotation you are given.
This is a possibility, though you will need to check the contract terms in any mortgage offer that you obtain. There is often a penalty involved if you deviate from the terms of the mortgage contract, such as failing to pay an installment on time, which can include early repayment.
A fixed rate mortgage will have the same APR throughout the term of the mortgage, whereas that for a variable rate mortgage will change according to Canada’s prime rate. The latter is usually calculated according to a certain difference, such as 1% above prime rate.
The APR of a fixed rate mortgage will not change no matter what the prime rate does. However, there is the potential for a variable rate mortgage to increase or decrease.
The advantage of a fixed-rate mortgage is cost-certainty – you know that your rate or monthly payment will not change throughout the term. With a variable rate mortgage, you face the risk of increased payment if rates go up throughout your term, but you benefit by having a lower rate initially – which may stay lower for the entire term, depending on market conditions.
A mortgage broker will have access to a range of products and providers that are not available to a consumer directly, which can mean more choice for you. This can often come with better deals that you might not be able to find yourself.
A broker also has the skills and experience necessary to work efficiently and prevents the need for you to do the legwork to find what you need.