Mortgages and Down Payments

Mortgages and Down Payments

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Purchasing a home is probably the largest financial decision you will make in your lifetime. As part of Committed II Excellence, the Chris Pennycook Team can provide you with sound advice regarding mortgages and down payments. Should you require professional financial advice and services, we can recommend a trusted group of bankers and mortgage brokers who will be happy to answer your questions and help in any way they can.

Pre-Approval

A mortgage pre-approval is an important first step in obtaining a mortgage for two reasons:

1. A pre-approval gives you a good idea of how large a mortgage you can afford.
2. A pre-approval also provides you with a rate guarantee for up to 120 days (subject to change), protecting you from the possibility of rate increases.

Your mortgage pre-approval will be based on the information you provide as well as your supporting documentation.

The most important factors lenders consider when deciding whether to qualify you for a mortgage are:

  • Income
  • Debts
  • Employment History
  • Credit History
  • Property Value

Having a pre-approval means that you can take your time shopping for your new home, knowing that the discussed payments are guaranteed for four months.

Down Payment

Today, there are many flexible options for down payments. Yours may include funds from your own savings, investments, the sale of property, or gifts from an immediate family member. A mortgage with a down payment that is less than 20% is considered a high ratio mortgage and must be insured by either CMHC or Genworth Financial. The larger your down payment, the less CMHC/Genworth insurance premium fees that you will pay.

Closing Costs

It is important to remember that there are individual costs associated with purchasing a new home. These may include land transfer taxes, lawyer fees, and moving expenses. Part of our service is to go over these closing costs with you so that when it comes time to meet with a lawyer for the closing of your transaction, you will know what to expect in regards to the closing costs.