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Mortgage Information for Ontario, Canada

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1. Mortgage Information for Ontario, Canada 2. Mortgage Information for Ontario, Canada 3. The Best Mortgage Information in Ontario, Canada 4. General Home Mortgage Information in Ontario, Canada 5. Things To Consider When Applying For A Mortgage In Ontario, Canada Find out more at: – PowerPoint PPT presentation

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Title: Mortgage Information for Ontario, Canada


1
Mortgage Information for Ontario, Canada
2
Synopsis
  1. Mortgage Information for Ontario, Canada
  2. Mortgage Information for Ontario, Canada
  3. The Best Mortgage Information in Ontario, Canada
  4. General Home Mortgage Information in Ontario,
    Canada
  5. Things To Consider When Applying For A Mortgage
    In Ontario, Canada

3
Mortgage Information for Ontario, Canada
  • The Difference between Canadian and U.S. Home
    mortgages
  • With the standard mortgage term in the United
    States being a 30-year fixed term the mortgage
    terms in Canada are five-years which is due to
    be remunerated every five years over the course
    of a twenty-five-year term. This requires the
    balance on the mortgage to be re-calculated and
    financed at the end of each five-year period.
    This five-year re-financing requirement gives the
    buyer the possibility of having their interest
    rates increased according to the current interest
    rate. If the buyer has the plan to prepay their
    mortgage at the end of this prepayment timeframe,
    they face the chance of very high penalty rates.
  • A mortgage in Canada is portablemeaning if you
    relocate to another home within the five-year
    term, you can request to use the prior mortgage
    from the other home for the new home. However, if
    the new home is more expensive than the prior
    residence, you will have to take out a second
    loan to cover the deference.
  • In Canada, the interest you pay towards your
    mortgage is not tax deductible as it is in the
    U.S. illuminating the incentive to over-borrow.
  • What is probably the most significant difference
    between Canadian and U.S. mortgages is that the
    Canadian banks supervise mortgage terms in a
    sounder manner than the U.S. does. The mortgage
    system in Canada is more similar to the way the
    U.S. handled mortgages during the 1970s. The
    Canadian banking regulations necessitate that
    banks keep loans on a balance sheet which
    discourages any lost due to underwriting
    standards.

4
Mortgage information for Ontario, Canada
  • There are two basic rules of affordability that
    you must be able to meet in order to qualify for
    a mortgage in Ontario, Canada and those rules
    are
  • Monthly shelter costs are not over 32 of your
    total monthly gross income
  • Debt ratio (including the mortgage cost) is less
    than 40 of your monthly gross income
  • If you dont qualify for a mortgage once you get
    to this stage of the process do not fret about
    it too much. There is plenty of time for you to
    get where you need to be by working with debt and
    credit counselors which are trained to aid people
    like you in preparing to qualify for a mortgage.

5
The Best Mortgage Information in Ontario, Canada
  • What do you do if you get declined for a
    mortgage?
  • If the bank advises you that you have no credit
    history and cannot qualify for a mortgage at this
    time, do not despair. There are ways you can
    start working towards establishing a qualifying
    credit history open up a small credit card and
    start paying the bills on time each month, using
    the credit available in a responsible manner.
    You can also take out a loan at the bank just
    ensure you make payments on time, or this could
    affect your credit negatively.
  • Many banks will also want you to cover a portion
    of the homes costs. For instance, with a
    conventional mortgage loan in Canada the bank
    covers 80 of the price for the property and the
    borrower is required to come up with the
    remaining 20.
  • If you have been declined a mortgage by a
    conservative bank or trust company, there are
    other options. There are private lender
    financing loans available to give borrowers a
    second chance at getting a mortgage loan funded.

6
General Home Mortgage Information in Ontario,
Canada
  • If you want to find the best mortgage deals in
    Ontario, you have to consider the terms and
    conditions. You have to know the difference
    between various types of mortgages closed or
    open, fixed or variable and methods of
    prepayments.
  • Closed mortgages have lower interest rates and
    most people opt for this. However, the amount in
    which you can prepay is restricted. You will
    incur interest penalties if you overpay. On the
    other hand, in an open mortgage you can pay as
    much prepayment principal as you can in a year.
    You can do this if you are anticipating a large
    sum of money in the near future.
  • Fixed mortgages are the most preferred mode of
    financing, because most customers have a fixed
    budget. It has a set interest rate that stays
    constant during the mortgage term. Variable
    mortgages have a lower interest rate but
    fluctuate during the mortgage term, because they
    are tied to the market rates.
  • In Ontario, to purchase a home, you are required
    to pay a down payment of 5 minimum. You should
    note that there is a maximum price restriction.
    To obtain a mortgage, you are required to produce
    a proof of your income, have a good credit
    rating, a verifiable down payment and an online
    approval application. You are required to meet
    other costs such as legal fees, survey
    certificates and appraisal fees.
  • For the down payment, you are allowed to pay
    using either, your accumulated savings, a gift
    from your immediate family, proceeds from selling
    of previous home, or your registered retirement
    savings plan. The retirement savings plan, is not
    taxable if paid within the designated period of
    time.

7
Things To Consider When Applying For A Mortgage
In Ontario, Canada
  • The Mortgage Period and Amortization
  • Prospective home buyers are often confused about
    the two terms. The mortgage period refers to the
    time period that you are committed to the
    mortgage rate, the terms and conditions of the
    mortgagee. The mortgage amortization refers to
    the time you take to pay for the whole mortgage.
    In Canada, most mortgages have a 5-year term and
    a 25 year amortization period. You are required
    to pay a down payment of 20 for homes with more
    than 100000 in worth and 5 for homes of lesser
    value. For homes with less than 20 worth of down
    payment, the amortization period is 25 years and
    35 years for homes with a higher value.
  • How To Determine Mortgage In Ontario
  • You will have to consider a number of factors
    when computing the amount of mortgage and monthly
    payments. Some of these factors vary across
    different provinces in Canada depending on where
    you are acquiring your home. The factors that are
    applicable in the Canada include the amortization
    period, minimum down payment, mortgage default
    insurance or the CMHC. These parameters are fixed
    by the ministry to guard the buyers from the
    lenders and brokers.

8
The End
  • For more details, please visit
  • https//mortgagesolutionsgroup.Ca/

Yonge Street Richmond Hill, ON, L4C 3B9
Canada 1-888-233-6164 info_at_mortgagesolutionsgroup.
ca
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