Common Questions
What is the purpose of a pre-approved mortgage?
A pre-approval gives you the peace of mind in having an interest rate guaranteed (usually 90-120 days), and knowing the price range you can afford when shopping for your dream home.
How long does it take to get a mortgage approval?
Generally, a mortgage approval takes 1-2 business days to obtain. However, it depends on the lender and your specific situation.
What kind of paperwork do I need?
The paperwork needed to obtain a mortgage depends greatly on your unique situation. You will need to confirm your employment and income. This may be obtained from an employment letter and pay stub or by tax information. You will also need to confirm your down payment, whether it be from savings, RSP or sale of existing home. Your mortgage agent will let you know what paperwork will be required upon application.
Can I borrow my down payment?
Programs have been introduced recently that help clients with good credit history buy a house with borrowed down payment. There are 2 programs; both depend on credit history and job stability, and also charge a higher insurance premium. The first is Genworth's Free Down Payment program. In this program, the bank supplies the down payment for you in exchange for a higher interest rate over the term of your mortgage. With this program, you must take a 5 year closed mortgage. The second program is CMHC's Flex Down Program. This program allows you to borrow the down payment from a credit card, line of credit or bank loan with a discounted rate. You can take any term from 6 months to 25 years. Both programs affect qualifiers differently; you and your mortgage agent should discuss the best option for your situation.
Why should I use you, I have a good relationship with the bank?
That is great to hear that you have a good relationship with your bank but most people use us because they want someone who represent them not the banks, they want the best interest rate and the best product suited to their needs. Whereby the bank and the person sitting across from you works for the bank and it is their job to get the best deal for the bank. You are limited to the products that your bank offers, which may not be the best products, suited to your needs.
I would like to pay my mortgage as fast as possible, what should I do?
Paying off a mortgage is a dream that many Canadians have and it is a good goal to strive towards. However, a better option would be to maximize your RRSP contributions. Once you have done this you can then concentrate on paying down your mortgage. In many instances you can contribute to your RRSP and take your tax refund and apply it to the mortgage as a pre-payment thereby, accomplishing both.
How are you paid?
Lenders pay mortgage planners a referral fee for doing the legwork on your mortgage. Lender do this because they save money by not paying their employees to handle your application. It saves you money as well because our planners secure rates and terms you wouldn't otherwise have access to, while adding no net cost to your mortgage.
Why should I deal with a mortgage broker instead of my bank?
Your bank is only 1 lender and therefore only has 1 set of rates and products to offer you. A mortgage broker has numerous lenders available to them. All these lenders compete for your business so they are offering the very best mortgage rates possible. Whether it is a Chartered Bank, Trust Company, Mortgage Lender or Private Mortgage Company, Western Canada Mortgage knows where the best rates can be found with the prepayment privileges that are important to you.
What is the difference between a co-signer and a guarantor?
A co-signer is registered on title with you. A guarantor guarantees the mortgage, and that the payments will be made. After a period of time, a guarantor can apply to CMHC/GE to be removed off title should the owners of the property be able to qualify on their own.
Is it mandatory to get Mortgage Insurance?
No. But sometimes it is a good idea to get either mortgage insurance or term insurance. Knowing that your house would be paid off if something should happen to you, gives you peace of mind.
