ADOLFO PEDRAZAS
Sales Representative

Sutton Group - Quantum
Realty Inc., Brokerage
Independently Owned and Operated
 

IRINA JORDACHE
Sales Representative

Getting pre-approved shows your agent as well as the seller that you are serious about making a purchase. It is important to understand that getting pre-qualified is not the same as getting pre-approved. With a pre-approval, the lender takes into consideration your overall situation which includes making an analysis of your debt-to-income ratio and pulling up your credit history (prequalification is unofficial, and only takes into account your debt-to-income ratio).

• the comfort of knowing what you can afford before making an offer
• going through the process will help you understand how mortgages work and which programs and interest rates you qualify for
• you will be in a better position to negotiate with seller(s)
  • seller(s) may accept your offer over another if you are pre-approved
    and the other party is not

• Conventional Mortgage
  • a loan that does not exceed 75% of the purchase price or appraised value of the home, whichever is less
  • does not have to be insured against default
  
   
• High Ratio Mortgage
  • a loan that is above 75% and up to 95% of the purchase price or appraised value of the home, whichever is less
  • must be insured against loss by either the CMHC or GE Capital
  • premiums may be paid at closing or they may be added to the mortgage
  
   
• Open Mortgage
  • allows you the flexibility to repay the mortgage at any time without penalty
  • available in shorter terms, 6 months or 1 year only
  • the interest rate is higher than closed mortgages (higher by 1% or more)
  • choose this option if you are expecting an inheritance or if you are planning to move again
  
   
• Closed Mortgage
  • offers the security of fixed payment for terms from 6 months to 10 years
  • can offer as much as 20% prepayment of the original principal
  • penalty would be charged if you wish to pay off the full mortgage prior to its maturity
  
   
• Fixed-Term Mortgage
  • the interest rate is set for the term of the mortgage so that the monthly payment of principal and interest remains the same throughout the term
  • gives you the security of knowing that your interest rate and payments won't change during the chosen term
  
   
• Adjustable Rate Mortgage
  • interest rate changes usually on a monthly basis depending on the then current rates
  • typically, the mortgage payments remain constant, but the ratio between principal and interest fluctuates
  • when interest rates are falling, you pay less interest and more principal; if rates are rising, you pay more interest and less principal
  
   
• Equity Mortgage
  • mortgages that are assessed on the equity of the home (market value minus the mortgage amount)
  • usually up to 75% of the value of the property
  • more suited for people that do not meet the normal income and/or credit qualifying guidelines required by traditional banks

The material provided is for informational purposes only. Although the site owner and creators assume the information to be correct, and attempt to keep information on this website as current as possible, they do not warrant the accuracy or completeness of any information included in or linked to this page.