Frequently Asked Questions.

You trust a specialist for your vehicle, health, and finances, so why not trust a specialist for your mortgage?

Our team of Mortgage Agents is licensed by provincial jurisdiction and trained to find YOU the best mortgage. Whether that’s freeing up more cash for your day-to-day expenses or finding you the absolute best rate based on your financial history, our goal is always to find the best solution for you.

While banks and other financial institutions have access to products like bank accounts and mutual funds, we have access to many lending options. We can secure financing from well-known banks or from non-traditional lenders.

We are based in the region of Ottawa and provide bilingual services throughout the province of Ontario.

The time from initial application to closing varies from application to application. The initial meeting with your broker is a quick process, usually taking no more than twenty minutes.

After your initial meeting, your broker will send the application to a lender for approval. Depending on the lender, an approval or denial can take anywhere from 24 to 72 hours.

Once approved, the client must provide all the necessary documents to meet the lender's requirements. A list of the most required documents can be found on our website.

Once all documents are received and approved by the lender, all broker conditions are said to be lifted. This essentially means that you have met all the conditions set by the lender. Once this step is complete, it usually takes at least 10 business days to sign the final documents with the lender, as well as any required legal documents with an attorney. Once these formalities are completed, the funds will be sent to the individual on the closing date.

Overall, the mortgage process can take anywhere from a few weeks to a few months, depending on the situation.

When buying a home, you need to prove and demonstrate that you can make your regular mortgage payments if interest rates rise in the future. The mortgage stress test involves applying a minimum qualifying interest rate to your intended property value to determine your eligibility.

In June of 2021, the minimum qualifying interest rate is 5.25% or the rate offered by your financial institution + 2%, whichever is higher. So, if your lender offers you a rate of 3.14%, you will have to use the 5.25% qualifying rate in your stress test. If your lender offers you a rate of 3.39%, you will use the qualifying rate of 5.39%.

The qualifying rate in terms of calculating future mortgage payments is to help protect the home buyer. The protection ensures that they can afford the future mortgage payments as mortgage rates are likely to increase through that period. So, although a home buyer may have a principal and interest payment at 3.14% if they purchase today, they will know that they can afford a potential interest rate.

Not sure if you can pass the mortgage stress test at the home price you're shopping for? Let us know! Let's book some time to chat with one of our agents and get you one step closer to homeownership.

In Canada, fixed mortgages are by and large the most popular loan type among homebuyers. In essence, a fixed-rate mortgage is a straightforward loan payment plan where the interest rate is locked in place from beginning to end. Fixed rates ensure constant, steady payments, which is ideal for applicants with a strict or set income.

A fixed mortgage rate works in contrast to a variable mortgage rate. The rates in variable mortgages are not fixed in place like their counterparts. Instead, variable rates fluctuate periodically, according to market conditions.

Since variable rates are subject to go up or down, homebuyers can save money when rates drop. On the other hand, there is always the risk that rates go up, and applicants should be prepared financially to handle a price increase.

Fixed mortgages are an ideal choice for applicants with a set or tight budgets because the stable nature of fixed mortgages makes it easy to budget each month. With a fixed rate, you have the peace of mind knowing precisely how much and how long it will take to pay off your loan in full.

Fixed or variable? Send us a message to find out what mortgage structure is best for you!

The interest rate of a variable rate mortgage fluctuates over time. The rate is based on a benchmark interest rate that changes periodically, usually the prime interest rate. Variable rate mortgages are also known as “adjustable or floating rate mortgages.”

If you have a variable rate mortgage, you’ll benefit when interest rates decline as interest charges drop. Depending on how much interest rates rise, you may conversely pay more than someone who negotiated a fixed rate during the same period.

If you’re looking to refinance your mortgage at a lower rate, send us a message! An agent on our team would love to book some time to chat!

Have you ever wondered how your interest rate is calculated?

For new mortgages, lenders set the interest rate for the amount they’re proposing to lend to you. To assess their rate, they consider the following factors.

- the length of your mortgage term

- their current prime and posted interest rate

- if you qualify for a discounted interest rate

- the type of interest you choose (fixed, variable or a combination)

- your credit history

- if you’re self-employed

Lenders use the prime interest rate to set their posted rates. The prime rate is established by the bank of Canada and is currently 2.45%.

Most mortgages that use a variable interest rate are comprised of the prime rate plus a percent. For example, you may be offered a rate at prime plus 2%. When the prime rate is low, variable rates are favourable for consumers. But as prime rates increase, you may end up paying more in interest on a variable rate mortgage than a fixed-rate mortgage.

If you haven’t purchased a home before, you may be eligible for rebates and tax credits from the federal, provincial, and municipal governments.

Eligible homebuyers can claim a $750 credit through their income tax claim on the year they bought their home.

Eligible first-time homebuyers can apply within 18 months of purchase for a rebate of up to $4,000 from the Ontario government and $4,475 from the municipality of Toronto (if home purchased within the GTA).

You can now draw up to $35,000 as an eligible first-time home buyer from your RRSP as an interest-free loan to assist with the down payment of the property. Once borrowed, you have 15 years to repay the amount in full.

A down payment is a lump sum of money that a buyer places on the purchase price of a home. The remaining balance is financed through a mortgage or other form of a loan.

For example, a buyer purchasing a home for $400,000 may put a 10% down payment on the purchase price of $40,000. The buyer would then look to obtain the remaining $360,000 from a mortgage agent in the form of a mortgage. If the home's purchase price is under $500,000, you may be eligible to put as little as 5% down.

If you can place 20% of the purchase price or more as a down payment ($80,000), then you would avoid paying mortgage insurance fees and therefore lower your overall financial obligations by doing so.

Ready to make your first down payment but not sure where to start? Send us a message, and an agent on our team can book some time to chat!

Buying a home in today’s market is an exhausting process. With the low inventory level, you can expect to make offers on multiple homes before you finally have an accepted offer. Just when you think you’ve completed the process, it hits you, closing costs.

Closing costs can range anywhere from 2-5% of the purchase value of the property. Here are some of the most common costs incurred on closing.

Appraisal – Before lenders agree to extend a loan, they’ll want to verify the value of the property being purchased. As a buyer, you are responsible for paying for the appraisal, which typically costs $400-500.

Home Inspection - While not mandatory, home inspections are highly recommended. Most realtors will include a home inspection clause in their contract to give buyers a chance to have the home scoped out by a professional to uncover any major, minor and latent problems that may not have been noticed during the initial walk-through. You can estimate anywhere from $300-700 to have a home inspected.

Lawyer fees- In a home sale, there’s quite a bit of paperwork exchanged between the buyer and the seller, so a lawyer is necessary to have the required documents prepared. Expect to pay around $500 on legal fees.

Deposit- To make an offer, a deposit that counts towards your down payment is required. This shows the seller you’re serious and committed to buying their property.

If you’re purchasing a home with a down payment of under 20% of the purchase value, you’ll need mortgage loan insurance from the Canadian Mortgage and Housing Corporation.

Mortgage insurance protects your lender in case you can’t make your mortgage payments. Your down payment can be as little as 5% of the purchase price with mortgage insurance!

To get mortgage loan insurance, you’ll need a minimum down payment. The amount depends on the home’s purchase price:

- If the home costs $500,000 or less, you’ll need a minimum down payment of 5%.

- If the home costs more than $500,000, you’ll need a minimum of 5% down on the first $500,000 and 10% on the remainder.

- If the home costs $1,000,000 or more, mortgage loan insurance is not available.

Questions on CMHC mortgage insurance and what it means for your next home purchase or refinance? Give us a call.

While most of the purchase value of your first or next home will be paid overtime, each lender requires a cash down payment. A down payment is the amount of money you are putting towards the purchase of your first or next home, while your lender covers the rest of the home value, which you’re responsible for paying back over time.

Ready to start looking for your next home but unsure of how much cash you’ll need for a down payment? Send us a message!

Are you making multiple payments monthly for outstanding debt?

If you are, you understand the confusion that comes with ensuring that you make all your monthly payments on time.

Did you know through a mortgage refinance, we could consolidate all or most of your debt into your mortgage?

High interest debt from credit cards or loans is often impossible to catch up on. By grouping your outstanding debt with your lower rate housing payments, you’re saving on interest payments and time.

Have you been turned away from getting financing because you’re self employed?

At Today’s Mortgage Choice, we understand that as a self-employed individual, you declare your earnings in a different way than typical applications. But that doesn’t mean you shouldn’t be able to qualify for a mortgage.

If you’re self-employed, know that you have options.

Whether it’s putting more down to avoid traditional third-party validation of income or evaluating options from non-traditional lenders, we’ll help find a solution that works best for you!

If you don’t have excellent credit, you may have heard of a subprime mortgage. A subprime mortgage is a mortgage offered by a ‘B’ lender. Standard term mortgages are provided by ‘A lenders,’ which primarily include big banks or recognized financial or credit institutes.

Subprime mortgages typically feature less than favourable interest rates and terms but are sometimes the only options based on your credit score.

A second mortgage allows you to access your home equity without selling your home. It’s an additional loan that a homeowner can take out on their home. The loan can be used freely, but the primary mortgage and secondary mortgage must both be repaid together. To qualify for a second mortgage, your property must be of a certain value.

The amount that can be taken out on a second mortgage depends on the value of the property and the amount owing on the existing mortgage. Usually, a homeowner can take out up to 80% of the home value.

Although taking out a second mortgage can result in fast cash, you are also taking on a much greater financial responsibility. Before committing to a second mortgage, or additional financing on your existing mortgage, you should consult a licensed professional.

If you’re looking to free up some additional funds to meet immediate financial obligations, let us know and we can book some time with one of our agents to chat and help you get closer to financial freedom!

When you’re going through a major life change like a divorce or separation, it’s important to seek advice and consider your options on any joint lending. If you and your spouse are both on the deed, there are alternatives to selling your home or property.

If you’re amid the process of separation, a joint mortgage can be transferred to a single person by buying the other out of the mortgage. In some cases, lenders may even help consolidate debts to assist with affordability. A spousal buyout can help a family avoid any further disruptions and excess stress that come with having to sell a home.

When one owner buys the other’s share of home equity, the co-owner is released from the mortgage contract, and they are removed from the deed. This way, the family may maintain some stability during the separation.

If you’re in the midst of a difficult time for you and your family, give our team a call or send us a message. We’d be happy to help you get back, financially independent.

Did you know you may have to pay a penalty to pay off your mortgage early?

A prepayment penalty is a fee that your lender may charge if you:

- pay more than the allowed additional amount toward your mortgage

- break your mortgage contract

- transfer your mortgage to another lender before the end of your term

- pay back your entire mortgage before the end of your term, including when you sell your home

If you have an open mortgage, you can make a prepayment or lump-sum payment without paying a penalty.⠀

Prepayment penalties can cost thousands of dollars. Part of our job is to help you navigate prepayment penalties if you want to sell or refinance your home. If you’re thinking about paying off your mortgage early, give us a call, and an agent on our team can look at what your prepayment would be and how much you may still save in a refinance.

Did you know there are times you can avoid penalties when putting additional funds towards your mortgage?

A prepayment privilege is an amount you can put toward your mortgage on top of your regular payments without having to pay a prepayment penalty.

Your prepayment privileges allow you to:

- increase your regular payments by a certain percentage

- make lump-sum payments up to a certain amount or percentage of the original mortgage amount

Prepayment privileges vary from lender to lender.

When we finance your mortgage, we'll help you go through the terms and conditions of your mortgage contract to find out:

- if your lender allows you to make prepayments

- when your lender allows you to make prepayments

- if there's a minimum or a maximum amount that you're allowed to prepay

- what fees or penalties apply

- if there are other conditions

Most lenders limit the allowed prepayment amount per year. Typically, you can't carry a prepayment amount from one year to the next. This means you usually can't add the amount you didn't use in previous years to the current year.

Your credit score is a number that evaluates your creditworthiness. It can be viewed as your credit report card, grading you on how you’ve repaid loans in the past. Your credit score can range from 300 - 900.

With a credit score in the 700 - 900 range, finding a lender is a lot quicker and easier. Each lender has different criteria on what score they will lend to, so the higher the score, the more options you have.

It’s important to know that your score will change over time. Just because you checked it a few months ago, doesn’t mean it will be the same when we check it when applying for a pre-approval.

The two biggest things that influence your credit score are the amount of debt you have, and the number of late payments you make. The more debt and the more late payments, the lower your score will be.

Want to check your credit score? Send us a message or give us a call and we can book some time to go over your credit report card!

A lender will use your credit score to determine if they will lend you money and how much interest they will charge you to borrow it. Your credit score is a number calculated from the information in your credit report. It shows the risk you represent to a lender compared to other consumers.

Knowing your credit score before applying for a mortgage can help predict the rates and terms offered by various lenders.

You can order a copy of your credit report from both Equifax Canada and TransUnion Canada for free in writing. Ordering your credit report does not affect your credit score.

Equifax Credit Report Form > https://bit.ly/EQFCreditReport

TransUnion Credit Report Form > https://bit.ly/TransUCreditReport

Send us a message or give us a call and we can book some time to go over your questions. We are happy to help!