FAQ

Here are some Frequently Asked Questions that we get and hopefully they will answer some of the questions you may have when looking at a Mortgage from TMA.

Mortgage Types

An open mortgage allows you the flexibility to pay off some or all of the mortgage at any time, without a penalty. Interest rates are usually higher and are tied to the Bank Prime.

A closed or fixed mortgage offers you the security of locking in your interest rate for the term of your mortgage, so you know exactly how much principal and interest you will be paying on the mortgage during the term. Terms range from 6 months through to 10 years.Many lenders will allow prepayments of up to 20% of the balance annually without a penalty. If the mortgage is paid off in it’s entirety before the end of the term, most lenders will collect a fee of three months interest or charge the lost interest to the end of the term.

A variable rate mortgage allows you to take advantage of today’s low Prime Rates. The interest rate fluctuates in relation to the ‘Prime Rate’. Lenders compete by offering various discounts below the prime rate. Payments may be fixed for up to 5 years although the rate of interest will always fluctuate according to Bank Prime. If the Prime rate climbs you pay more interest and if the prime rate descends you pay off more of the principal.

Why use a mortgage broker?

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That’s easy…a broker works for you not the bank.  They will work along side you to ensure you get the best rate and product for your situation.  A broker has access to over 50 different lending institutions including most of the major banks and a number of lenders you only have access to through a lender.  The broker channel can be very completive so the discussion is not about rate at all but what is best for the client and their situation.

Why get pre-approved?

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In today’s real estate market you have to be ready to act.  In discussion with real estate agents they prefer clients get pre-approved to ensure they can show them homes in their budget.   Once the process starts everyone is ready to act to ensure you get your dream home.

What Documents Do I Need?

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Every mortgage is a little different.  After your broker has a chance to complete a full analysis of your situation they will be able to better inform you of what documents will be required.  Gernerally, you will need 2 recent paystubs, a letter of employment, a copy of your offer and MLS listing to get started.

What Determines the Rate that we pay?

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Rate is dependent on a number of variable including but not limited to…you personal situation, credit history/rating, type of product, and a few others that your broker will be able to guide you through.

 

If you have any other Questions feel free to contact us!