Mortgages

The right one depends on how long you plan to stay, how steady you want your payment, and how soon you might pay it off. Here are the four kinds you will hear about.

Fixed rate

The rate is set for the whole term, so your payment does not change. Terms run from six months to ten years, and five years is the most common. Breaking a fixed mortgage early can carry a larger penalty.

Fits when you want the same payment for years.

Variable rate

The rate moves with your lender’s prime rate. Depending on the mortgage, your payment changes, or the share of it that goes to interest does. The penalty to break it is usually three months of interest.

Fits when your budget can take a payment that moves.

Open mortgage

You can pay off part or all of it at any time, with no penalty. The rate is higher in return, and terms are short, often six months or a year.

Fits when you expect to sell, or to receive a large sum, soon.

Home equity line of credit

A line of credit secured by your home. You borrow what you need up to a limit, and pay interest only on what you use. The rate moves with prime, and the line can reach 65% of the home’s value.

Fits renovations and other costs spread over time.

Today’s rates

Posted every day by The Mortgage Group, beside what most banks post. Your own rate depends on your file, so ask me for it.

Call or message me for today’s rates.

For information only. Rates can change without notice and are compounded semi-annually, not in advance. “Our best rate” applies to insured, high-ratio purchases. Source: TMG, through BrokerTools.

Words you will hear

A few terms come up in almost every mortgage conversation. Here is what they mean.

Term: How long your rate and conditions are set, usually one to five years. At the end you renew, or move to another lender.
Amortization: How long it takes to pay off the whole mortgage, usually 25 years. A longer amortization lowers the payment and raises the total interest.
Closed mortgage: Most fixed and variable mortgages are closed. You can pay extra within set limits, and paying it all off early carries a penalty.
Insured mortgage: With less than 20% down, the mortgage must carry default insurance. The premium is usually added to the loan.
Prepayment privileges: How much extra you can pay each year without a penalty. It varies by lender, often 10% to 20% of the original loan.
Portability: Lets you take your mortgage, rate included, to a new home if you move during the term.

What decides your rate

The board shows the best posted rates. Yours depends on a few things I check on the first call.

Your down payment, and whether the mortgage is insured.
Whether you are buying, renewing or refinancing.
The term you pick, and fixed or variable.
The length of your amortization.
Your credit history.
Your closing date, since a rate can only be held for so long.

How much can you afford?

Seven calculators work it out on Canadian rules: payment, affordability, rent or buy and more. Then book a call and I will check the numbers with real lenders, at no cost to you.

Open all seven calculators Book a 15-minute call

Book a 15-minute call

Tell me a little about your situation and I will get back to you. My service is always free for you.

Tyler SomersMortgage Agent

1841 Laurier Street, Rockland, Ontario 613 890-2241 tyler@beat-banks.com @tylersomers97 Monday to Friday, 9 a.m. to 5 p.m.Saturday and Sunday, 9 a.m. to noon

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