| Q. |
What is a mortgage broker? |
| A. |
Your mortgage broker is an independent Real Estate financing professional who specializes in the origination of residential and commercial mortgages. |
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| Q. |
Why use a mortgage broker? |
| A. |
Brokers provide consumers with choice, convenience and expertise.The consumer receives an expert mentor throughout the entire lending process.
Each applicant’s needs and qualifications differ greatly, a Mortgage Broker who is familiar with the different programs available and knows which questions to ask, can approach lenders that best meet your needs while the single lending institution will attempt to sell you only their limited products. Mortgage Brokers are service orientated and save you time and money while shopping for the best mortgage for you.
CMC offers the consumers extensive choices and access to flexible and affordable mortgage loans while balancing the consumer’s financial interests and goals. |
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| Q. |
What will using a Mortgage Broker cost me? |
| A. |
Most often, CMC will not charge you a fee. We are generally paid a finder’s fee by the Lender. Only in certain circumstances would you be charged a fee – and you will ALWAYS be informed before this happens. |
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| Q. |
What if I have bad credit or have been turned down before? |
| A. |
No problem, deal with a professional broker who knows the lending criteria of Canada’s mortgage lenders. We place mortgages for slow credit, no credit, former bankrupts and just in foreclosure. Let a professional package and place your application. |
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| Q. |
What about Home Equity Loans for fast cash? |
| A. |
If you have built up equity in your home beyond your original down payment, you may be able to tap into it and obtain affordable and flexible financing.
Equity loans are an excellent source of cash to pay off high interest credit card debt, home improvements…
Banks, Trust Companies and Credit Unions can lend up to 90 per cent of the appraised value of your home. If the current amount of your mortgage is less than that, you could use the extra equity to obtain a homeowner’s line of credit. This is one of the least expensive sources of financing available. At Calgary Mortgage Corp. we have lenders offering equity lines of credit, we will tailor a plan to suit your needs. |
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| Q. |
What is a beacon score? |
| A. |
A beacon score is the result of a complicated numerical system used by Equifax, the credit reporting firm most widely used in Canada, to rate your credit history. The score will range from 300 – 900. The median score is 650. If your score is higher than 650 you will have many mortgage options available and if it is lower then your options are limited. Some programs are only available with scores of 680 or higher. |
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| Q. |
What negatively affects my beacon score? |
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- If you are close to or over your credit limit on your credit cards.
- If you miss a payment
- If you have collections, bankruptcy, consumer proposal
- If you have made many credit card inquiries
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| Q. |
How can I repair my credit? |
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- Keep balances on credit cards under 70% of the credit limit
- Pay off collections
- Make regular payments on your credit cards even if it is just the minimum payment
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| Q. |
What is a mortgage term? |
| A. |
A mortgage term is the length of time the bank is willing to lend you the mortgage amount at a certain interest rate. |
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| Q. |
What is a mortgage amortization? |
| A. |
A mortgage amortization is the length of time it takes you to pay the mortgage amount off in full. The common amortization period for a mortgage is 25 years but you can also get 30, 35, and 40 year amortizations. |
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| Q. |
What’s the difference between a Pre-approval and an Approval? |
| A. |
A Pre-approval is basically a Conditional Approval. You want a Pre-approval when you have not yet made an offer on a home, but want to know what you can afford to purchase. A Pre-approval will also provide you with a “Rate-Hold” (usually 90 to 120 days) – a guarantee that your interest rate will not go above the current rate. If interest rates decline, most lenders will give you the lower rate. A Pre-approval will also generally give you a list of the information and documentation that the lender will need to see before the mortgage can fund. This helps to ensure that there are no unpleasant surprises at the last minute.
An Approval is in place only after you have made an Offer to Purchase on a particular property and it has been accepted. An Approval may still have some conditions attached, so you will still need to allow time for the conditions to be met. 5-7 business days is typically enough time. |
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| Q. |
What’s involved in getting a pre-approval? |
| A. |
Complete a mortgage application
CMC processes the application: this involves credit history enquiries as well as calculations on income and debt servicing ratios, down payment available, etc. CMC at this time will approach appropriate lender(s).
Whenever possible, CMC will obtain a formal Conditional Pre-approval Commitment. This will provide a guaranteed maximum interest rate for a 90 to 120 period, along with a list of conditions. Typically conditions include income verification (letter from the employer and a recent pay stub or a copy of an employment contract) confirming employment is not probationary, confirmation of down payment funds available and from the clients own resources (i.e. Non-borrowed funds), and in the case of non-Canadian resident clients, a copy of credit references (i.e. UK Experian report, letters of reference from a bank or other financial institution, etc.). In some circumstances, an appraisal of the property will also be required. |
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| Q. |
What happens next? |
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Find a Realtor – if you don’t know one, CMC can arrange an introduction to some of the best in the business.
Once a property has been located, and an Offer To Purchase (subject to a Condition of Financing) has been accepted, CMC will typically have 5-7 business days to meet all of the conditions the Lender has imposed on the offer of financing. Once all of the conditions are met to the satisfaction of the Lender, the Financing condition can be waived. Once all conditions from the Offer To Purchase are waived, the purchase is deemed to be a Firm Sale.
Typically 2 to 3 weeks prior to Possession date, the lawyer will receive instructions from the Lender, along with documentation. At this time the lawyer’s office contacts the Purchaser in order for the documents to be signed at the lawyer’s office. Once all documents are signed and filed with the Land Titles office, the lawyer will request funds from the Lender to be transferred into his Trust Account. Funds will then be transferred from the Purchaser’s lawyer to the Seller’s lawyer’s Trust Account either on or just prior to, the Possession Date.
Once funds are transferred, the sale is complete, and the Purchaser can take possession of the home. |
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