Did you know? The majority of Canadian mortgage consumers typically opt for Fixed-Rate Mortgages? More specifically, those with 5-year terms. This is largely in part because these are the most successful/profitable products for Lenders.

Although 5-year Fixed rate Mortgages are Popular and the Interest Rates are very attractive, it doesn’t necessarily mean that this is the best product for a particular individual. In fact 66% of all 5 year Fixed Mortgages are broken 2.7 years into the 5 year term.

Before deciding on a Mortgage Term Length and Product, always ask your self a few questions:

1. Where do I see myself in 1 year, 2 years, 5 years etc.?
2. Will I have more kids?
3. Will I be retired?
4. Will I have to move to a new city for my career?
5. Will I still bein my current relationship?

These questions are important because it will really qualify what Mortgage Product you need. In other words, if your planning on moving to another city or buying a bigger house in 2 years, then you will not want to commit to a 5 year Fixed Mortgage. When Fixed Mortgages are broken, very often Pre-Payment Fees will apply which can be catastrophic to your Financial well being. These Penalties or fees can be in the Tens of Thousands of dollars. I personally have seen them upwards to $47,000.

So, perhaps a shorter term Mortgage might be better for your life or even a Variable rate Mortgage.

Always seek a Mortgage professional’s advice and be sure to be as Transparent as possible. It could mean a world of difference when your Life unexpectedly changes.

As always, reach out anytime!!

Tom Parent “ing” you to Better Financial Solutions

phone: (519) 301-5149

email: tom.parent@domionlending.ca

#fixedratemortgages #mortgageadvice #mortgageprofessional #mortgageagent #mortgagebroker

Did you know?

Using a Mortgage Broker can:

1) Save you time when it comes to applying to lenders.

2) Often result in a better Mortgage rate than a bank.

3) Ensure unbiased advice and greater choice of Mortgage Product.

4) Save you money as we are compensated directly by the lender and most of the time there is no cost to the customer.

5) Find Mortgage solutions that banks don’t want to deal with such as bruised credit or high debt load.

As Canadians , we are very Institutionalized. We have been taught by our Parents before us to think that we go to the Bank for Money. We view banks as Institutions of Trust where we can “rest assured” knowing we have left our most feared worries and concerns are in the hands of extremely capable individuals and Officers.

The Reality is that Canadian’s and Mortgage seekers the World over, are becoming more and more used to the idea of dealing with Mortgage Brokers for the reasons listed above. I often tell my clients, “If you need Insurance, you go to an Insurance Broker, If you need to buy Stock, you go to a Stock Broker because they do the work for you.” That’s right, I go shopping to 115 different Lenders to find the right Mortgage Solution for you while developing the Mortgage Strategy that best suits you life.

In most cases, people think that Mortgage shopping is buying a rate or getting the best rate but they couldn’t be more wrong. Rates work on a sliding scale that the Mortgage shopper must qualify for. The determining factors are 1) Loan Amount to Property Value Ratio. 2) Credit Rating/Score. 3) Income to Debt Load ratio. After we have determined this, we look to a Mortgage Product that suits each individuals needs and situation.

In addition, the biggest thing that we Mortgage Brokers take Pride in and what sets us apart from the Banks, is our concern for our Clients well being. It is absolutely prudent that a Mortgage Professional digs deep into your current life and future life plans by asking these questions. “Where do you see yourself in 5 Years or 10 years? Will you have more kids? (Upsize), Will your kids move out of the house? (downsize), Will you retire? Will you job or career take you to another city? All these questions have serious impacts on the mortgage product that should be selected for you. If these questions are not answered, the results could be absolutely Catastrophic. I recently heard a story on the News where a fellow was charged a $47000 penalty by one of the major banks because he sold his house. Had these very simple questions been asked, this fee could have been very simply avoided.

I can’t tell you the number of times I have heard someone say “I wish I would have talked to a Mortgage Professional” or ” I am so glad I reached out to you because I almost made a very bad mistake”

signing off for now.

As always, call me or reach out with questions.

Tom Parent”ing” people to better Mortgage Solutions