Whether you are a first time home buyer or you are moving up to your second or third home applying for a mortgage can be filled with anxiety of the unknown.
Questions like:
· Will I qualify?
· How much can I afford?
· What paperwork do I need?
· Will I understand everything?
· Fixed or Variable which is best for me?
· How will I know I get the best rate?
A mortgage specialist can answer your questions professionally and provide you with explanations to common terms and mortgage scenarios. The first step to applying for a mortgage is a conversation to understand your needs and wants.
Needs analysis is more than where you live and work or how much you make but evaluating factors such as your risk tolerance. Are you the type of person who would lay awake at night wondering if interest rates are going up or down? If you are, your mortgage professional would consider finding the best fixed rate option for you instead of variable rate mortgage.
Just as the name implies Fixed term mortgages have interest rates which remain constant throughout the term of the mortgage. Whereas a variable rate mortgage will fluctuate as the banks’ set their variable rates based on what the Bank of Canada has set their rate. Long-term averages have shown that in most cases the variable rates on average are lower in a five year term.
Other factors include where you are in your work cycle, the beginning, middle or close to retiring. If you have children or are planning to have children; essentially the more conversation you have with your mortgage specialist the better understanding s/he will have to meeting your needs and expectations.
Common to every mortgage application are these basic paperwork needs:
- Credit Authorization form – your permission to start an application and do a credit bureau check.
- Most Recent pay stub for all applicants (must be within 30 days)
- Notice of Assessment – 2 years (for hourly & commissioned employees, bonuses or self-employed)
- Down Payment Confirmation – e.g. 30 days bank statement or recent RRSP statement of account.
- Confirmation of other income sources – e.g. Investment income, Child support, Pension or Disability.
If you currently hold a mortgage but would like to tap into your equity either by adding to your current mortgage or with a Home Equity Line of Credit additional information will be required:
- Recent Mortgage Statement
- Most recent Property Tax Statement (with Paid receipt or Tax Certificate – call city for this & fax directly to my number)
- Estimated Value of Home supported by either a recent BC Assessment or MLS listings of recent sales.
- Legal names of all parties as seen on the current title of the property to be financed.
When you have found the right mortgage specialist you will know because many of your questions will be anticipated and answered even before you even knew what to ask!
Although every mortgage application is unique the commonality is the relationship created by your mortgage professional that nurtures an open dialogue to help relieve stress and increase your confidence in the mortgage process.
Anne
Manager Residential Mortgages
TD Canada Trust
C: 604 996 8388
Filed under: First Time Home Buyers, Mortgage Planning | Tagged: Finance, First Time Home Buyer, Mortgage Advice, Mortgage Planning, TD Canada Trust
