Mortgage Pre-Approval

A mortgage pre-approval allows for the home buyer to know their borrowing power. It is a great option for those looking to buy a home to get an idea of what price range they can afford. Applying for a pre-approval is very easy and absolutely free. The great thing about pre-approvals is you are not obligated to the lender or mortgage broker from whom you received the pre-approval from.
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What is Rent To Own?  How does it work.

For clients who cannot qualify to get a mortgage to purchase a home, the Rent to Own Program maybe the solution for them.  The program allows the client to enter into a contract with an real estate investor where they move into the property they want to buy and pay the investor rent until they are ready to purchase the property form the real estate investor.  Here is an example.
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Typical process for a renewal is you will receive a letter in the mail anywhere from 120 to 30 days prior to your maturity date. The bank will offer you a rate that may be lower than the posted rate but is typically much higher than the current market rate. Most of us will sign the renewal and send it back just to avoid the hassle of more paper work, but is that the best option for your bank account.
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There are two different types of mortgages for self-employed borrowers. One is based on qualifier income (proof of income on paper) and the other is non-qualifier income (no proof of income on paper). There are big differences in lender policy based on each type of borrowers.
Borrowers who qualify based on provable income:
Once you are self-employed the mortgage broker or lender will ask to see your last two years Notice of Assessment Income Tax Return. The income on these documents is averaged out over a two year span. This income is then used to qualify for your mortgage. If the income is enough to support the mortgage you need, then you as a borrower, can put down as little as 5% for a purchase, refinance up to 80% of your property value, purchase rental properties, and even access secured lines of credit. You are treated just like a borrower on salary or hourly income.
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A Home Equity Line of Credit or HELOC, is a secured loan against your home. This is just like a mortgage but with the features of a line of credit. It is completely open(paid down at any time without penalty) and is also revolving (can be paid down and then used again). The loan is always available until closed out. A Secured Line of Credit can be added alongside a mortgage as s separate product. For example, if a client has equity in their home a lender will allow the client to borrow up to 80% of that equity when adding on a secured line of Credit. This can be applied on the purchase or refinance of a home.
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If you asked your bank representatives how are fixed and variable mortgage rates calculated and did not know how to answer your question, what would you think? If you asked your bank representative how they calculate their fixed rate mortgage penalties and they did not know, would you still want to work with them? Majority of people still do.

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Appraisals

Appraisal is simply an expert opinion from a state-licensed professional on how much the value of the property really is. An appraiser uses many factors when determining the property value. They do a full detailed report and explain on how they came up with the property value. The first step is to physically examine the property inside and out to see which features bring up the value. They also look at location and recent sales around the property at question and provide anywhere from 3-4 comparables in order to better determine the value. These properties have to be very similar to the property being appraised; to specific components such as: lot size, square footage, garage type, finished or unfinished space, etc.
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Subprime (B) and private lending options available to clients.

In Canada there are three lending tiers.   The top tier or A lending as it sometimes called refers to clients who can qualify on income and credit and go through banks and other A type lenders.  This type of lending would represent the majority of mortgage lending in Canada.  There is however two other lending options available to consumers, B and private lending.  This source of lending represents a large portion of the overall Canadian mortgage lending market.
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The current market rates are low and definitely to take advantage of. Here are a few mortgage tips you may want to consider with your current mortgage and save money for the future.
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