The mortgage industry has changed tremendously over the last five years. If you’re a first-time homebuyer, looking for a second mortgage, or you’re self-employed you want to get the best mortgage rates in Canada. First, you must understand how the mortgage industry works.
When applying for a mortgage you should do your research, including:
- Comparison shopping
- Find out and/or improve your current credit score
- Use a mortgage affordability or payment calculator
A number of qualifying factors are considered when you’re being considered for a mortgage. Since mortgage rates have a tendency to vary, these factors assist lenders to determine the best mortgage rates for you, and make sure you qualify for the mortgage itself.
A mortgage professional wants to help you in minimizing your monthly payments and interest rates as much as possible. If you are well-prepared, than your mortgage broker will be too.
Comparison Shopping
Before hiring your mortgage broker, it’s always a good idea to do some comparison shopping yourself. One of the most common and best ways to start your search is to start with your local yellow pages. A yellow page listing provides a lot of vital information about possible lenders, such as:
- Phone number, directions, email, and website information
- Hours of operation
- Product/service lists
- Recognitions and/or awards
- Customer reviews
- Payment methods accepted
- Other vital information you may need (Mortgage Brands, Specialties, Languages, etc.)
It’s always great to hear about other positive customer experiences and see awards of public recognition that a brokerage has received throughout the years. This shows that you can trust them.
Find Out Your Credit Score & How You Can Improve It
Today the mortgage industry lends on a tiered pricing basis. This means that depending on the current criteria, your mortgage rate may be adjusted as required. The higher your score the better your interest rate will be. Having a lower score does not mean you will not qualify, but you can expect to being paying a slightly higher interest rate and down payment.
If you are concerned about paying a higher interest rate based on a low credit score, you can improve your chances of getting the best mortgage rates possible by starting to monitor and repair your credit. Fixing your credit can take some time, but if lenders see that you’re making an effort this will go a long way too. Here are a few tips to help you improve your credit now:
- Keep any current loans from defaulting – make your payments on time every month
- Review your Equifax and TransUnion credit reports for any installment accounts, revolving accounts, and new or past-due collection accounts
- Get in touch with the collection agencies to make payment arrangements
- Review your credit reports for any potential errors and file a dispute to have them removed or updated (if necessary)
Determining If a First or Second Mortgage Is in Your Budget
With the world-wide web there are tons of great mortgage tools that can help you to determine the affordability of your new or second mortgage, such as these:
Using either of these calculators will help you to make a wise decision regarding your purchase. We understand that throughout any buying process questions always arise, no matter how much research you do, you can get in touch with AKAL Mortgages to discuss your mortgage needs at any time. When we say YES! We stand behind our promise.
