MUST HAVE A GOOD MORTGAGE LENDER IN YOUR POCKET
It is important to know, especially, for buyers that may or may not have sufficient equity in their existing home to purchase and then sell later. Some buyers are not aware of this fact that they can actually hold on to the property they own and take the equity out of it to purchase the new property. Your old residence becomes the rental property and you can deduct the interest on the mortgage from then onwards.
New and experienced buyers need to shop around for good rates, your banking institution may not be offering you the best rates after all. Here are some questions you may want to ask your current lender.....
1. What is the accurate outstanding balance of my mortgage effective the next first day of the month?
2. What is the mortgage penalty if I have to pay this mortgage out and can I port this mortgage to another property with a higher amount?
3. Do you have a copy of my RPR (Real Property Report), if you do not have a copy in your purchase records.
4. Do I qualify for an amount of mortgage for the new property? Do I need to sell my house to purchase the new property or can I buy first and then decide if I want to sell my existing property or can it be converted into a rental property if the market conditions and the location of the property allows you to do that?
5. What is the best fixed rate you can offer me today and what is my commitment period for this rate?
6. Ask about 1 to 5 year discounted rates and what is a fully open floating rate? Sometimes the floating rate mortgage is the best option depending on the market conditions.
If you are purchasing a home with less than 20% down, you will likely require a mortgage insurance from either CMHC (Canada Mortgage and Housing Corporation), Genworth Canada, and Canada Guaranty.