Motgage 101

Starting the journey to home ownership or looking into the possibility of upgrading your current home is an exciting time. Whether you’re preparing financially, searching for the right mortgage, going through the mortgage process or looking for savings a mortgage broker is a valuable resource.
With all the options available in the mortgage market place you need a professional to guide you to the right product to meet your borrowing needs. Mortgages have changes tremendously over the years with new options and lenders coming and going. You need to be informed and prepared and a professional mortgage broker is definitely the right resource to use. Here are a few hints to help your mortgage approval process run smoothly. If you’re looking for a professional mortgage broker to guide you call Kevin MacGregor with Homes Loans Canada at 403-852-2908.

Determine how much you can afford: Based on your down payment, income, existing debt, regular expenditures and other key financial information a mortgage broker can help you determine how much you can afford to pay every month and the price range that will work within your budget.
Get pre-approved…properly: Pre-approval and pre-qualification are different, the pre-approval process is a more formal process you will need to provide 3 key pieces of information; your income verification, proof of funds available for your down payment and your credit report. The three key ingredients allow your mortgage professional to determine your budget and credit worthiness.
Be Organized: By having all of your paperwork and information organized, your lender can make and easy analysis to determine what you can qualify for. With all the changes in the mortgage lending market it is important to have all your ‘duck’s in a row’. Being well qualified will save you heartache when you find a home you love but find that your funding is insufficient to purchase it.
Understand your credit rating: The mysterious credit rating is something most buyers don’t completely understand. Canada has 2 credit agencies Equifax and Trans Union; either of these agencies can generate your FICO score, commonly known as your credit score. Equifax Canada uses a range of scores from 300-900. Generally for credit qualifying lenders are looking for a higher number. Lenders will consider applications for the best rates with scores ranging from 580 or more. Below 500 means you have some missed payments, collections and credit difficulty. Your mortgage professional can offer you advise to improve your score as this will qualify you for better rates. If your score is in the mid range from 540-650, you are doing OK but may have some minor blips in your credit report. 650+ means you will qualify under most lender and mortgage insurance programs. You can obtain your own credit report online for a small fee at www.equifax.ca. It might be worth checking your current credit rating if you are thinking of buying in the next year so that you can try to improve your score if necessary.

Next Week Organizing your Documents