Bank Mortgage - How to get a mortgage

 
Unless you won the lottery this week, or the rich parent lottery when you were born, then likely you'll need a first mortgage at some point in your life.
To find the best mortgage rate you should have saved at least 5% which is the minimum you'll need to buy any home with CMHC Insurance.  
If I've lost you already, then follow this step by step guide on:
 

HOW TO GET A MORTGAGE LOAN

* Save your money - you'll need minimum 5% of the purchase price
* Save another 2-3% for closing costs including:
* Lawyers, Title+ Home Insurance, Moving, Repairs, CMHC and Miscellaneous
* While you're saving... Be good to your credit by paying all your bills on time - Your Beacon score should ideally be over 680, but not a requirement
* Your Mortgage Payment is dependent on Beacon Scores debt loads
* Pay down your debts, especially the higher interest credit cards
* Having debt is OK.  A specific debt ratio is used to qualify each client
* File your tax returns - lender will ask for your last two years 'Notice of Assessments'
 
I HAVE 5% SAVED + CLOSING COSTS... NOW WHAT?
* Find the best mortgage by shopping bank mortgages & broker mortgages
* Your credit is good, your debts are low & your employed. Banks will love you!
* If your self employed then you qualify after presenting Income Statements
* Ask me for the names of my preferred brokers to help you obtain a mortgage
* Don't stop - people stop asking when the bank says no...  there are many lenders that say yes despite bad credit or low income.
 
HOW MUCH WILL I PAY?
* If you followed the steps above, then you may apply for the Banks best mortgage rate.
* Interest rates are running between 2.79 -5.24% for 5 year fixed
* For the lowest morgage payment ,Your credit rating must be well over 700
* Amortization of the loan is 25 years with CMHC Insurance
* Without CMHC Insurance you'll need 20% downpayment & optional 15-40 year amortization
* The longer your amortization the less you pay monthly, But seek advice first
* Choose a Fixed or Variable rate mortgage - Seek advice first
 
HOW DO I APPLY?
* Call a Bank or Mortgage Broker to setup an appointment.
* I can provide 4 names who guide you patiently through the process
* Fill in the application, provide Notice of Assesments for last 2 years & Employment letter or your Income Statements.  Not Employed- There is still hope.
* You will be Pre-Approved or Pre-Qualified - The latter is better
* Once you're given the Pre-Qaulification letter then you'll know your price range
* Find a realtor that can guide you through the purchase process - Like me...
* Don't waste time looking at houses that don't fit your criteria.
 
In summary....
To get a Bank mortgage you will need three major components:  First is good credit.  The banks want to know you're a good credit risk before they lend you money.  
Second, you need to have a certain debt ratio.  The lower your debts the better your chances of being approved.
Lastly is your down payment determines if you'll need CMHC Insurance and if so, then you're maximum amortization period is 25 years.  

If you put down over 20% then you don't need CMHC Insurance and your amortization can be stretched over a longer period of time, thus making lesser monthly payments.  
Always seek professional advice and always be looking for promotional interest rates from Banks and Brokers.

Written by Miguel Burgos