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Whats what with mortgages?

April 26, 2017asset allocation bonds Consultants Financial Planning investments mortgages Mutual funds Stock Market stocks

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Whats what with mortgages?

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Here’s a mortgage primer to get you going. Get pre-approved. Many people want the security of knowing they have a pre-approved mortgage before they go house shopping. If you decide to do this, make sure your rate will not increase if rates rise, but will be automatically reduced if they drop. The down payment decision. Conventional mortgages do not exceed 80 per cent of the purchase price of a house – you supply the other 20 per cent as a down payment. If you don’t have that kind of cash on hand you can apply for a high ratio mortgage, which could cover up to 95% of the purchase price of the house, but it must be insured through Canada Mortgage and Housing Corporation (CMHC) or GE Mortgage Insurance Canada (GE). Your monthly payments will definitely be much higher so consider this option carefully. Becoming ‘house rich and cash poor’ can cause significant money and emotional stresses. Amortization – shorter is better. Amortization is the number of fixed payments or years it takes to re