A mortgage broker (agent) is a licensed professional that will work with multiple lenders to find you a mortgage to suit your needs. They are not employed by any one lending institute which means they are working for you, not the branch.
They have access to numerous lenders and mortgage products. When you choose an Axiom Mortgage Solutions broker you will have the power of our negotiating power behind you which means the best rates and terms will be made available to you. There is usually no fee to work with a mortgage broker (if you qualify under standard lending guidelines). We are paid by way of a commission paid by the lender. Should a fee be required this is disclosed and documented up front.
Some of the costs associated with obtaining a mortgage are legal fees, appraisal, home inspection, and utility hook-ups. Please see costs for further information or better yet, contact us to discuss your personalized mortgage plan.
Your mortgage is insured when you have less than 20% to put as a downpayment on your purchase. By law, lending institutions cannot lend more than 80% of the value of the home unless it is insured by CMHC (Canada Mortgage and Housing Corporation), Canada Guaranty or Genworth.
These insurers protect the lender against the default of a mortgage. The insurance is put in place, a premium is charged and this amount is added to your mortgage. A non-insured mortgage is when you have 20% or more to put as a downpayment. In most cases, there is no insurance premium charged. Occasionally, the lender may still need to have the mortgage insured through CMHC, Canada Guaranty or Genworth depending on the location of the property or type of property being purchased.
Once you find a home, you and your real estate agent will write an offer to purchase. Once the negotiations have been completed, a copy of the offer to purchase and property highlight sheet is forwarded to your mortgage broker. They then submit the mortgage for final approval to the lender. Once the lender/insurer approval has been obtained, the lender will send a mortgage commitment to your mortgage broker outlining the details of the approval along with any paperwork that may still be required. Your mortgage broker will then contact you to go over the approval and ask you for the paperwork required to complete the mortgage file. Once the paperwork has been received and approved by the lender, your mortgage file will be complete and you can remove your “subject to financing” condition on your offer to purchase.
Once you have removed all of your other conditions, such as “subject to home inspection”, then you have purchased your home! Your next step will be to go to your lawyers to sign the legal paperwork required in order to complete your purchase. You should expect to go to the lawyers approximately 10 days prior to the possession date. When you go to your lawyers, you will be expected to bring the remaining down-payment and closing costs. These funds must be in the form of a certified cheque or draft. Once you have completed the paperwork at the lawyers, you will then wait to take possession of your home on the possession date negotiated.
Getting a mortgage pre-approval is important for many reasons:
It’s important to know what purchase price you qualify for before you go shopping for a home. Allowing you to stay within both your budget and the amount of loan you will get approved for.
A pre-approval will provide you with the opportunity to review what you can comfortably afford; taking into account not only your mortgage payments, but the other costs of owning a home such as property taxes and utility bills. If you have not owned a home before, these amounts may be a bit surprising.
Your mortgage broker will help you take a look at the entire picture. Online calculators are great, and crunching the numbers on your own is a good start. Using an Axiom Mortgage Broker will ensure you will qualify for a mortgage based on the lenders criteria. If there are issues, it is better to discover them at the pre-approval stage so that you and your mortgage broker can work together on fixing those issues prior to your search for a home. If you are not able to qualify for a mortgage at this time, we can assist you in taking the steps necessary to qualify for a mortgage in the future
It is important to note that a pre-approval qualifies you as the applicant. Your mortgage broker will have confirmed your income, credit and down payment at this stage.
However, we are not able to pre-approve the property you will be purchasing. This is subject to lender/insurer approval. Therefore, it is important that you always put a “subject to financing” condition on your offer to purchase. Your real estate agent will assist you in writing the offer to purchase.
A pre-approval is only valid if there is no material change in your financial situation. If something has changed since you received your pre-approval (i.e. change in job, acquired new/addition of debt etc), please contact your mortgage broker to complete a review of your file.
