the mortgage process
TRANSCRIPT
The Mortgage Process
2011Robert Lumb
The Mortgage Process - Simplified
Step 1. – Mortgage Pre-Approval
Step 2. – Shopping for your home
Step 3. – Mortgage Application
Step 4. – Subject Removal
Step 5. – Legal Process
Mortgage Pre-Approval
• Protects your negotiated rate up to 120 days.
• Determines the price range of your new home.
• Makes the purchase process smoother.
Qualifying• Must have at least 5% down of purchase price - a limited number
of programs still offer 100% financing.
• First time home buyers may be eligible to use their RRSP’s for a down payment.
• Mortgage Payment + taxes + heating costs* < 32% of gross monthly income.
• Monthly debt including Mortgage payment < 42% of gross monthly income.
• You must be able to pay closing costs of at least 1.5% of purchase price.
• Credit history• Lenders will obtain a credit report which identifies your overall credit
standing
Shopping for Your New Home
With your mortgage amount Pre-Approved, you and your realtor are able to shop
for the home that best suits your needs.
Preparing an OfferYour Offer or Agreement Will Include:Basic details
• Your legal name.• Name of vendor.• Legal and civic address of property.• Purchase price• Conditions
It is recommended using a qualified Realtor and/or seeking the advice of a
lawyer before finalizing.
Mortgage Application
An Invis Mortgage Consultant will help you:
• understand your mortgage options
• identify documents required for speedy application approval, ie: employment and down payment verification, survey certificate and appraisals
Mortgage Application Mortgage Options
Open Mortgage
• Repay the loan without penalty.
• Interest rates can be higher.
• This may be a good choice if a client is planning on selling their home in the near future.
• Lenders will usually allow conversion to a closed mortgage at any time.
Mortgage Application Mortgage Options
Closed Mortgage
• Offers terms from 1-10 years fixed rates
• There are often penalties or restrictive conditions for prepayments or additional lump sum payments.
• May not be the best choice if you might move before the end of the term.
Mortgage ApplicationMortgage Options
Variable Rate Mortgage
• Variable/Adjustable interest rate tied to prime
• Generally convertible to a fixed rate mortgage. At times a penalty may be charged
• Most Variable Rate Mortgages are for 3 or 5 year terms
Mortgage ApplicationMortgage Options
Terms & Payment Options
• Terms from 6 months to 18 years, amortizations up to 35 years. Some lenders offer up to 40 year amortizations on conventional financing up to 80%.
• Flexible payment options• Weekly• Bi-weekly• Monthly
Mortgage ApplicationMortgage Options
Other Options
• Bruised credit? There are options for you.
• Financing through “B” lenders with varying mortgage programs.
• Private Lenders available for unique situations.
• Up to 100% financing.
• No income verification products.
Associated Costs
• Some common costs of buying a home:• Appraisal fee• Land transfer tax or PPT• Survey / title insurance• Legal fees• Home inspection• Property taxes• Fire insurance
What a Lender Wants:Personal Info
• Age, marital status, birthdates, dependentsDetails of Employment
• Proof of Income• T-4’s• Notice of Assessments• Letter from employer
• Other sources of income• Pensions• Rental income• Investment income
What a Lender Wants:Other Financials
Current banking information• Name of Financial Institution.• Average cash balance of account(s).
Verification of down payment• 3 months of bank statements showing account holder name and
account number.
Consent to complete credit investigation (Invis Client Agreement)
What a Lender Wants:Assets & Liabilities
Assets• Property• Vehicles• Investment Account
Balances• RRSPs• RESPs
Liabilities• Credit Card Balances• Personal Loans/Vehicle
Leases• Total amount owing &
monthly payment amounts
What a Lender Wants:Property Details
• A copy of the property listing
• A copy of the Agreement of Purchase & Sale for a resale home
• Appraisal of property
• Plans and cost estimates on a new home
• Condo financial statements, if applicable and strata minutes included AGM
• A certificate for well and septic, if applicable
Subject Removal & Legal Process
Once all conditions have been met and the subjectsremoved the lender will forward all documents to thelawyers where the mortgage and title transfers aresigned
Working With an Invis Mortgage Consultant
• We act as liaison between the lender and the borrower.
• At Invis we are independent, which means we offer unbiased advice and have the client’s best interests in mind.
• Our primary role is to determine the financial needs of our client and find the mortgage products that best fulfills their needs.
An Invis Mortgage Consultanthas your best interest in mind
• We simplify the process of mortgage financing.
• We negotiate with lenders for the best possible products and lowest rates.
• We help you achieve your goals of home ownership.
• We have the experience and the expertise to work on your behalf.
• We know what mortgage products are available in the market.
About Invis
• Founded in 2000, Invis is one of Canada’s largest mortgage brokerage firms, with offices from coast to coast.
• We leverage our buying power to get the best service and terms for our clients.
• We save clients valuable time and possibly thousands of dollars when it comes to home financing.
Our Strengths & Specialties
• Provide maximum flexibility in financing choices.
• Provide counseling on credit & qualifications.
• Arrange & coordinate the mortgage closing.
• Assist with purchase, renewal, construction & renovation financing.
• Provide efficient & highly personalized service.
• For most clients there is no fee for our services – the lender pays for our fees.
• A fee may apply when working with a client with bruised or poor credit history.
Fees
Whether You Are:
• Buying a home?• Purchasing an investment property?• Restructuring debt?• Renovating?• Renewing your current mortgage?
Contact: XXXX
xxxxInvis Phone: (403) 555-5555Fax: (403) 555-555Email: [email protected]