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There's more to getting a mortgage than finding the lowest mortgage rate. In fact, the best mortgage is the mortgage that offers you the options, flexibility and mortgage interest rate that you can live with and this is precisely where Kanetix.ca can help you. Through Kanetix you can compare the mortgage rates for a variety of mortgage products and terms. Rates are updated as they change and are displayed in an easy to compare format to help you in your search for the best available mortgage rate.

1st mortgage options: Fixed rate mortgage loan or variable rate mortgage loan?

There are two types of mortgage interest rates and for your first mortgage you may be asking yourself: Should I select a fixed mortgage rate or an adjustable mortgage rate? Both options have their pros and cons:

Fixed rate first mortgage

Fixed rate mortgages have interest rates that are set and will remain the same for the entire term of the mortgage. With a fixed rate mortgage, your mortgage payments remain constant so you know exactly how much you will pay every month.

With a fixed rate mortgage, you are protected from interest rate increases and can better control your budget. You will know exactly how much of your income will go towards your mortgage.

Your mortgage payments are broken down into "Principal" (amount of the loan owed at any specified time, not including interest) and "Interest" (the fee you pay for having borrowed money from a lender).

Since your monthly mortgage payments do not change with a fixed rate mortgage, if you have a first mortgage rate of 2.8 per cent with a 3-year term for example, the portion of your payments that go towards the principal of your loan will stay the same for the duration of your home loan (3 years), no matter how high or low interest rates go.

Variable rate first mortgage

Variable rates could change many times over the course of the term of your mortgage. The effect of changing rates will depend on the lender or the mortgage you obtained.

For example, if your lender's interest rates change-let's say they increase, then the amount of your mortgage payment that goes against your principal will decrease. If rates decrease then more will be applied to your principal because you will be paying less in interest. If your payments are not fixed, then as rates rise and fall so too will your payments.

1st mortgage options: Open mortgage or closed mortgage?

As a first time homebuyer in search of your first mortgage, you will also need to decide if the mortgage you choose will be an:

Open first mortgage

With an open mortgage you can pay off the balance at any time, or apply extra cash to the outstanding loan, without incurring any penalties or extra charges. A fully open mortgage loan typically has a higher interest rate than a closed mortgage home loan, because you can pay it off or reduce the balance by any amount at any time.

Closed first mortgage

A closed mortgage loan typically has a lower interest rate than an open mortgage although it too may allow the occasional additional payment, as per your lender's discretion. Basically a closed mortgage cannot be renegotiated, or refinanced before the mortgage term reaches full maturity without some sort of additional charge.

Great first mortgage resources

The following are great resources for first time homebuyers looking to get their first mortgage:

• Deciphering mortgage language; what's it all mean?
• Tips to pay off your mortgage sooner
• Looking to buy a house to make your home? A primer on mortgage loans
• Canada Mortgage and Housing Corporation
• Home Buyers' Plan
• Financial Consumer Agency of Canada
• View today's mortgage rates

This summary is for informational purposes only and should not be relied upon without verification by contacting a mortgage professional.

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