Kanetix Forum

I am looking to buy my first property and I have no idea what to look for in a mortgage. Can you please give me a small outline? Any information would be great!

When obtaining your first mortgage some key questions to be asked are:

"What will it cost me if I need to break my mortgage tomorrow?" ¿ The average person stays in their home 3.7 years

"What are my pre-payment options?" ¿ When you pre-pay your mortgage, the full amount goes directly to principal knocking tons of interest off your mortgage and allowing you to pay it off sooner.

"Are there any charges or fee¿s for pre-paying my mortgage?" ¿ Some companies have administration fee¿s for this. You don¿t want to spend $50 every time you want to put an extra $100 on your mortgage.

If taking a variable rate mortgage:

"Can I convert into a fixed rate at a later date?" ¿ With the outlook for variable rates to rise next year, you need a product allowing you to convert into a fixed rate.

"Is there a fee or charge for converting into a fixed rate?" ¿ Most companies do not charge a fee but you need to know in advance of signing for your mortgage.

"Will I be converting into the lowest possible rate (discount rate) or will I automatically be put into the "ceiling/posted" rate?" ¿ This question is huge as the difference between posted and discounted rates is usually greater than 1.5%

Paul Sidhu, Principal Mortgage Broker at KTX Financial Ltd.

Neither Kanetix® nor the KanetixForum.ca is a mortgage broker or agent. Although this information has been passed along to you from KTX Financial through the Forum, we are not responsible for the opinions expressed by them. Mortgages can be complicated. When reading these answers, keep in mind each person¿s situation is unique. Individual responses may vary depending on your lender, geographic location, and specific circumstances. If you have a similar situation, always speak with your mortgage provider, or a licensed mortgage representative, for terms and conditions that may apply to you.

This is great list to reference. Thanks Paul!