What is an Oshawa Mortgage?

As the location of the General Motors Canada, Oshawa is a well-established province that provides a high quality of living to both current and new residents. Though part of the Census Metropolitan area, commuters are attracted to Oshawa because of the low cost of housing and the availability of GO Transit. The province is implementing a plan to develop an extension to Highway 407 and is making improvements to the Oshawa Airport to expand its capabilities, which means any property purchased now will appreciate considerably over time. (See First Time Home Buying Tips)

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Unless you have significant financial resources, you'll need to take out a mortgage to purchase a home in Oshawa, Ontario. A mortgage is a loan from a financial institution that covers the difference between the cost of the home and any down payment you have saved. However, it is possible to take out loans for more than the mortgage amount and use the difference to pay off debts, finance a college education, conduct home improvement projects, or apply to other expenses. These loans can be obtained from a number of sources including mortgage brokers, credit unions, chartered banks, and trust companies.

Critical Information About Mortgage Loans in Oshawa

The interest a lender charges for a mortgage loan is called the mortgage rate. When you make payments on your loan, a portion of the money goes towards paying the accrued interest while the rest is applied to the mortgage principal. The money that's applied to principal is the only thing that reduces your loan balance. Since the interest charged is based on the principal amount, the amount of interest you pay lessens each month also.

Most people believe they should chase after the lowest mortgage rate. That is not always wise. There are a few other things you should consider when deciding which loan offer to accept.

  • Rate Hold Period - A lender will guarantee a rate for a period of time. Banks that have longer rate hold periods can help you avoid sudden rate increases.
  • Prepayment Limitations - Otherwise known as closed mortgages, this option lets pay a fixed percent of your mortgage each year. For example, 1 percent of the total amount due could be paid the first year. The percentage rate can be increased each year providing you with some flexibility in paying off the loan.
  • Amortization Period - This is the amount of time you have to pay off the loan. The time is based on individual circumstances, but some lenders offer longer amortization periods than others.

Getting the Best Mortgage Rate in Oshawa

There are so many loan types available, that it can be challenging to find the best one for you. KANETIX has access to a wide array of loan rates from a variety of mortgage brokers and lenders. You'll be able to search for and compare Oshawa mortgage rates for with ease. In addition to that, KANETIX offers special discounts to the people of Oshawa. Our partnerships with companies allow us to offer competitive mortgage rates to Oshawa customers, which translates into thousands of dollars in savings for you.

Whether you want a first mortgage, second mortgage, to refinance your mortgage, or get a mortgage renewal we can help. Using our Oshawa mortgage calculator, we can determine how the loan amount, amortization period, and payment frequency affects how much your mortgage payments will be. We can show you how much interest you'll pay and how much money you can save by changing from a monthly to a bi-weekly payment schedule. Our service is easy to use and offer benefits such as:

  • Ability to search by different variables like payment type, rate type, and loan term
  • View loan rates offered by brokers and mortgage lenders
  • The service is free, safe, quick, and easy

When you're ready to lock in your rate, simply fill out our online application or call us directly. Our friendly agents are ready and waiting to help you find exactly what you need.

Four Types of Oshawa Mortgages: Open, Closed, Fixed, and Variable

At KANETIX, you have your choice of four different loan types:

  • Fixed Rate Mortgage - This is a fixed rate that doesn't change throughout the loan period.
  • Variable Rate Mortgage - The mortgage rate on this loan adjust with the prime lending rate. If the rate goes up or down, so does your interest rate.
  • Open Mortgage - These loans allow you to pay them off at any time with no penalty.
  • Closed Mortgage - These loans restrict the amount of money you can pay on the loan each year.

Choosing the best fixed rate or variable rate loan for you depends on your personality and preferences. Fixed rate mortgages are best for people who don't want to worry about unexpected rate hikes, while variable-rate mortgages are more for gamblers who can weather increases for the chance at getting a really low rate in the future.

Similarly, an open-rate mortgage is good for people who want the option to prepay their loans early, while closed-rate mortgages are best for those who expect to have the same cash flow throughout the life of the loan. It should be noted that some closed-rate mortgages will increase the amount you are allowed to pay in any one year, so they do offer some flexibility.

To find a mortgage loan that fits your budget and lifestyle, use our comparison service to find the best Oshawa mortgage, Oshawa mortgage lenders, Oshawa mortgage brokers, Oshawa mortgage rates, and Oshawa mortgage deals.

High Ratio vs. Conventional Mortgages in Oshawa

Mortgages in Oshawa and other Canadian Provinces are classified as either conventional or high-ratio. The difference between the two is the amount of your down payment or the amount of equity in your home when refinancing. If your home equity or down payment is 20 percent or more of the property value, then your loan will be categorized as a conventional one. Anything less than 20 percent and your loan will be listed as a high-ratio mortgage. You will be required to obtain mortgage default insurance that will cost anywhere between 1.75 to 2.75 percent of the loan amount.

To learn more about convention and high-ratio mortgages, visit these helpful websites:

  • Genworth Capital
  • Canada Guaranty
  • Canada Mortgage and Housing Corporation

Mortgage Brokers in Oshawa

Kanetix works with some of the biggest mortgage brokers in Oshawa to obtain the best home loan rates available. Take your time perusing available rates and then give us a call or contact us online when you're ready to lock in your loan. Visit our loan rate comparison page for more information about Oshawa mortgage lenders or contact our friendly agents for assistance.

Factors that Influence Getting the Lowest Mortgage Rate in Oshawa

Lenders consider a number of factors when deciding which loan rate to offer including:

  • Credit Score: Some loan companies base the rate they offer people on their credit scores. The better your score, the lower your rate.
  • Mortgage Time - The time period you secure your mortgage can affect the rate. For example, if you close within 30 days, you may get a discount.

Always be honest about the information you give lenders. This will ensure your application is processed in a timely and efficient manner. In addition to providing access to Oshawa mortgage loan rates, our comparison service can be used to get rates for other areas including Ontario, Manitoba, Nova Scotia, Prince Edward Island, Saskatchewan, New Brunswick, and Newfoundland.

General Information About the Province of Oshawa

  • Population (2011 Census): 149,607
  • Population Makeup (2006 Statistics): White 89.7%, Black 3.8%, Other 6.4%
  • Population Change between 2006 to 2011: 5.7%
  • Median Income (2005 Statistics): 72,329 CAD
  • Unemployment Rate: 6%
  • Inflation: 1.6%

Source: CityStats

The Oshawa Real Estate Market

  • Average Home Price: $276,818
  • Current Prime Rate: 3%
  • New Home Starts: 419

Sources: MetropolisIQ

This summary is for informational purposes only. Current information can be obtained from a real estate professional.

Mortgage Trends in Oshawa Ontario

Oshawa is the largest urban centre in one of the fastest growing regions in Canada (Durham Region). It's a community that is ideally situated on the Highway 401 corridor just 60 kilometers east of Toronto. Oshawa is a town of about 150,000 residents and is the eastern anchor to the Greater Golden Horseshoe and the Greater Toronto metropolitan area. Many residents enjoy a quiet life living along the shores of Lake Ontario while also enjoying the comforts of being close to the largest city in the country. With all that the area has to offer its residents, it certainly lives up to its motto of, "Prepare to be Amazed." Many people are planning to move into this lovely community in the near future, and others who already live in Oshawa may be planning to buy or sell real estate soon. While it can be difficult to accurately predict what may happen in the real estate and mortgage markets, recent factors can be strong indicators that individuals can look to before making a buying or selling decision.

Mortgage Rate Trends

Mortgage rates in Oshawa have followed suit with the rest of Canada in recent years. After the economic downturn in 2008, Canadian mortgage rates for a five-year fixed rate reached 3.69 per cent at their lowest point. This is compared to about 7 per cent in November 2008 before the economic crash. The interest rates for residential mortgages remained low for several years, but there has been a recent trend with increasing rates. In July 2013, for example, the five-year rate had increased by 20 basis points from the previous month. Rates for other mortgage loan programs have also increased in recent months. Rising mortgage rates are a sign that the economy is stabilizing, and the rate increase has been relatively slow. Rates are projected to continue to slowly increase throughout 2014, although they are expected to remain far below the level they were at in 2008.

The Average Sales Price

According to the Toronto Real Estate Board, the average sales price of residential real estate sold in the second quarter of 2013 was $285,024. The average sales price of real estate for the last quarter of 2012 was $259,432. This appears to reflect an increase in property values. However, it is important to note that the number of listings during this time period was significantly different, and because of this, the average sales price figures may reflect the fact that more affordable or smaller homes were in higher demand or were more available in the marketplace in the fourth quarter of 2012 than in the second quarter of 2013.

The Number of Listings

The number of active listings on the market in the second quarter of 2013 in Oshawa was 326. This is compared to a total number of active listings of 254 in the fourth quarter of 2012. In addition, new listings for the second quarter of 2013 were 1,210 units, and this is compared to 637 new listings in the fourth quarter of 2012. Some of the differences in these figures may be related to seasonal market fluctuations, and warmer months of the year generally do yield a greater number of real estate transactions. However, the increasing number of properties on the market in recent months may also be due to the fact that interest rates are rising. Many who have had plans to list their property for sale or to upgrade their home may have been on the fence while interest rates remained low. With the rise in interest rates, they may have been spurred into action.

What the Experts Say

Across Ontario and much of Canada, economists are struggling to predict what the next move for the housing and mortgage markets may be. Real estate experts and analysts review a considerable amount of data to project what may happen in the markets next, and the data that they are analyzing is giving mixed results. While some experts have stated that housing prices in the local area are too high and this may eventually lead to a correction, many experts are overwhelmingly positive about the economic outlook in the area. They project that the government will take steps to keep interest rates relatively low across Canada for the next few years. Rates may still rise slowly, but they are not expected to reach the levels they were at prior to the crash for some time. This gives real estate prices in the Oshawa area and other areas throughout Canada more time to stabilize with other economic conditions. The government is actively monitoring the mortgage and real estate markets, and officials have stated that they will take action if necessary to prevent a crash related to a housing bubble.

While there are both positive and negative indicators in the Oshawa real estate market, the fact is that this vibrant and bustling community has a lot going in its favour. If Ontario as a whole or even if much of Canada does experience a crash in the mortgage or real estate sectors, it may be reasonable to expect that Oshawa may be fairly well insulated from the effects. This is because the area has a popular and historic downtown area that draws locals and visitors alike. Its unique charm coupled with its beautiful residential communities and easy commuting methods to neighbouring Toronto make it a wonderful destination to call home. Furthermore, while there are ample employment opportunities that Oshawa residents can enjoy in the bustling metropolitan area of nearby Toronto, the General Motors headquarters located in Oshawa also provides additional stability to the local economy. In addition, the Canadian government will work to prevent major swings in the real estate and mortgage industries. Therefore, those who have been thinking about buying or selling real estate now or in the near future can feel fairly confident that the local market will likely experience only moderate changes at best within the next year as the economy continues to stabilize and consumers continue to gain confidence in the real estate market and other sectors of the economy.


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