Considered a “one size fits all” tool, the Mortgage Stress Test affects all homeowners alike, regardless of whether you are a first-time home buyer or homeowner preparing to renew* or refinance their mortgage.
*Homeowners renewing their mortgage financing who fail the stress test are bound to their original mortgage lender, without the option to shop for better mortgage rates, features or terms.
What is the Mortgage Stress Test?
Borrowers must show they can afford interest rates two percentage points above the current rate.
Tracy says: Stay tuned for some budget incentives for first time home buyers.
Professional Mortgage Tips for Buying a Home or Refinancing Your Mortgage
- Review your discretionary spending habits. Know exactly where you spend and why.
- Divert a percentage of your income to save for a down payment or pay down your existing mortgage at renewal time, if you have that option. Set up a monthly automatic transfer of funds. After a few months of adjustment, you won’t miss it.
- Live and die by a budget. Welcome the opportunity to get creative with spending and enjoy life!
- Know and monitor your credit history. This is fundamental to the mortgage pre-approval process. A balanced credit score with appropriate spending limits allows brokers to provide flexibility in their mortgage rate offerings.
- Decrease debt and pay off monthly credit card statements. In January 2019 Livabl_ Market News reported, “Debt has caused 18 percent of Canadians to put off buying a home, according to an Angus Reid Institute survey undertaken in partnership with The Globe and Mail newspaper.” Not only will this make you more attractive to mortgage lenders, you’ll avoid costly high-interest rates.
- Live your dream of home ownership. Before you buy or refinance a home, live within your budget beforehand to truly appreciate how it feels.
Read more about Mortgage Basics: http://tracyirwinmortgages.com/Mortgage-basics.html
What’s a Collateral Mortgage?
Watch this 6-minute video produced by CBC News: Marketplace. Find out what to look for BEFORE you sign. https://m.facebook.com/story.php?story_fbid=10153151838879429&id=28211229428
Tracy says: If you’re applying for a mortgage with a down payment of more than 20% be sure to ask questions, such as, “Is this a collateral mortgage?” “What mortgage amount will be registered against my property title.” Please contact me if you have a mortgage question or need help!
Why Use a Mortgage Broker Like Tracy Irwin?
Mortgage Brokers are independent professionals that represent YOU, the client, not the lending institution, for example, a bank. This affords you the best independent advice for your mortgage needs. There is no charge to work with a Mortgage Broker. Their fees are paid by the lender.
If you have questions about first time home ownership, refinancing or renewing your current mortgage, give Tracy a call. Where there’s a will, there’s a way.
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