Learn the questions you should ask your mortgage professional if you're considering buying a home and want to get pre-approved for a mortgage, or you're thinking of selling and wondering if can get out of your existing mortgage, or porting your mortgage to a new home.

General Mortgage Questions

Before you begin your home search, ask to be pre-approved in writing.  They should be asking you for proof of income, running a credit check, etc.  Otherwise you are not properly approved and when it comes time to ask for the mortgage (when you purchase) you may not qualify.

  1. Are there any fees?
  2. Down Payment Requirements - What is the minimum required in your scenario?
  3. Discuss payments, mortgage rates, potential CMHC insurance based on different down payment amounts (eg.5%, 15%, 20%, etc.)
  4. What mortgage rate will they guarantee and for how long?
  5. How much money do you qualify for?  Does that include your existing mortgage (if applicable).
  6. What types of mortgages are available?  Can you transfer the mortgage to a new property?  What is the payout penalty if you decide to payout your mortgage or move it to another property?  (We don’t recommend a “no frills” mortgage. The rate will be less expensive, but there are no features such as being allowed to put extra money on your principal, change your monthly payments, etc.)
  7. Discuss differences between weekly, monthly, or bi-weekly payments.  (You’ll pay your mortgage off sooner if you select weekly.)
  8. Discuss different term and amortization periods (which affect your monthly payments).
  9. If applicable, discuss requirements with "gifting" (eg. if someone gives you money for your down payment). How long must the money be in your bank account? Is a gifting letter required?
  10. If applicable, discuss using RRSPs for your downpayment (and the process). You will also want to ensure your RRSPs are liquid.

Questions For Existing Mortgages or Porting Your Mortgage

  1. What is the principal owing?
  2. When is your renewal date?
  3. What is your payout penalty?
  4. Is your mortgage open and portable to a new home?
  5. Are there any costs to “transferring” it to your new home?
  6. What are the restrictions?  (e.g. Do you need to port it within 3 months of completion date of your current home and completion of purchase for new home?  Or...?)
  7. To qualify for exemption of the payout penalty, does the mortgage on the new property need to be worth more than what you currently owe?  Or does the mortgage amount need to be the same as your existing (and cannot be increased)?  Can you increase the mortgage amount?
  8. Does the lender allow the application to change? For example, a client may sell a home and repurchase a new home with a spouse. Would the lender allow the new applicants to join the application?
  9. Is term length of the mortgage allowed to change? For example, if the current mortgage has two years remaining, can the client extend the mortgage to a term longer than two years?
  10. What is the best and least expensive way to close your existing mortgage and receive a new mortgage on your new home?  Discuss costs with each scenario?
  11. The mortgage penalty will be based on your remaining principal.  Therefore, can you put lump sums on your principal to reduce the penalty or increase your current payments?  If so, how much and how often?

Please Contact Us for more information or for the names of some great mortgage professionals.

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