5.3.1 Where to get a mortgage

When they want to get a mortgage, many people talk to their bank, credit union, caisse populaire or trust company, or an agency like a mortgage broker. Your financial institution may offer you an attractive interest rate and mortgage terms, but be sure to check with a variety of mortgage lenders. Lenders will compete for your business, and when you know what others are offering, you can negotiate for a mortgage that fits your needs.

When you are thinking about a mortgage, check these sources:

• Banks, trust companies, caisses populaires and credit unions, as well as certain life insurance companies, offer a variety of mortgages at competitive rates.
• Finance companies may offer terms and rates different from traditional financial institutions, but the rates may not be as competitive.
• Mortgage brokers offer mortgages from a variety of lenders and may be able to get very competitive rates; however, they may deal with only a few lenders.
• The seller of the home may be willing to give you a mortgage directly, accepting a series of payments instead of the whole purchase price. This type of mortgage is less common than a mortgage offered by a financial institution. Be sure you get independent legal advice and understand the conditions of the loan.
• In some cases, family and friends may be able to give you a loan secured by a mortgage.

When you compare loans, remember to compare all the terms of the mortgage agreement, not just the interest rate. A mortgage is a significant financial and legal commitment. Before you make the agreement, review it with the lender and get independent legal advice. Be sure that you understand the terms of the agreement and that it fits your financial circumstances—both your ability to make the payments as well as your plans.