5.4.4 Questions to ask about mortgages

From: Financial Consumer Agency of Canada

Here are some questions to ask yourself before you get a mortgage. Write the answers in spaces when you know them.

1. How much can I afford to borrow? (Use your income and expense budget to calculate what you can afford. Don’t plan on spending every penny in your income—leave a cushion in your budget for unexpected expenses. The Financial Consumer Agency of Canada’s interactive Mortgage Qualifier Tool can help you estimate how much a financial institution will lend, but it may be more than you can afford comfortably.)


2. How much will I have for a down payment?


3. How much of an increase in my mortgage payments will I be able to afford if interest rates go up?


4. Have I shopped around to find the best combination of interest rate and features for my needs?

As you shop around for a mortgage, ask each lender the questions below. Write down the answers from several different lenders and compare their responses.

1.What is the interest rate? What is the term?

  

2. What fees do I have to pay?


3. Can I make extra payments when I have money available?


4. How can I save on interest charges? What options do I have?


5. What options do I have if I want to pay my mortgage off early?


6. If I sell my house or property before the scheduled maturity date, will I have to pay an extra charge?

If Yes, how much will the charge be?


7. If I sell my house or property, can I transfer the remaining amount of my mortgage and the terms to a new property without paying an extra charge?

If Yes, what fees or limitations apply?

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