FOR FIRST TIME HOME BUYERS
First Home Mortgage
Qualifying for first time home buyers mortgage:
Steps towards home ownership.
Decide if you want to buy vs. rent a home
While owning your own home can offer improved quality of life, security, and a good investment, it may not be right for everyone.
Understand the costs
There’s more to home ownership than your mortgage. To understand what you can afford, consider all the costs you may need to factor into your budget.
Learn about your mortgage options
Understanding which rate, term and amortization period to choose can seem overwhelming. We’ll walk you through the different options and help you choose a mortgage that’s right for you.
Get ready to apply
You’re almost there! We’ll guide you through the mortgage application process and let you know everything you’ll need for your first appointment with a mortgage specialist.
Settle in to your new home
Congratulations on your new home! You're ready to move into your new home.
MORTGAGE TYPES
Choose the mortgage solution that’s best for you
Fixed rate
Offers a guaranteed rate of interest and set payment amounts for a specified period of time.
Features
- Take comfort in knowing exactly how much equity you’ll build by the end of your term
- Available in 1- to 5-year terms for up to 30 years’ amortization
- Guaranteed rate of interest and set payment amounts throughout the term length
Variable rate open
Offers the most flexible repayment options. The amount paid toward principal and interest fluctuates as rates change.
Features
- Make lump sum payments greater than the 20% prepayment allowance at any time without penalty
- Interest floats as per our currently posted rates
Variable rate closed
Offers a set payment amount each month. The amount paid toward principal and interest fluctuates as rates change.
Features
- Could be your best bet in a declining interest rate market because you’ll build more equity as rates decrease
- Available as a 5-year term for up to 30 years’ amortization
- Prepay up to 20% of the original principal amount yearly with no penalty
Variable rate capped
Offers the flexibility of a variable mortgage, but capped at 1% above the current posted rate for a 5-year term.
Features
- An option to consider in rising interest markets that offers a protective ceiling, while still giving some of the benefits of a variable mortgage
- Available as a 5-year term for up to 30 years’ amortization
- Prepay up to 20% of the original principal amount yearly with no penalty
MORTGAGE APPROVAL
Should you get a pre-approved mortgage?
FAQs
Questions
you may have!
How can I qualify for a mortgage?
The amount of money you’ll be able to borrow for a mortgage will depend on a number of factors, including your annual income, outstanding debts, money saved for a down payment and closing costs, your credit score, type of income and location of the home you want to buy.
We will be able to work out how much you can borrow. You would need to provide them with several documents, including:
- Pay stubs.
- T4s/notices of assessment.
- Government ID and your SIN number to pull a credit report.
- Details of your savings accounts (and RRSPs if you’re using them for the down payment).
- Details of any assets.
With us, the mortgage qualification process is quick, transparent and stress-free. We will quickly let you know if you qualify for a mortgage and for how much.
How much should I save for a down payment?
If you have less than 20% of the home’s value saved, you’ll have to take out mortgage insurance (usually through the Canadian Mortgage Housing Corporation). This can be thousands of dollars, depending on the cost of your new home, but the insurance premium can be added to your mortgage — you don’t have to pay for it out of your own pocket.
You must have a minimum of 5% of the home’s value saved as a down payment (as well as enough to cover closing costs). Obviously, the bigger the down payment, the lower the loan, which means either lower mortgage payments or a shorter amortization (the amount of time it will take to pay off the mortgage in full).
Does Bansal Mortgages offer pre-approved mortgages?
Yes, we offer pre-approvals for buying a new home. The rate is guaranteed for 90 days, so you have time to find your new home without worrying about mortgage rate increases.
How can I pay off my mortgage faster?
There are several ways to speed up your mortgage repayment, including:
- Making a lump sum payment each year of up to 15% of your original principal amount and reducing the overall interest you pay on your mortgage.
- Once per year, increasing your regular payment amount by up to 15%. Even a small increase can have a big impact.
- Doubling up your payment by making an additional mortgage payment on a few (or each) of your regular payment dates.
We will integrate your mortgage into your financial plan, which will allow us to discover the best strategies to help you pay off your mortgage faster.
What credit score do I need to get approved to get a mortgage?
A credit score of at least 650 to 680 is needed to secure a mortgage with a conventional lender. If your score is lower than that, you may need to seek out private lenders who work with bad credit borrowers.
What’s the difference between a mortgage pre-qualification and a mortgage pre-approval?
Unlike a pre-approval, a pre-qualified mortgage is only an estimate. It uses your basic financial information to provide you with an estimate on how much mortgage you can qualify for and at what rate. A pre-approved mortgage, on the other hand, is a more accurate version of a pre-qualification. It’s based on extensive documentation and the lender will provide you with a written commitment. Moreover, you can lock in the interest rate for up to 120 days with a mortgage pre-approval, whereas a pre-qualification is simply an estimate.
What is a mortgage stress test?
The mortgage stress test is a model used to verify whether a borrower can afford the mortgage if rates went up or if they experienced some sort of financial turmoil. To pass the mortgage stress test, borrowers must be able to qualify for their mortgage at a rate of 5.25% or at their contracted mortgage rate plus 2%.