Common Untruths About Mortgages
posted in Mortgage News
If you’re applying for a mortgage for the first time, you’ve probably heard at least some of the myths listed below. Now, while seeking help from a mortgage broker can definitely simplify the process and make it more manageable, it’s also helpful to try and get a better understanding of mortgage procedures yourself, and by debunking 5 common untruths about them, you should feel a little more mortgage savvy:
Untruth number 1
The self-employed have got no chance of ever being approved for a mortgage
If you’re self-employed and looking for a mortgage, meeting up with a mortgage broker could prove beneficial, since they are far more likely to have access to the types of lenders who will have solutions for people just like you, unlike the bigger lending institutions. Such lenders take a wide range of income sources and documents into consideration to determine which of their products is right for your needs, and could debunk this common myth in an instant.
Untruth number 2
If your credit score is less than perfect, lenders will instantly disqualified you
Many things can happen in life to harm your credit score, but this doesn’t have to mean that you will automatically be rejected by lenders. While there can be no doubt that having a good credit score will give you an advantage when it comes to buying a home, a good alternative lender (which a mortgage broker can help you find) will look at your bigger financial picture and try to understand the circumstances surrounding it.
Untruth number 3
If you’re new to Canada, you won’t qualify for a mortgage
Fortunately, even if you are a newcomer to the country, there are alternative lenders out there with solutions for immigrants, and your mortgage broker can put you in touch with them. Running programs to evaluate a borrower’s entire financial story, they will look at all factors affecting your ability to pay back a loan, and offer you some options that are workable.
Untruth number 4
25 years is the maximum length of time for a mortgage to be paid off
For insured mortgages with down payments below 20%, the payback period is 25 years, but for uninsured mortgages with down payments of 20% and more, it can be longer. In fact, some mortgages have amortization periods of 30 years, and by working with a trusted mortgage broker, you can find them should you need to.
Untruth number 5
Banks are the best places for mortgages
While the best place for you to get a mortgage might be your bank – especially if you’re a first time buyer - this isn’t always the case, and it will depend entirely on your circumstances as to which lender offers you the best deal. Finding the right lender is made easier with a mortgage brokers help.
Connecting you with the right lender is what mortgage brokers are all about, and with their access to alternative lending solutions, and ability to help you demystify the entire mortgage process, you could be living in your dream home far sooner than you ever imagined!