How to Qualify for a mortgage in Canada
Most of the people are not fortunate to be able to buy property without a mortgage. To put it simply, a mortgage is an amount that you get as a loan in order to buy a home.
Lenders give you relatively large sum of money and keep your home as a security for that loan.
A legal contract is signed while you apply for it, which says if you fail to repay the amount at the promised time, the property kept as collateral will be taken over by the lender.
Are You Eligible for Mortgage?
The first thing that you need to do is to go to a bank and get a pre-mortgage approval.
Your lender can suggest you quite a few options and if everything goes well, the lender will tell you on which terms you can get the loan for your home.
How the Lenders will go on with the process?
It is the duty of the banks to review your financial status, before lending you the amount. If you are a Canadian or if you have been living in Canada for quite some time, the banks are ought to check out your Canadian credit history, to ensure you have a sound financial record. And, if in case you do not have any credit history, then maybe create one by taking a small loan and paying it off on time.
You may also need to show your job history or show source of income to the bank to avail a good amount of loan.
Apart from all this, there is a possibility that you can get a mortgage on the basis of your overseas history. You can take the help of Imperial Bank of Commerce or TD Canada Trust.
Howsoever, in this case you may have to pay a relatively bigger amount of money, i.e. around 25 to 30 percent of the funds on your own while buying a house.
Determine the size of your Loan
Once you are sure that you are eligible to get the mortgage, you need to make out the size of the loan you want to get. Generally, 95% of the amount can be taken as a mortgage and rest 5% amount is to be paid as a down payment. The more you will pay off as a down payment, the lesser will be the installments and the interest accrued.
Choose a Mortgage Plan
With a number of options available for you, it is hard to find out the perfect one for buying a home. So, consider everything, think clearly if you can make little compromises and then choose a plan for yourself.
Finally, if you have any credit issues or you are simply encountering problems in getting the loan, ask the banker or some renowned broker to help you with the matter. An expert lender will figure out the problem and show you the right way to get the mortgage. They actually make sure that you get a home without any worries and everything goes well while applying for it. Of course experience is paramount in this.