Moving up the property ladder is an exciting time in your life – having clarity on how the process works is key to your success.
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- Understand the terms of your mortgage and be prepared – get a pre-approval.
Just because you already have a mortgage now, doesn’t mean you automatically qualify for new one. Policies change all the time along with your credit score, income type/ structure and current debt load, which all contribute to what your current options are.
- Have a deposit ready
These will be the funds you will use to put a firm contract in place. These cannot come from your sale proceeds initially unless the completion date has already passed and you have received the sale proceeds. You will need to have access to this cash up front and you may not qualify to borrow it from a lender, so being pre-approved will help you plan for that.
- Get your dates in order.
Not many people can qualify to won 2 properties at once. This means you cannot buy another home or qualify for a bridge loan until someone has removed subjects on your sale. Bridge financing is required when the sale of your place completes after the completion date of your new purchase, so the sale proceeds (down payment) aren’t available until after you’ve purchased a new home. Bridge loans come at a price – one that needs to be carefully considered. They usually include an admin fee, a short term higher rate charged on the amount being bridged and additional legal fees.
Client First Mortgage Solutions can do a mortgage analysis on your existing mortgage and provide you with transparent, unbiased advice with the power of choice so you can make a decision with clarity moving forward with your plans. The service is free from the initial consultation to ongoing management and optimization of your mortgage.
Original article: https://dominionlending.ca/news/
