Frequently Asked Questions

Getting pre-approved for a mortgage can save time and possibly money when you are in your house-hunting process. Lenders will determine the home price you can afford based on your financial conditions through a mortgage pre-approval. Therefore, you can better plan and budget for your home purchase while you are doing research.

When you get pre-approved for a mortgage, you’ll find out:

• The maximum amount you can afford to buy a home
• The monthly mortgage payment associated with your maximum affordability
• Your mortgage rate for your first mortgage term

Applying for a mortgage pre-approval is free and doesn’t commit you to one single lender. However, getting pre-approved does guarantee that the mortgage rate you are offered by a lender will not change for up till 120 days. By “locking in” your rate, you’re protected if interest rates rise while you’re shopping for a home. If interest rates go down during this time, your lender will honour the lower rate.

In the past, we required the following to commence a file:

• Signed Application
• Photo ID
• Preliminary form of income validation (paystub if salaried or previous year NOA if self-employed)

Since January 1, 2018, the new government imposed mortgage rules requires us to collect more documents up front:

•      Signed Application
•      Photo ID
•      Salary Letter from Employer
•      Recent paystub (within 30 days of application)
•      Previous years T4
•      Last two years Notice of Assessments from CRA if Self Employed
•      Last two years T1 General filed with CRA if Self Employed
•      Articles of Incorporation or Business License if Self Employed
•      6-12 months Business Bank Statements if Self Employed to validate active business activity
•      2-4 actual invoices to match deposits in bank Statements
•      Property Tax Statement if existing homeowner
•      Current Mortgage Statement if existing homeowner

However, required documents vary from case to case. Please chat with us so we can do the heavy lifting for you.

Mortgage closing costs, also known as settlement costs, are fees charged for services that must be performed to process and close your loan application. Examples of mortgage closing costs include title fees, recording fees, appraisal fees, credit report fees, pest inspection, attorney’s fees, taxes and surveying fees. The closing cost of a loan will vary depending on your geographic location.

Lenders are required by law to provide you with two documents – the Loan Estimate and the Closing Disclosure – which outline your closing costs and help you avoid surprises at the closing table.

The minimum amount you’ll need for your down payment depends on the purchase price of the home you’d like to buy.

• If your home purchase price is $500,000 or less, the minimum down payment required is 5% of your purchase prices.
• If your home purchase price is between $500,000 to $999,999, you are required to have 5% of the first $500,000 of the purchase price plus 10% for the portion of the purchase price above $500,000 for your down payment.
• If your home purchase price is over $1 million, you are required to have 20% of the purchase price of the down payment.

If your down payment is less than 20% of the price of your home, you’ll need to purchase mortgage loan insurance.

Requirements are variable In some cases. For instance, if you are self-employed or have a poor credit history, you may require a larger down payment or to have mortgage loan insurance even with over 20% of the purchase price for your down payment.

When shopping for a home it’s important to determine the maximum mortgage and the home price you can qualify for. To determine your maximum affordability, lenders take several factors into account, including:

• How much cash or liquid assets you have.
• Whether a monetary gift is part of your down payment.
• What your gross family income is.
• If you have any other debts.

Mortgage brokers are specialized in one thing: mortgages. An experienced mortgage professional will be able to access the best mortgage products in the marketplace and their expertise will help you save money.

Your mortgage broker or agent is a licensed professional who will shop your mortgage around to various financial institutions and find the best possible mortgage product, terms and rate available. A mortgage professional doesn’t work for a specific bank, lender or financial institution – their focus is on you.

In most the cases, our services are free, but in some scenarios where applicants face challenges over and above conventional means (such as poor credit and/or a unique situation that requires extra attention), there may be a fee incurred. We’ll always explain this fee to you in advance and before any fees are incurred. No surprises.

We are compensated with a finder’s fee by financial institutions to bring great clients to their portfolio. This finder’s fee is disclosed to you by your mortgage agent to promote transparency. This allows MonsterMortgage.ca® to provide you with unbiased advice and unlimited access to the best mortgage products in the market.