Posted by: MonsterMortgage.ca
It is important that people understand when sitting with their mortgage professional what questions they should ask about their mortgage. Sure, you will know your rate and hopefully your mortgage professional will point out all the terms and conditions of your mortgage contract.
But what else should you know?
Were you aware that many lenders don’t disclose the various costs in their mortgage contracts? And that it is up to your mortgage professional to make you aware of the fees incurred both during the mortgage and when mortgage comes due. Costs and fees associated with breaking a mortgage are not always outlined in the mortgage commitment but they will be outlined in the ‘Standard Term Charges’ document. When you start adding up all of those potential costs that “GREAT LOW RATE” all of a sudden is not as low as you thought!!
Most lawyers will not sit down with you to review the ‘Standard Term Charges’, as they typically assume that your mortgage professional has done that. Unfortunately, many deliberately or not, “forget” to inform you of these additional costs and neglect to review the standard term charges with you.
PROTECT YOURSELF AND BE LOYAL TO YOURSELF FIRST!
The following are simple questions to ask your mortgage professional:
How does the lender calculate my penalty if I want to break my mortgage or if I pay it off early?
Are there any other fees beside my penalty and what are these fees for?
What is the cost to discharge my mortgage at maturity?
What are my fees for late payment or NSFs?
Is there a charge for skipping a payment?
These answers will be different with each lender and the response may encourage you to move away from that tempting 2.99% rate to the 3.05% rate with another lender. Why? Because with all those fees your mortgage rate can turn out to be a lot more than you thought once your mortgage term is up!