Figuring out the appropriate size of a down payment on a house is a common challenge for home buyers. We’ve got answers to a few frequently asked questions to help you make the right decision. Fortunately, 20% is no longer the benchmark for a down payment on a house. In 2022, the average down payment was 6% for first-time home buyers and 17% for repeat buyers. The minimum down payment will largely depend on the type of loan you choose for your primary or secondary residence or investment property. You likely won’t put any money down if you qualify for a USDA or VA loan.

A reverse mortgage allows homeowners aged 62 or older to transform their home equity into cash payments. As long as the borrower(s) remain living in the home as their primary residence, the loan doesn't require repayment. The funds received from the mortgage can be utilized for various expenses at the discretion of the borrower.

In the realm of home buying, each purchase stands as a distinct endeavor. There exists no universal mortgage solution for all. Fortunately, our loan originators have the expertise and insight required to assess which loan aligns best with your circumstances. It is crucial to evaluate your present financial status and your intended duration of property ownership.

Same-day pre-approval is possible. Upon application submission, we diligently verify all provided information, a process which generally extends over a week. Timely return of any requested information or documentation is paramount to expedite proceedings. The comprehensive process of gathering necessary details for loan approval, rate locking, and factor determination typically spans 3-4 weeks.

The primary distinction between an FHA loan and a Conventional loan lies in their insurance coverage: an FHA loan is government-insured, while a Conventional loan is not.

FHA loans typically offer lower down payment options and have less stringent credit score requirements, albeit necessitating mortgage insurance. While they are generally more accessible, eligibility mandates both the property and lender to be FHA-approved, and their usage is restricted to primary residences.

Conventional loans are applicable to various property types and can be secured through most lenders. As they lack government backing, they demand solid credit and financial standing, often favoring a higher down payment.

Tailored financial solutions enabling applicants with non-traditional income streams—such as freelance income, bonuses, or annuities—to secure mortgage financing. Services include various loan types aimed at accommodating diverse financial scenarios, including income from unconventional sources.

The systematic reduction of a loan balance through periodic payments, ensuring both interest and principal components are covered, leading to the full repayment of the loan over its term.

An official evaluation to ascertain a property’s market value for the purpose of taxation, ensuring equitable property tax distribution.

A refinancing option that allows homeowners to access the equity in their home as cash, offering an alternative to other high-interest borrowing options.

An authoritative document affirming property ownership, detailing the property's legal status, including any claims or encumbrances.

The array of fees and expenses payable at the closure of a real estate transaction, covering various administrative and legal services.

A detailed statement provided to the borrower ahead of the closing meeting, summarizing the terms, costs, and fees of the mortgage agreement.

A financing option that combines the construction of a new home and its mortgage into one loan, simplifying the financing process for building a home.

A mortgage option provided by private lenders without government backing, often necessitating higher credit scores and down payments from borrowers.

A crucial metric used by lenders to gauge a borrower's financial health, reflecting the balance between their debt obligations and income.

The owner's financial interest in a property, calculated as the difference between the property's current market value and the outstanding balance of all liens on the property.

A neutral third-party managed account where funds are held until the completion of a transaction or the fulfillment of contractual obligations.

A specialized loan product designed for individuals buying a home for elderly parents or disabled adult children, promoting family support and housing stability.

A government-backed mortgage designed to lower the barriers to homeownership, offering lower down payments and more lenient credit requirements.

A specific FHA loan offering financial assistance to victims of natural disasters, aiding in the recovery process through housing support.

A unique loan combining property purchase and renovation costs into a single mortgage, ideal for purchasing fixer-uppers.

The legal process initiated by lenders to reclaim a property due to the borrower's failure to meet mortgage payment obligations.

An expert evaluation of a property's market value, conducted by a certified appraiser to ensure a fair purchase price or loan amount.

A revolving credit line secured against the equity of the borrower's home, offering flexibility in borrowing and repayment.

The cost of borrowing money, expressed as a percentage of the loan amount, influencing the total cost of the loan over time.

A mortgage option for financing properties that exceed the standard loan limits set by government-sponsored entities, catering to the purchase of high-value properties.

A legal claim or right against a property, securing the payment of a debt or obligation linked to that property.

A metric assessing the relationship between the loan amount and the property's value, influencing loan approval decisions.

A professional intermediary facilitating the process between borrowers and lenders, ensuring clients receive optimal mortgage terms.

An extensive database of properties available for sale, utilized by real estate professionals to match buyers with properties.

A lender’s initial evaluation of a borrower's creditworthiness, indicating a tentative commitment to lend under specified conditions.

Insurance required for borrowers who make a down payment less than 20%, protecting lenders against default.

A licensed professional specializing in the buying and selling of real estate, serving as a negotiator and advisor for clients.

A loan that combines the cost of home improvements with the purchase or refinance of a home, facilitating property upgrades.

A financial product for homeowners aged 62 or older, allowing them to convert part of their home equity into cash without selling their home.

A policy that protects property buyers and lenders from losses due to title defects, ensuring clear property ownership.

The comprehensive analysis conducted by lenders to assess the creditworthiness of potential borrowers, considering factors such as income, credit history, and the value of the collateral.

A loan program guaranteed by the United States Department of Agriculture, designed to support rural homebuyers with 100% financing options.

A mortgage guarantee program offered by the U.S. Department of Veterans Affairs, providing eligible veterans and their families with access to home financing with favorable terms.

This is a mortgage which offers the same security as a closed mortgage, but which can be converted to a longer, closed mortgage at any time without prepayment costs. Typically associated with fixed rate mortgages.

The mortgage you obtain when you have less than 20% of the total purchase price to put down as your downpayment. This type of mortgage must be insured (through sources such as CMHC or Genworth Financial Canada).

This type of mortgage may be repaid, in part or in full, at any time during the term without any prepayment costs.This type of mortgage may be repaid, in part or in full, at any time during the term without any prepayment costs.

An interest rate that will fluctuate in accordance with the prevailing market prime rate during the mortgage term.

The percentage interest that you pay on top of the loan principal. For example, you may take out a mortgage of $100,000 at a rate of 12%. Your monthly payments will consist of a portion of the original $100,000, plus 12% interest.

The amount of interest due between the date your mortgage starts and the date the first mortgage payment is calculated from. Sometimes there is a gap between the closing date of your home purchase and the first payment date of your mortgage. Let’s say that the closing date on your new house is August 10th – but your mortgage payments are on the 15th of each month (so your first payment is calculated from August 15th and paid on September 15th). That leaves five days (August 10th to 14th) that aren’t accounted for in your first mortgage payment. You have to make an extra payment to make up for these five days; the payment is generally due on your closing date. You can avoid all this by arranging to make your first mortgage payment exactly one payment period (e.g., one month) after your closing date.

A tax that is levied (in some provinces) on any property that changes hands.

Some of the legal costs associated with the sale or purchase of a property. It’s in your best interest to engage the services of a real estate lawyer (or a notary in Quebec).

The amount you will owe if the person selling you the home has prepaid any property taxes or utility bills. The amount to reimburse them will be calculated based on the closing date.

A legal description of your property and its location and dimensions. An up-to-date survey is usually required by your mortgage lender. If not available from the vendor, your lawyer can obtain the property survey for a fee.

Taxes applied to the purchase cost of a property. Some properties are sales tax exempt (GST and/or PST), and some are not. For instance, residential resale properties are usually GST exempt, while new properties require GST. Always ask before signing an offer.