4 Questions To Ask Before You Buy A Home in Canada

So, you’re thinking about buying a home in Canada. Whether it’s your first home or you’re upgrading to a larger space, there are many things to consider. 

The right property will last for years and prove a wise investment, but buying a home that doesn’t suit your long-term needs could mean expensive repairs and financial losses. 

Despite increasing interest rates and the aftermath of COVID-19, Global News reports that the Canadian housing market is turning a corner, making 2024 a good time to fulfil your property goals. 

In this guide, we’ll explore four important questions to ask before buying a home so you can go into the process with confidence. 

Let’s dive straight in. 

Question 1: Which mortgage rates are available—and which will I likely get?

Unless you’re lucky enough to buy a property outright, you’ll probably need a mortgage. The good news is that there are plenty of mortgage types available, but eligibility depends on multiple factors. 

The most popular mortgages in Canada are high-ratio, fixed-rate, and variable mortgages. However, some lenders offer a wider range of deals based on your circumstances. We work with a variety of lenders which traditional banks may not have access to, and at Prime Mortgage Works we’re able to secure the best rate for your mortgage. Learn more about the benefits of using a mortgage broker vs. a bank. 

High Ratio Mortgages 

High-ratio mortgages are ideal for people who don’t have a large down payment. Most mortgage providers in Canada ask for at least 20% of the property’s market value, but high-ratio mortgages—also known as insured mortgages—let you contribute a lower down payment. 

Pros: 

• Individuals living in high-cost areas can buy a home without saving large amounts for a down payment. 
• Buying your first property is more accessible with high-ratio mortgages. 
• Property owners can still build equity in their property over time. 

Cons: 

• While you can save money on your down payment, you’ll still need to contribute higher monthly repayments. 
• Providers insist on mortgage insurance, which means paying premiums. 
• Some lenders aren’t willing to offer high-ratio mortgages, so you might find them difficult to access. 

Fixed-Rate Mortgages 

Many buyers apply for a fixed-rate mortgage because the lender agrees to a set mortgage rate that remains the same throughout the loan’s duration. For example, if your initial agreement lasts for four years, you’ll make the same monthly payment. 

Pros: 

• You don’t need to worry about surprise interest rate increases. 
• Fixed-rate mortgages are easy to budget as you know what you’ll pay monthly. 
• Many people save money and can switch to different mortgages when the initial term ends. 

Cons: 

• Some fixed mortgages have higher interest rates because you’re paying for stability. 
• If the Bank of Canada’s base interest rates decrease, you could miss out on savings. 
• People with fixed-rate mortgages often find they come with stricter terms, making it challenging to repay them early. 

Variable rate mortgages 

These mortgages are dependent on the Bank of Canada’s interest rates. As they increase and decrease, your monthly payments will do the same. While variable-rate mortgages are easy to secure, they’re also notoriously volatile, and some prefer to avoid them. 

Pros: 

• Decreasing interest rates could lower your monthly payments. 
• Variable mortgages are easier to secure than fixed-rate deals. 
• Most also come with shorter terms. 

Cons: 

• If the base interest rates increase, your mortgage payments will do the same. 
• The instability of fixed-rate mortgages can restrict your purchasing power. 
• Some people find variable rate deals cause a lot of stress and uncertainty. 

Which mortgage am I likely to get?

While there are many mortgages available, the type you’re likely to be accepted for depends on numerous factors, including: 

• Credit History: Lenders want to make sure you’re a safe prospect, so they’ll perform a credit check to assess whether you have a history of responsible borrowing. 
• Income: Applicants with stable incomes are more likely to receive a range of mortgage offers. 
• Buying Status: Some providers favour current homeowners because they’ve already proven they’re reliable and can handle the monthly repayments. 
• Your Preferences: Remember that your preferences also factor into the decision. Some people prefer fixed rates, while others might seek a less popular mortgage deal based on their current and future needs. 

Want to quickly assess how much of a mortgage you’re likely to be approved for?

Use our online mortgage calculator for a quick financial snapshot.

Question 2: What can I afford to spend on a new home, and how will the long-term costs impact me?

Buying a property is a huge decision that will impact your finances in the long run. However, many buyers focus on the outright costs and forget ongoing expenses. Determining how much you can afford will help you save money and prevent going into debt. 

What’s your property budget?

Your property budget depends on the size of your down payment and whether you have a stable income. Most lenders ask for a down payment of 20% of the property’s value, but contributing a larger amount means you could buy a more expensive home. 

If you already have equity in a current property, this could contribute to your down payment, opening up more options. 

Mortgage affordability 

You might be able to secure a high mortgage, but is it a good idea? Lenders will review numerous factors before deciding whether to approve your mortgage application, including your monthly income, financial commitments, and stability. 

Using a mortgage calculator can give you an idea of the amount you might be able to borrow and how much your monthly repayments will be. 

Additional costs

Focusing solely on the cost of your property and mortgage payments can render you unprepared for any additional expenses. These fees include: 

• Home Inspections: Up to $1000 
• Deposits: Usually 5% of the property’s price 
• Appraisals: Up to $500
• Legal Fees: Up to $2000 
• Surveys: $1000 to $2000 
• Land Transfer Tax 
• Mortgage Insurance 
• New Home Warranty 

As you can see, the accumulated costs of the above can make a big dent in your budget, and failing to factor them in might lead to debt. 

Ongoing expenses 

Most mortgage providers ask applicants to secure home insurance, which protects them from damage. You’ll need to budget for your monthly premiums and make regular mortgage repayments. 

Failing to meet your obligations could result in the mortgage company repossessing your property. 

Question 3: Is the property a wise investment?

So, you saw a property, fell in love with it and made an offer—now it’s yours. Stepping into the front door should be a thrilling experience – but what if you’re met with mold, structural damage and faulty electrics? 

Failing to perform due diligence before buying a new home could result in significant expenses and turn your new haven into an ongoing project. Sure, renovations can be fun—but only if you approach them with open eyes. 

Here’s how to avoid any unexpected surprises. 

Book a property inspection 

Professional property inspectors will visit the property and assess it for minor and major issues. Whether it’s mold, roof leaks, or compromised structural integrity, you’ll receive a full report to help you decide whether the property is worth your investment. 

It’s also beneficial to look at the property’s history and assess whether it experienced severe damage in the past. The current owners should be able to provide reports of previous inspections to help you make an informed decision. 

Don’t jump straight in 

When viewing a property, make sure you check it thoroughly. Noticing any odours or cracks might be a warning sign. You should also ask if you can review the electrics and assess for temperature alterations in each room. 

Even minor problems could become significant expenses, so it’s good to know how much you’re willing to spend. 

Assess the extent of renovations 

If you will need to perform any repairs or renovations, it’s a good idea to call a professional for an evaluation. They can tell you how much various work will cost, giving you clarity on whether you can afford to purchase the property.

We recently dove into all of the considerations when buying a home in Victoria. Read our Ultimate Buyers First-Time Homebuyers Guide if you’re looking for a wealth of advice and knowledge.

Question 4: Are you ready for the property-buying process?

Unless you’re a first-time buyer and purchase a vacant property, the time between your offer being accepted and moving into the home can be weeks or months. On average, it takes 91 days – or 13 weeks – but this depends on the seller’s circumstances and your own. 

Your mortgage broker will give you an idea of how long it will take, but buying a home can be stressful. Make sure you do the following things to make it a smooth process: 

• Deal with the mortgage stuff first: Contact a specialist mortgage broker and get pre-approved. Doing this means you know how much you can afford and protect yourself from disappointment. 
• Stay organized: Keep your paperwork in order and plan ahead of time to ensure a smooth process. 
• Be realistic: Understand that the process can take time, and the seller also has to handle their move. Be prepared to wait and stay in touch with your realtor for updates. 
• Reduce stress: Take steps to reduce stress, including enjoying your hobbies, packing things in advance, and avoiding constantly worrying about the move. 

The bottom line 

Buying a property should be an exciting process, and asking yourself the questions we listed ensures you go into it with your eyes open. Once you find your dream home and complete the moving process, you can settle in and turn it into a haven. 

Prime Mortgage Works is fully committed to finding you the best deals. No matter what your personal circumstances are, we’ll work with you to secure a mortgage that aligns with your needs. 

Please feel free to get started with your application today. 

Owning a home gives you more freedom and flexibility—but it also comes with additional responsibilities and big decisions. One such decision is whether to refinance your mortgage.

Refinancing could save money and give you more flexibility if you own at least 20% equity in your property. However, jumping into a decision might mean you don’t fully understand the financial implications of your new deal. 

In this guide, we’ll reveal everything you need to know about refinancing your mortgage, including when it makes sense and how to find the best deal for your needs. 

Let’s jump straight in. 

How Does Mortgage Refinancing in Canada Work?

Refinancing a mortgage means switching from your current deal to a new one. You’ll use the new mortgage to repay your old loan and continue making property repayments. While some people refinance with their existing mortgage company, others might find a new provider. Working with an independent Victoria mortgage broker is one of the best ways to refinance your mortgage and ensure you’re getting the best rate possible. 

Mortgage refinancing is a popular way to access better deals, with many people searching for alternatives due to the Bank of Canada’s increasing interest rates (The Globe and Mail). 

The 2023 CMHC Consumer Mortgage Survey revealed that 24% of respondents refinanced their mortgage to consolidate debts, while 19% focused on home improvements. 

So, how does mortgage refinancing work? 

Assessing Your Eligibility

To refinance your mortgage, you must have at least 20% equity in your property. For example, if your home is worth $700,000, your equity should be at least $210,000. The provider will also check your home’s value and decide whether you can handle the repayments. 

We’ll cover the factors that might impact your application later, but understanding the basic criteria will help you decide whether it’s the right time to refinance. 

Evaluating Available Options 

Refinancing gives you more options, including the type of mortgage you choose and applicable terms. Should you go with a variable rate, or fixed rate? Fixed-rate mortgages offer more stability, while variable mortgages could offer lower rates when the Bank of Canada’s rates decrease. 

Some providers also offer flexible repayment terms, which typically range between 2 and 10 years, depending on your financial status. 

Wondering where mortgage rates in Canada are heading for the rest of 2024? We’ve provided an update on the 2024 mortgage rate forecast in Canada.

The Application Process

Once you decide on a lender, they’ll assess your eligibility and conduct a property valuation. Applications with a good credit score and a history of responsible borrowing might find the process less stressful as lenders view them as a safer choice. 

If everything goes to plan, you’ll receive a pre-approval agreement. When the paperwork is complete, the provider will release funds, and you’ll begin repaying your new mortgage. 

The Pros of Refinancing Your Mortgage

Refinancing is a big decision, but many find it offers them more flexibility and stabilizes their finances. There are numerous benefits associated with switching to a new deal, including: 

1. Saving Money: If you find a mortgage provider offering lower rates, you can save a lot on your monthly repayments. First-time buyers can benefit from lower rates, as they’ve proven responsible during the initial mortgage agreement. 
2. Income Boost: Securing lower repayments can free up cash and boost your monthly income. The extra cash can enhance your quality of life, from paying bills to having more money for day trips. 
3. Debt Consolidation: If you take out a larger mortgage, you can use some of that money for debt consolidation. Clearing all outstanding credit and loan repayments will offer more financial freedom and increase your credit score. 
4. Home Improvements: Lastly, refinancing your current mortgage can fund major renovations, including conversions and adding extra space to your property. These can increase your property’s value, providing a positive return on investment. 

Potential Drawbacks

As with anything, refinancing a mortgage also comes with some drawbacks. While they’re not necessarily deal breakers, understanding the negative side of switching mortgages can help you make the best decision for your needs. 

The potential drawbacks include: 

1. Longer Repayments: A new mortgage could lock you into longer repayments. However, the mortgage duration might not be an issue if you have a stable income. 
2. Associated Fees: If you switch to a new company, your existing mortgage provider might charge mortgage discharge fees. You should also consider legal and appraisal fees. 
3. Higher Interest: Jumping into a decision might mean you miss out on savings. For example, your current deal could offer lower interest rates when you renew, but checking the terms of your mortgage can avoid this. 

Current Interest Rates in Canada

Mortgage interest rates depend on each provider and whether you choose a fixed rate or variable agreement. As of 2024, the average rates are as follows: 

• Fixed Mortgages: Five-year fixed rates generally range between 5.25% and 5.60%, but they’re often lower if you have a larger down payment. It also depends on the company you choose and whether they feel you’re a responsible borrower. 
• Variable Rates: These rates depend on the Bank of Canada’s base rate, which changes frequently. At present, variable interest falls between 5.95% and 6.95%. However, these rates aren’t guaranteed. 

The rates often change with the economy, leaving many wondering whether they could save or lose money on a variable mortgage. Our 2024 Canadian mortgage rate predictions guide can give you an idea of what might happen in the coming months. 

What Factors Impact Your Mortgage Refinancing Eligibility?

Aside from the equity in your property, there are other factors that might impact your eligibility to refinance a mortgage in Canada. Lenders take a risk when offering a mortgage, so they perform due diligence to ensure you’re a stable prospect. 

Here are the main factors to consider before applying for a new mortgage. 

Credit Score

Your credit score gives lenders a clear view of how you manage loans and credit cards. Canadian credit scores are measured on a points scale, with 300 being the lowest and 900 representing an excellent history (Government of Canada). 

Anything above 660 is considered good, meaning lenders are more likely to offer you a better deal. Individuals with a low credit score might find they’re offered shorter repayment terms and higher interest rates. 

If you can take steps to improve your score before refinancing, it will help you access better deals. 

Home Value

Lenders will also perform a home appraisal to assess the property’s current market value. Naturally, they prefer properties with a higher value because it might mean more equity – but this isn’t always the case. 

As your lender will repossess the home should you default on the loan, they’ll want to ensure it’s in good condition and in an area that doesn’t have excessive crime rates. Some lenders are more lenient than others. 

Income to Debt Ratio

Lenders also perform a comparison based on your current income and how many outgoings you have. For example, if someone brings in $6,000 monthly but has $4,000 worth of loan, mortgage and credit card repayments, they might struggle to find a lender. 

Having a high income with low debt obligations gives you access to better rates and repayment terms. 

Savings and Investments/Cash On Hand

While having savings and investments isn’t a defining factor of the application process, it can make a difference. If you have savings, it proves you’re responsible with money, leading lenders to look more favourably on your application. 

A savings account also means you can fund emergency home repairs and expenses, giving lenders peace of mind about your property’s ongoing value. 

Looking For The Best Mortgage Interest Rates in Victoria? Book Your Appointment

Refinancing your mortgage can improve your financial future and provide more stability. Whether you want to approach your current lender or find a new deal, lower rates and better repayment terms will make a significant difference in your life. 

Prime Mortgage Works is Victoria, BC’s top mortgage broker, providing clients with a streamlined application from the initial consultation to closing your deal. We’d love to help you access better interest rates through our network of mortgage providers. 

No matter your financial circumstances, our expert brokers can help, so please feel free to contact us today. 

FAQs

What are the alternatives to refinancing my mortgage?

Your lender might offer a blend and extend the agreement on your existing mortgage, enabling you to access different terms. Some people opt for a HELOC (Home Equity Line of Credit), typically up to 65% of the property’s value. 

These products offer a pre-agreed loan amount, and you can withdraw what you need throughout the duration. However, most HELOC interest rates cost more than refinancing the mortgage. 

How many times can I refinance? 

There’s no limit to mortgage refinancing, but the costs associated with moving to new deals repeatedly will add up. Remember, you’ll have to pay the appraisal, legal fees, and applicable charges to your current provider. 

Can I get a new mortgage with a bad credit score?

A low credit score doesn’t necessarily rule you out of refinancing but can impact your options. Some lenders will turn away anyone who doesn’t have a good score, while specialist mortgage companies might specifically cater to clients with poor credit histories. 

However, lenders typically introduce higher interest rates due to the additional risk they’re taking. 

On March 6th the Bank of Canada announced that they would hold their policy interest rate at 5%, with the bank rate at 5.25%, and deposit rate of 5%. With this announcement, the Bank of Canada is continuing on with their policy of quantitative tightening. The Canadian economy grew in the fourth quarter of 2023, however the growth remained at a slow pace.

In this blog post we’ll delve into the Canadian interest rate announcement, and what this means for Canadian mortgage rates in 2024.

Bank of Canada Announces Interest Rate Remains Unchanged

This morning, the Bank of Canada made a significant announcement by opting to maintain its benchmark interest rate at 5%. This decision, arrived at after careful consideration, reflects the central bank’s commitment to balancing economic growth with inflationary pressures. By keeping the interest rate unchanged, the Bank aims to provide stability to the financial system while supporting continued economic recovery post-pandemic. This decision is likely to impact various sectors of the economy, from lending rates to consumer spending and investment decisions. This affects the landscape for mortgage rates in Canada for 2024, and beyond.

Understanding The Policy Interest Rate

The policy interest rate set by the Bank of Canada serves as a crucial tool in influencing economic conditions within the country, and its relation to the global economy. When the Bank adjusts this rate, it directly impacts borrowing costs for consumers, lenders, and borrowers, consequently affecting spending and investment decisions. A higher interest rate tends to discourage borrowing and spending, leading to slower economic growth and potentially curbing inflation. 

Conversely, a lower interest rate stimulates borrowing and spending, promoting economic activity and potentially increasing inflation. Therefore, the Bank’s decision regarding the policy interest rate has profound implications for the Canadian economy, particularly its Gross Domestic Product (GDP). Changes in the interest rate can influence GDP growth by affecting consumption, investment, and net exports, ultimately shaping the overall economic performance of the nation. 

• For Mortgage Borrowers: The Bank of Canada’s decision to hold the policy interest rate at 5% means stability for mortgage borrowers. Those with variable-rate mortgages can expect their interest payments to remain steady, providing a sense of financial predictability in the short term.

• For Investors: With the interest rate unchanged, investors may see reduced costs associated with borrowing for investment purposes. This could potentially encourage investment in various sectors of the economy, stimulating growth and market activity.

• For Consumers: The decision to maintain the interest rate at 5% may lead to steady borrowing costs for consumers, impacting credit card rates, personal loans, and lines of credit. This stability could bolster consumer confidence and encourage spending, contributing to overall economic resilience. 

2024 Mortgage Interest Rates in Canada

There’s no crystal ball when it comes to 2024 mortgage interest rates in Canada, but mortgage brokers, lenders, realtors, and real estate professionals are seasoned in the ebbs and flows of lending policies and trends. We will discuss the impact of the Bank of Canada interest rate hold announcement for first time homebuyers, mortgage renewals, self-employed borrowers, and those new to Canada.

For First-Time Homebuyers

The Bank of Canada’s interest rate announcement carries significant implications for first-time homebuyer mortgages. With the interest rate unchanged, prospective homebuyers can expect mortgage rates to remain stable in the near term. This stability offers a window of opportunity for those entering the housing market, providing them with a predictable borrowing environment. 

However, while steady interest rates may offer relief from immediate financial uncertainty, aspiring homeowners should remain vigilant. While interest rates may remain stable for now, there is always the possibility of future adjustments, making it essential for first-time homebuyers to carefully evaluate their financial situation and long-term goals before making a significant investment in real estate.

To discuss the benefits of a fixed vs. variable mortgage rate, contact a Victoria mortgage broker today.

For Mortgage Renewals and Transfers

For those looking at renewing their mortgage in Victoria, the interest rate hold implies that they can potentially lock in their interest rates at current levels, providing financial predictability. This stability could be particularly advantageous for homeowners looking to secure favorable terms for their mortgage renewal or transfer, particularly with 

For New To Canada Mortgages

For newcomers to Canada seeking a mortgage, the Bank of Canada’s decision to maintain its interest rate at 5% in its recent announcement carries both opportunities and considerations. On the positive side, stable interest rates provide a sense of certainty and affordability for those looking to enter the housing market. This consistency in borrowing costs can be particularly beneficial for newcomers who may still be adjusting to the financial landscape of their new country. 

However, while steady interest rates offer a favorable environment for securing a new to Canada mortgage, borrowers should always be aware of other factors that can influence their ability to secure financing, such as credit history, employment stability, and documentation requirements. Additionally, given the diverse range of mortgage products and lenders available in the Canadian market, newcomers should take the time to research and compare options to find the best fit for their individual needs and circumstances.

If you’re looking for a quick snapshot of your financial health, use our online mortgage calculator. 

For Self-Employed Borrowers

While stable interest rates can offer a degree of certainty in borrowing costs, self-employed mortgage applicants may face unique challenges when applying for a mortgage. Traditional lenders often scrutinize self-employed applicants more rigorously, requiring extensive documentation to verify income and financial stability. Despite stable interest rates, self-employed borrowers may encounter stricter lending criteria or higher down payment requirements compared to salaried individuals. 

Here at Prime Mortgage Works we’re seasoned in working with lending professionals who offer a wide variety of mortgage products for self-employed borrowers. Contact your Victoria mortgage broker if you’re a self-employed borrower seeking guidance from mortgage brokers specializing in self-employed applicants may help navigate the complexities of securing financing in the current lending environment.

Book Your Consultation With A Victoria Mortgage Broker

Did you know there are significant benefits to using a mortgage broker vs. a bank? With the Bank of Canada holding the interest rate at 5%, a Victoria mortgage broker can secure you the best rates available with a plethora of lenders. 

Contact Prime Mortgage Works today to learn about your lending options.

It is a significant event finally buying your first home, or even a new home. Home ownership means putting down roots and having a space that’s truly yours. Buying a home in Victoria can feel like a daunting task at first. However when done properly, buying and owning a home in Victoria limits your financial risk, increases your investment power and saves you a ton of money in the long run. Let’s have a look at the top 7 benefits of home ownership in Victoria.

Renting vs. Home Ownership

Choosing to rent or buy is a major decision that affects your financial health, lifestyle and personal goals. There are several differences that make renting and owning a property distinctly different. Renting doesn’t come with the responsibilities of home ownership and you have more flexibility as you are not tied down to the property, but you also aren’t building any equity and can have significantly less stability. 

When you buy a home, it will be a place you can always rely on, since it will be yours. Being secure in the home you reside in can make all the difference. Those looking to establish roots, start a family, or have creative freedom over their living space should consider buying over renting. When you buy a home you experience a sense of accomplishment, you worked hard to buy your home and can now make it anything you want. Decorate and furnish it anyway you want. Design and maintain it to your standards of beauty. Your home is an extension of your personality, and every upgrade only adds more value to your home!

7 Benefits of Home Ownership in Victoria

Home ownership is more than about just the roof over your head and building equity. There are so many incredible advantages of owning a home in Victoria that can be very rewarding. If you are on the fence about purchasing your first or next home here are the top home ownership benefits you can feel great about.  

1: Home Ownership Builds Equity, Equity Builds Wealth

A mortgage lets you build equity ownership interest in your home. Home equity is one of the most valuable benefits of homeownership. Equity is the difference between the value of your home subtracted by what you owe on the mortgage. Your equity will continuously grow as you pay down your home. The value of your home will appreciate, or increase over time. 

Building equity in your home is a ready made savings plan. When it comes to long-term financial growth, real estate is your ace in the hole. As a general rule, home values appreciate over the long term. Home ownership is one of the few investments that allows you to increase the value of your property from simply living your day to day life. 

2: You Can Control Your Monthly Payments

Owning a home gives you certainty in housing costs because your mortgage payments (depending on the terms of your loan) stay largely consistent. Unlike rent, a fixed rate mortgage payment wont increase over the years so your relative housing costs actually go down the longer you own your home. You can also make bigger payments as you increase your finances and pay off your mortgage in Victoria even faster. You have more control over your financial stability when you own your home, which enables you to manage your resources more wisely and concentrate on other investments. 

3: The Value Of Your Home Will Increase

The value of your home increases over time, making your investment grow. As you pay off your mortgage, you build ownership interest – which is called equity – which offers financial flexibility. Your home is also a legacy financially or otherwise for the next generation. The value can increase with home improvements, inflation, a growing neighbourhood, etc. Buying a home is one of the best long term investments you can make. Another plus of home equity is it provides flexibility to get a loan tied to the value of your home equity which we’ll explore next.

4: You Can Convert Your Home Equity To Cash

From renting out a spare room to taking out a home equity loan, you have a number of options in your arsenal to monetize your biggest asset. You likely already know that property is an asset that you can tap into and raise a significant amount of cash if needed. This is useful in both a tight financial spot and can serve more long-term serving financial goals such as starting a business, buying an additional rental property and many other investments. There are so many ways that you can use the equity in your home. We recommend you talk to our mortgage experts at Prime Mortgage Works to learn more about the many ways you can turn your current or future home into equity.

5: You Will Continue Building Credit

Owning a house in Victoria can regularly raise your credit score. As long as you make all your payments on time,  your credit score is going to gradually increase. Please note that at the start of the home buying process your credit score will drop. But after a few months of on time payments, your score will be back to normal and then will exceed what it was before. Buying a home can strengthen your status across multiple credit scoring categories. Here are a few ways that buying a home can increase your credit. 

1. Payment history: Is the largest category of your credit score, accounting for 35% of your overall credit. Paying loans and lines of credit in time will improve your payment history. 
2. Your credit limit will increase after buying a home: This higher credit utilization ratio can help you to tap into additional funds and borrowing power.  
3. You diversify your credit mix: A diverse credit mix will strengthen your score. A mortgage demonstrates that you can maintain and balance the responsibility of having multiple types of debt.  
4. Extra and early payments can boost your score: Paying your mortgage on time will improve your payment history. Consistent, early and additional payments help your score and show lenders as well as credit bureaus that you repay your financial obligations in a timely manner. 

On top of this, here are a few more ways that home ownership can increase your credit score.  Any home renovations paid on a credit card, HELOC – home equity line of credit, etc when all paid off on time increase your credit score. 

6: You Can Make Any Improvements and Renovations Yourself

One of the biggest pros of home ownership is that you can turn the house you can afford into the house of your dreams little by little. When buying a home, you can truly make it your own by making any renovations and changes you desire. Switch out that light fixture for a brilliant multifaceted chandelier? Want to knock out a wall for a more open concept layout? Build a deck for more time outside in the beautiful Victoria weather? Even small changes such as changing the home’s hardware and paint can make a massive difference in not only how you enjoy your space, but also these upgrades and improvements increase the value in your home. 

7: It Enhances Your Quality of Life

Home ownership has many benefits that enhance your quality of life and positively impact on family wellbeing. Your home is the place you call your own. Home ownership increases stability for you and the community you live in. Once you get settled, you make friends, get to know your neighbours, and develop a sense of community. This helps to maintain a safe thriving environment for your family and community. Home owners tend to have better physical and mental health, they report a greater feeling of control and self determination over their lives.  Where families are concerned; children with greater residential stability have better academic performance and greater psychological wellbeing. Home owners and their families frequently have improved health, educational attainment and personal wealth.  

Looking for a Victoria mortgage? Try our mortgage calculator

We’ve designed a mortgage calculator to help you discover how you can secure a mortgage in Victoria.

Contact Us For Your Victoria Mortgage

Owning a home is more than just a financial decision. Your investment goes far beyond taxes and equity. Owning a home is an investment in your community, its surroundings like schools and parks. It’s an investment in your family’s stability and consistency by having a place to call home. Owning your home allows you to build memories and to build a new life around the people and things that matter most to you.  

Most importantly, home ownership in Victoria is an investment into your present, and your future.

Contact Prime Mortgage Works today to learn about securing your mortgage in Victoria. 

Using A Mortgage Broker vs. A Bank

When it is time to get a mortgage, Canadians typically turn to one of two sources for securing financing: banks and mortgage brokers. Not sure whether to go with a bank or a mortgage broker for your new home purchase? If you’ve never gotten a mortgage before, it can be hard to know which is better suited to your needs. If you’re a first time home buyer knowing the differences can help you to make this important decision. A broker compares products from a variety of different lenders. A bank on the other hand will only offer you its own mortgage products. Let’s look further into the differences between the two and the benefits to you of working with a mortgage broker. 

What Does A Mortgage Broker Do?

A mortgage broker is a licensed professional. They act as an intermediary who matches home borrowers with potential lenders in order to obtain the best possible mortgage terms for you, the borrower. A mortgage broker saves you time, effort, and potentially a lot of money, during both the application process and the life of your loan. 

How this works is: the broker works as an intermediary between you, the borrower, and lenders in the real estate market. Whether you are buying your first home, a new home, refinancing your mortgage, or purchasing an investment property, a mortgage broker is responsible for presenting and qualifying you for loan options from many lenders for your consideration. 

To do this, your mortgage broker sits down with you, their client, to assess your needs and financial situation. They gather all the pertinent information lenders require to obtain your mortgage, such as: proof of income, pay stubs, tax returns, details regarding assets and investments, credit reports, etc. This helps them evaluate what you can afford and then they take this information to the lenders for mortgage approval. Brokers are also responsible for all communication between you and the lender during the application and approval process. A good mortgage broker, such as at Prime Mortgage Works, brings valuable information and connections to the table providing convenience, the best possible rates, and avoiding multiple credit reports seen as how you are only working with one person. 

What Are Some Benefits to Using A Mortgage Broker?

When it comes to securing a mortgage for the home of your dreams, you’re faced with so many options, one crucial decision is whether to work with a mortgage broker or go it alone. A mortgage broker is a regulated professional who acts as a middleman between you and mortgage lenders. The primary goal of a mortgage broker is to help you find the right mortgage taking into account what is right for you and your needs. Let’s delve into some of the benefits and advantages of why you should consider having a mortgage broker on your side. 

• Mortgage brokers have access to multiple lenders.

One of the most significant advantages of working with a mortgage broker is access to a wide variety of banks and lenders. Your mortgage broker is your advocate, looking for the best possible terms. Your mortgage broker has access to multiple lenders, they work with banks, credit unions, and independent lenders. Mortgage brokers help you find the best loan for your needs, they compare products and policies from all the various lenders. They also know what it takes to get you the best loan from all the different lenders. This access to more lenders than you on your own have access to, saves you time, effort, and money. 

• A mortgage broker’s commission comes from the lender, not the borrower.

Have you ever considered how a mortgage broker will need to be paid and how they earn their money? Most mortgage brokers are paid on a commission basis meaning that, for every mortgage they successfully complete on behalf of their customers the advisor then gets paid a commission from the mortgage lenders, not you, the borrower.  This means that you don’t pay anything to use a mortgage broker. Many mortgage brokers are only paid when they successfully arrange your mortgage – if they are not successful they will not get paid. This makes them work harder to fulfill all of your terms and needs. The expertise of a mortgage broker makes your property purchase journey smoother, faster and more cost effective. 

• Mortgage brokers can leverage relationships with lenders to get better rates.

Mortgage professionals have independent relationships with a variety of lenders. A broker gives access to lenders that you may otherwise not be able to contact directly to obtain your mortgage. That’s because some of them work exclusively with mortgage brokers and rely on them to bring them suitable clients. Brokers are able to get rates from lenders that are lower than you can get on your own, due to the volume of business they generate for the lender. Several different types of fees can be involved in taking on a new mortgage or working with a new lender, including origination fees, application fees and appraisal fees.

Your Victoria mortgage broker, Prime Mortgage Works, is able to get lenders to waive some or all of these fees due to their relationship with the lenders, which can save you thousands of dollars. 

• Mortgage brokers have great relationships with local, trustworthy realtors.

A good mortgage broker, like your broker at Prime Mortgage Works, not only do they have excellent relationships with lenders. What’s often overlooked – and is just as important as interest rates  – is the great relationship they have with local, trustworthy realtors. Real estate agents and mortgage brokers share several different skills and professional connections. This relationship is all about working together combining their knowledge to help clients and make your home buying journey easier and smoother. Agents and brokers team up early, planning how to help their clients reach their goals, they work together on offers, making sure everythings ready on time.  They stay in touch, tracking progress and fixing any bumps along the way. If any issues pop up they work as a team to solve them, so that you don’t need to worry. From finishing paperwork to sealing the deal, agents and brokers team up for a great ending. 

Interested in a quick quote on your potential mortgage? Use our easy online mortgage calculator.

Here’s Why A Victoria Mortgage Broker Can Be Better Than A Bank

Mortgage brokers work for you, bankers work for the bank. 

Brokers are not limited in the products they can offer to you. Brokers can seek out the very best lender to suit your specific needs. Getting a mortgage through a mortgage broker is easier in the sense that you have someone helping you compare rates and handle the application and closing process amongst many other things. If you want to maximize your savings and ensure a successful property purchase partner with your mortgage broker at Prime Mortgage Works, we will help you find your dream property on time and within budget. 

Mortgage brokers get a variety of rates and lending products which may not be otherwise available

The big difference between a mortgage broker and a bank is that a mortgage broker can provide you with mortgage products from several different lenders, while a bank can only give you mortgage options from their own company. Mortgage brokers have access to a variety of lenders and rates, which means they can find the best and lowest possible rate for you and any specific terms that you are interested in.  Brokers have connections that are unavailable to you as an individual borrower, and even enjoy volume discounts since they regularly do business with a variety of lenders.

A mortgage broker in Victoria has access to discounted rates from lenders

A mortgage broker will already have a grip on which lenders are currently offering the best rate deals and what their terms are. Over the years your mortgage broker has built great relationships which help to build their business and more importantly help you, the client. These connections combined with experience and expertise, allow your mortgage broker to secure the best rate, product and terms favorable to you.  

We work for you – it’s our job to get you the best rate possible

The mortgage broker at Prime Mortgage Works helps you find the best rate because we have access to multiple lenders , and can help you to find the best interest rates available on the market. This saves you money over the life of your mortgage, as even a small difference in interest rates can add up over time,  For example a difference of just 0.25% on a $300,000 mortgage can result in savings of over $16,000 over a 30 year term making your mortgage broker an invaluable resource for homebuyers looking to secure the best possible mortgage deal. They save you time and effort, offer access to a wide range of lenders, and help you find the best interest rates available on the market. 

By working with your broker at Prime Mortgage Works in Victoria you increase your chances of securing a mortgage that meets your financial needs and goals, securing the home of your dreams with freedom and ease. Additionally if you are a first time home buyer, a broker can help you to navigate the complex world of mortgages and provide you with a personalized and stress free experience in finding a product that fits your needs and budget. 

Book a Consultation With A Victoria Mortgage Broker Today

Navigating the process of buying a home and securing a mortgage is stressful without the right advice.  With so many variables and conflicting advice out there, it is difficult to know where to start, let alone know what is the best option for your situation.  Mortgage brokers help make sense of it all and set you up for success.  At Prime Mortgage Works, we are here for you every step of the way to answer all of your questions and guide you into your new home with personalized, unbiased, and objective advice so you get the best mortgage product possible.  

Contact Prime Mortgage Works today to learn about securing your mortgage in Victoria.