When you are looking to buy a home, your first step is finding a Hamilton mortgage broker. It can feel a bit overwhelming if you are doing this for the first time. There is a lot of information to take in and it’s important that you ask the right questions before you actually commit to a mortgage. This is a financial obligation that you will have for many years and it’s important that you get the right mortgage package for your needs. Here are the top 5 questions that you should ask your mortgage broker when you see them.
Which Mortgage Is The Best For You?
The most important question to ask your broker is which mortgage type will be the most beneficial to you. A reputable broker will work with you to find the right options for you before they offer up mortgage product. This means they need to take the time to get to know as much about you and your financial situation as possible. Be sure to ask them the advantages and disadvantages of an adjustable-rate, fixed-rate, and interest-only mortgage loans.
What Are the Annual Percentage and Interest Rates?
The APR (annual percentage rate) of a mortgage is determined by calculating the interest rate and related broker/lender fees, which is then divided by the term of your mortgage . Make sure to ask your broker about an accurate frequency of adjustment if you are choosing an adjustable-rate mortgage. You should also ask about the highest cap or rate, the maximum annual adjustment, the margin, and the index.
How Much Do You Need For a Down Payment?
It’s normally believed that you need a 20% down payment to buy a home. However, 20% isn’t mandatory and you can buy a home with as little as 5% down. If you have the ability to make a larger down payment usually makes sense depending on where the down payment is coming from such as higher rate investments sometime it makes sense to keep the investments working for you and having a bit higher, low interest mortgage. Every situation is different. Make sure to ask about all of your options when it comes to down payments, including closing costs such as your lawyer costs and possible taxes which need to be considered in your overall budget.
What Are The Costs?
There are several costs that come with getting a mortgage and your broker should go over all of these with you. Make sure to ask if there are any lender fees, , appraisal fees, broker fees, title insurance cost, taxes, inspection fees, and so on. Your broker should list all of these fees, but be sure to go over all fees before you apply for your mortgage. Your
Are There Any Prepayment Penalties?
In some situations, you may be able to pay off your mortgage early, either through selling the property or refinancing your mortgage. Some lenders will charge a penalty for doing this though, so it’s important to ask if there are any prepayment penalties for doing this. Especially if there is a possibility of having to sell your home in the forseeable future.
These are just 5 of the top questions to ask your Hamilton mortgage broker. You may have other questions to ask for circumstances that are special. It’s always a good idea to take some time and write down the questions you want to ask, as well as look online for questions you may not have thought of.
If you have questions about applying for a mortgage, give our Hamilton mortgage broker team a call today!