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Things you should Know about Mortgage 

»Posted by on Oct 21, 2018 in Uncategorized | 0 comments

A mortgage is something like a loan that is secured to your home. Meaning if you fail to pay your mortgage you put your home on the line for foreclosure. You don’t want that to happen to you. Just imagine living in that home for a long time only to get kicked out because you weren’t able to pay your mortgage. It becomes important for any loan you make especially when you get a Toronto mortgage that you know everything that there is need to know about it.  

Mortgage

So, here are things you should about mortgages. These are all essential so that you can buy your dream home, without worries.  

How does Mortgages Work?  

Mortgages as mentioned before is a loan that you take out from the bank or a lending company that is against your property, it is a loan that is secured to your home. You will need to of course put in a deposit sometimes 10% or 20% of the loan. However, there are some options you can have when you don’t have the money to pay the 10% or 20% deposit.  

You will of course be expected to pay your mortgages due every month and if you fall too much behind with it. You put yourself and your property in risk of repossession, this is where the bank or lending company would have to sell your property to get back as much as they lost.  

How much can you afford? 

When you apply for a mortgage loan, the bank or the lending company would most likely review your application before allowing you to loan out the money.They would review it against your credit score and the income you are earning per month. Your job would also be considered because there are different kinds of jobs out there. So, in terms of how much you can afford it will be against a specific criteria that you have to fill.  

What are the options of repayment mortgage?  

Repayment mortgages have two options, whether you pay the interest and the capital you owed wherein you own the property when you pay your debt or you can pay interest only however, they will own your property for life. It is pretty important that you consider this though because some banks won’t even allow you to pay interest only. Some companies would offer it however, you have to have a concrete plan in repaying your mortgage.  

Why do fees matter?  

Why are the mortgage fees matter? When you have a longer deal period you will have to pay a bigger interest rate. So, say you work to pay your interest rate within two years you will also be paying smaller compared to the longer deal period. Some lenders can also profit with the fees that they put into your mortgage and it can amount into something big. So, you’ll have to consider that when you are comparing mortgages because that will pile up.  

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