Monthly Archives: June 2022

Divorce can be challenging enough without the financial complication because you have to deal with the emotions. Worst case scenario will be if there are kids involved. You need to help them through the trauma while handling your heartaches.

You might face another post-divorce dilemma if you get through the emotional roller coaster: a mortgage. You might have to sell your current home if it is in both of your names or refinance it as a part of the divorce agreement. But if you are not making enough money to cover the bills, how will you pay for the divorce attorney?

If these daunt you, you should simply take a breather and read this blog carefully. We have tapped into the prowess of seasoned mortgage brokers in Ottawa to help you through this crisis.   

Talk about It

Your mortgage agent will encourage you to talk things over. You have to determine what each party wants. 

You may be tempted to tell your former partner to take off, but it is not that simple. Your ex-spouse might not have enough money for a down payment. With this said, you might have to work side by side with your former spouse in determining the path forward. It is certainly not an easy job, but it is undoubtedly possible with the help of an intermediary.

You also need to determine the value of the property. In this step, you need the help of an appraiser or a realtor. They can tell you how much the property is worth at the divorce.

Options for Handling the Mortgage

Your mortgage agent can offer you a few options. Think of them as life vests in a turbulent ocean of divorce. Here are some:

Sell Your Home

You can sell your house. As mentioned earlier, your home is probably the most valuable asset. It can fetch a reasonable price. The mental stress alone is worth it.  

However, you need to be creative in terms of selling it. You do not have to go the traditional route of a realtor. You can look for buyers online. If you have to sell it for whatever price you can get, you might have to wait for some time because it is no longer a seller’s market. 

Refinance

You might be astounded that you can still avail a refinance, but you still can. It would be best if you simply asked your mortgage agent. To qualify for refinancing, you need to meet the credit requirements of your lender. 

Kindly note that this choice is only available if you can afford the mortgage payment yourself. If you are unsure, you might have to go for a short sale. Remember that refinancing your mortgage has one significant upside: you can keep your house.

Refinancing may be an option after all. You would need to talk to a mortgage agent to see if you are qualified for this. 

Conclusion

You do not have to go through this alone. Your mortgage professional can guide you on this path. They can help you understand your options and decide which one best fits your situation. Do not be afraid to ask.

If you are going through this type of change, you should contact Ottawa Mortgage Services. As a mortgage agent in Ottawa, I can help you through this tricky monetary dilemma. You simply have to consult me, so contact me now for more information!

For the average Canadian, getting a mortgage on a single-family home is a big, big deal. It’s essentially the single largest debt you will ever have to pay off in your life. A typical mortgage will last up to 30 years, 60 years (if you stretch it out), or even 80 years! The good news is, there are ways to pay off your mortgage sooner. Let’s look at some of the ways to do it.

1. Pay More Than the Minimum on your Mortgage

When you get a mortgage on a residential property, you will be required to make monthly payments on it. The amount of these payments is commonly called the “mortgage payment.” If you pay more than the minimum amount of your mortgage payment, then you will be increasing the amount of money you pay against your mortgage on a monthly basis. And as a result, you will be getting rid of the mortgage faster.

The minimum mortgage payment is typically calculated as a percentage of your outstanding mortgage amount. For example, let’s say you have a mortgage of $300,000 and you have 20 years to pay it off. If the minimum payment is 2.5%, then the minimum payment that you will be required to pay per month is $850. But let’s say you decide to make your monthly payments equal to 3%. In this case, your monthly payment will be $1,050. This means that you will end up paying an extra $200 each month. This is money that will be added to the outstanding mortgage, and therefore, your mortgage will be paid off faster.

2. Make your Extra Payments to Pay Off the Principal of the Loan

When you remit payment to your lender, the bank will be able to tell if you are overpaying on your mortgage based on the interest rate. For example, if you make a $1,000 payment, but the bank only charges you $550 in interest, it is going to look at your payment history and see you’ve overpaid by $450. It will then redirect those payments to your principal. If you are already paying more than the minimum amount required to pay the interest, then you can make extra payments that will only be applied to the principal balance.

This will shorten the life of your mortgage, and you will be able to pay it off sooner than later.

3. Consolidate Multiple Mortgages

If you have multiple mortgages, then you may be able to consolidate them into one new mortgage. This will be beneficial because you will only be required to make one mortgage payment every month. Even better, the lower rate on your new mortgage will make your monthly payment lower, and you will be able to save money. This will free up cash flow, and paying down your mortgage will be made more attainable.

4. Utilize Your Tax Refund

A lot of Canadians wait for the tax refund at the end of the year and then use it to pay down debt. If you have a mortgage, then you can apply your tax refund to your mortgage as well. This will reduce the amount of time it takes to pay off your mortgage. Plus, you will have money to use for your other debt payments.

5. Keep Your Payments the Same When Refinancing Your Mortgage

When renewing your mortgage, you will likely be able to get a better rate on it. If you are able to get a lower interest rate, then you will want to move your mortgage to take advantage of it. However, you want to make sure that you do not get a longer-term in order to keep your payment the same. If your mortgage is shorter, then you will be able to pay off your mortgage and get rid of it sooner.

Conclusion

The sooner you can pay off your mortgage, the sooner you can start saving for other things. There are many ways to pay off your mortgage, so if you haven’t started yet, then think about using one of the above methods.

If you’re looking to apply for a mortgage, you need to find an agent that you can trust throughout the process. Ottawa Mortgage Services is the perfect partner to help you get that mortgage that suits your needs and your budget. Our team actively deals with lenders and negotiates all aspects of mortgage underwriting to make sure you get exactly what you need for your loan. Apply now and get a free assessment from a professional mortgage agent.

Forbes encouraged the public to invest in Canada’s real estate early last year. In that article, the columnist enumerated five reasons to do so. Although the blog was targeting non-Canadians, it is safe to say that Canadians should not miss out on this investment opportunity.

To enjoy this privilege, you should avail of a mortgage loan pre-approval. After all, you do not want to be left behind. However, it would help to take the proper steps to get pre-approved. 

If you do not know what to do, you should keep your eyes glued. This blog has enlisted the help of seasoned mortgage brokers in Ottawa to guide you through the loan process. They have enumerated the things to avoid, and here they are:

Paying Your Debt Late

Doing this is probably the fastest way to deny your application for a mortgage loan. Mortgages are meant for payment of the loan, not for other bills. If your payment is delayed, your application could suffer the same fate.

If you have a poor credit score, you should take corrective measures. It includes paying your existing loans, credit cards and other dues. You should also make recurring payments on your credit accounts.

In addition, you should maintain a debt-to-income ratio below 43%. In other words, your income should be able to cover your monthly expenses, including your mortgage payment.

Taking on Additional Debt

If you find it difficult to pay your debts, you should not take on more debt. You may be thinking of applying for a credit card or a personal loan. The better option is to wait until you can do it.

Before you take on a mortgage loan pre-approval, you should know that your credit score should reflect your financial responsibility. It shows the potential lender that you are capable of handling additional debt. As mentioned earlier, if you have bad credit, you should try to improve it. It is the easiest way to convince the loan provider that you will be able to pay on time.

If you have a bad credit score, the lender could hesitate to give you a loan. However, it is better to have a bad credit score than no credit score.

Transferring to a New Job

If you are employed, you should not change your job unless you have concrete chances of improvement. If you opt for a transfer, you should present thorough research about the new firm or industry. You should also know that the transfer could affect your chances of getting a mortgage loan pre-approval.

A lender is less keen to lend money if you just transferred to a new job. It is a sign that you are still looking for stability. Instead of immediately applying for a mortgage loan pre-approval, you should wait a while.

Conclusion 

You should avoid the mistakes mentioned above if you seek a mortgage loan pre-approval. It is essential to remember that a mortgage is a long-term commitment. In addition, you should make a note that you should not forget the down payment. Although there is no explicit rule about giving a 20% down payment, it would be prudent to do so. 

Now that you know more, you should talk to Ottawa Mortgage Services. We have given mortgage loan pre-approval to Ottawa residents. Take that plunge and pursue a profitable real estate investment by getting that loan from us!