The Key to Selling Your Home!
Header Image

Mortgages For Canadians


Canada's major chartered banks are currently advertising five-year fixed mortgage special interest rates of around 2.56%. Homebuyers can often negotiate the interest rate for mortgage financing based on their creditworthiness and the degree to which they do other banking business with the mortgage lender.

 

The Bank also expects housing activity to remain upbeat, supported by high disposable incomes and low borrowing rates.

 

When you buy a home with less than a 20% down payment, the mortgage needs to be insured against default. This type of insurance protects the mortgage lender in case you are not able to make your mortgage payments. It does not protect you.

 

WHAT TYPE OF MORTGAGE IS BEST FOR YOU? 

• Fixed-rate mortgages: Your interest rate is locked in for a specified period called a term. Your payments stay the same for the mortgage’s term so you will not pay more if interest rates increase over time. 

• Variable rate mortgages: The rate of interest you pay may change if rates go up or down. 

• Conventional mortgages: Require a downpayment of 20% or more of the property’s value. You are not required to get mortgage default insurance with a conventional mortgage. 

• Closed mortgages: The mortgage cannot be paid off early without paying a prepayment charge. 

• Open mortgages: A mortgage that can be paid off at any time during the term, without having to pay a charge. The interest rate for an open mortgage may be higher than for a closed mortgage with the same term. 

 

WHAT MORTGAGE FEATURES ARE BEST FOR YOU? 

• Portable mortgages: If you sell your existing home, you can transfer your mortgage to your new home while keeping your existing interest rate. You may be able to avoid prepayment penalties by porting your mortgage. 

• Prepayment privileges: You can make lump-sum prepayments or increase your monthly payments without having to pay a charge. This can help you pay off your mortgage quicker and save on interest penalties. 

 

HOW OFTEN CAN YOU MAKE YOUR PAYMENTS? 

• By switching from monthly payments to accelerated weekly or biweekly payments, you can pay off your mortgage faster. Explore your options for mortgage payments and see how much interest you could save by using FCAC’s Mortgage Calculator Tool at: www.fcac-acfc.gc.ca