Purchasing your home is one of the biggest and most important decisions that you can make. Tammy Wandzura your Trusted Saskatoon Mortgage broker and the team at Elite Mortgage Choice believe that buying a home should also be an exciting experience with little to NO stress. By trusting your Mortgage Broker, you are ensuring that any stress you may have had in previous encounters can be eliminated!
Tammy truly believes that all you should have to worry about is opening the door to your new home for the very first time.
Here Tammy shares a tip on Fixed VS Variable- What is the FINE PRINT?
As the weather warms up and the grass & leaves turn green the Real Estate market starts cook'in!
It has already been a busy start to the Spring season - with expectations that it will get much busier.
It's the perfect time as a BUYER to have many options available on the market and as a SELLER to list and sell in the hot season.
The City of Saskatoon is estimating this year to be one of the biggest years for construction...and we are all witness to this by taking a simple drive into any of the new areas. Between new commercial spaces, new residential builds and new roads and infrastructure Saskatoon is growing by the minute!
All this while Mortgage Rates continue to stay at all-time LOWS.
The Prime rate has not increased for over 2 years; the fixed rates ranging from 2.99%-3.09% are as low as we have seen them and the Variable rate mortgage discounts are being re-introduced with Deep discounts off Prime giving borrowers the opportunity to sign into some of the lowest mortgage rates in history!
Confused on the differences between Fixed vs Variable: What is the best option for you?
There are a few determining factors:
1) Qualification: To qualify for a Variable rate OR a fixed rate mortgage under a 5 year term-you must be able to qualify at a higher interest rate. This is a federally regulated rule and can mean that not all buyers have the opportunity to consider a Variable Rate or a lower term.
2) Payment Affordability: Many home owners choose a Fixed rate mortgage as it gives them the security of knowing their payment will NOT change. With a Variable Rate mortgage your payment can fluctuate as PRIME moves.
What is MY advice?
In this Rate market it really comes down to choice and how risk adverse you may be. Some clients that may easily afford to qualify for a Variable rate mortgage simply do not feel comfortable. They are used to a fixed rate- they don't have to worry, pay attention or concern themselves with anything mortgage related until renewal.
If you have the flexibility of CHOICE and you can choose either option- I would suggest you highly weigh the pro's and cons' directly related to your application regarding the Variable rate mortgage.
The Variable rate can indeed fluctuate - however with discounts ranging from Prime-.50% (2.50% as of today) to Prime-.60% (2.40% as of today) Prime would have to jump by over 1% for you to see a seriously negative effect.
I also only work with lenders that allow my clients the flexibility of portability and transfers. Meaning if you sell your home and buy anywhere else within Canada we can look at moving or porting your mortgage to the next property. Once your renewal comes due my lenders will allow you the option of leaving them with no cost or penalty if you choose to for any reason.
I point out the above information - as it is very important to read the fine details when signing any MORTGAGE or Lien on your home.
The most recent Rate announcement of a Variable rate being offered at Prime LESS 1+% has many strings attached
Many of them you may be able to work with- but the one that is most important to consider is the non-transfer clause.
That means they are registering it as a collateral mortgage.
At renewal it is NOT transferable to a different lender that may have a better rate or product for you.
To move lenders you would be forced to do it as a refinance.
Canadian Legislation only allows you to refinance if you have 20% equity in your home. That means for new home owners jumping on this new rate- with a 5% minimum downpayment today, it is unlikely they will have built 20% or more equity in 3 short years and will be forced to renew with this particular lender. What will this lenders rates be when they know the client has no choice?
Setting yourself up for a situation where you have no choice is a scary decision.
We highly suggest you continue discussing your best options with your Mortgage Broker so that we can weigh all the pro's and con's regarding your direct situation.
Did you know it's a GREAT Idea to pre-qualify and get pre-approved asap?
Our rate holds and pre-approvals last 120 days (4 months).
Often throughout the Spring months the lenders will compete with their rates. Locking in will ensure you get the best and lowest rate from now until your possession date
I invite you to visit my website and read our client testimonials.
If you are struggling with the decision of BANK vs BROKER or which BROKER should I use; I always suggest reading the comments from real people that have used our services over the years and can report to you what our strengths are!
To all my past and current clients: Thank you so much for your continued referrals and support.
For those that didn't know I recently (1 year ago) opened a furniture and home decor store called First Avenue Furnishings
#1-511 1st Ave N Saskatoon
It has been very rewarding, a huge challenge and a huge learning curve
It has strengthened my Mortgage Business & my relationships even further- as we have created such a niche space that my clients just love!
When you come to visit you really feel warm and comfortable!
We are officially experts in everything HOME Related from beginning to end!
I hope you all have a wonderful summer! Enjoy as much time as you can with your families at the lake or on your road trips!
Any questions mortgage related- give me a call as I would be happy to help!