Pro tips for securing a mortgage for first time home buyers in BC

Описание: In this episode of the Home Buying 101 video series from the Homebuilders Association Vancouver (HAVAN), Shayne Ramsay, CEO of BC Housing, discusses interest rates and mortgages with Alisa Aragon, Mortgage & Leasing Expert from Bridgestone Financing Pros DLC Mountainview.
[https://yourmortgagesolutionsgroup.ca/]

What do these record-low interest rates mean to potential first time home buyers?
• It’s a great time for first time home buyers to get into the market, as qualifying rates have come down to record lows, meaning that they will be able to qualify for a little more than they used to be able to.

What do these types of interest rates mean for existing home owners?
• With these types of low-interest rates, it is definitely worth exploring the option of re-financing your mortgage if you are a home owner, to see whether this would make sense for your situation.

Should home owners or home buyers be locking in for longer-term mortgages?
• The typical mortgage term is 5-years, but due to low interest rates lenders have re-introduced 7- & 10-year mortgages, although these mortgages will have slightly higher rates. The type of mortgage you choose will depend on how long you see yourself staying in that home.

Should home buyers and owners consider a fixed or variable-rate mortgage?
• Fixed rates are fixed, meaning that you will be paying the same amount of money in your mortgage for the term of the mortgage, regardless whether interest rates go up or down. Fixed rates are also dependent on the bond market, and as the market rises and falls, so do fixed rates.
• Variable, and adjustable rates, are both dependent on the prime rate, and the overnight lending rate by the Bank of Canada.
o For variable rates, if prime rate goes up, your payments will remain the same, but you will be paying less principal and more interest, meaning that your amortization period may be extended, rather than being reduced.
o For adjustable rates, your payments may go up or down as the prime rate does.
• The type of rate you choose is dependent upon your preferences, and your goal for the property.

Has Covid had an impact on interest rates?
• Due to Covid, lenders and banks (that typically rely on money being deposited from businesses and individuals) had to approach investors and financial institutions to get more money to back mortgages, meaning that interest rates went up because these investments were more expensive than the deposited money. Although, rates have now come down, with the bank of Canada reducing prime rate.

What else should a buyer be aware of when looking to secure a mortgage?
• Although buyers focus on finding the best interest rate, it’s really about finding the best mortgage, with the best rates, and the best terms.
o How is your mortgage registered?
 Conventional versus Collateral
o Penalties
• Look at the fine print and ask a lot of questions

What is the first-time home buyer incentive program and where can people find information about it?
• This program introduced by the Government of Canada, will help you buy an existing home up to 5%, and they will help you with a new home construction up to 5 or 10%. The government will be on-title with the first-time home buyer, meaning that you are essentially buying this home with the government.

This video is presented by the Homebuilders Association Vancouver, and sponsored by BC Housing and Associa BC Incorporated.

More Great Home Buying Resources
Find Your Perfect Mortgage: : https://yourmortgagesolutionsgroup.ca...
BC Housing: https://www.bchousing.org/home
Associa BC - https://www.associaonline.com/locatio...

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