Questions That Are Frequently Asked During the Home Buying Process
Once my mortgage application has been submitted, will I be able to make changes to the term, repayment frequency, etc.?
It can be done! If you having been working with a trusted Red Deer mortgage professional, the application you submitted was most likely already created with the perfect formula, but changes can always be considered and made if they are in your best interest.
Will I need to pay GST if I am purchasing a resale home?
There is usually no GST to be paid on a resale home. The exception to this is when a home have undergone extensive renovations. In this case, the tax is applied similarly to if the home were being purchased as a new house. *
What is an Interest Adjustment Date?
An Interest Adjustment Date, commonly referred to as an IAD, is a date that is set to cover differences between your closing date and the date of your first set mortgage payment. If you close on your house in the middle of the month but are not scheduled to pay your first mortgage payment until the beginning of the next month, an IAD is set and an amount is collected to cover the difference between these two dates.
How much will I need to put down on my purchase with a Red Deer mortgage?
The down payment amount can be affected by many factors and will vary based on your situation. In general, your down payment will need to be an amount somewhere between 5-20% of the total purchase price of your home.
High Ratio Mortgage Insurance and Mortgage Life Insurance – What is the difference?
The main difference between the two is who they are protecting. High Ratio Mortgage Insurance is used to protect the lender should the borrower default on their mortgage payments. If your downpayment is less than 20% of the purchase price, your lender will most likely require High Ratio Mortgage Insurance which will add an insurance premium to your monthly payment amount. Mortgage Life Insurance is designed to protect your loved ones in the unfortunate event of your death. Should this happen, your dependents would not be responsible for paying off the remainder of your mortgage.
If my lender will be paying the Property Taxes, how will those payments be calculated?
Your lender can pay your Property Taxes on your behalf. The amount you will owe in Property Taxes will be estimated and added to the mortgage payment. These additional funds will then be taken by your lender and paid at the necessary times on your behalf. This amount may increase or decrease depending on the current balance in your tax account as payments are due.*
* Tax information consists of general comments only, for full details see the applicable legislation or review with your advisor.