HawthorneVillager.com

Hawthorne Village (Milton) Discussion Board
It is currently Thu Apr 18, 2019 5:36 am

All times are UTC - 5 hours




Post new topic Reply to topic  [ 19 posts ]  Go to page Previous  1, 2
Author Message
PostPosted: Fri Mar 04, 2016 6:27 pm 
Offline

Joined: Tue Nov 17, 2015 8:33 pm
Posts: 61
vannar14 wrote:
Hello everyone,

I just wanted to clarify something. We've just bought a house and it'll be closing in 2016.

Numbers below are just hypothetical.

Why do penalties matter. For example if we get a $600000 mortgage at a fixed rate of 2.5 for 5 years.

1. Aren't we allowed to do a lump sum payment every year based on the $600000 amount.
2. Also how much can one increase the bi-weekly payments by (if the original payment is $1500 bi-weekly).
3. Can you do both of the above?

Depends on your product you can do both of the above, some will give you the option of doing the 20+20 prepayment without penalty, where the first 20% means the yearly increase you can make on your regular bi-weekly payments and the second 20% is the yearly total lumpsum payment based on your original mortgage amount. When your mortgage is matured(your 5yr term is done), you can make any payment you want, even payoff your mortgage and that is without penalty just a discharge fee of around $372. There is also a product that will just give you a 10+10 prepayment option for the same 5year term, this particular product offers a little bit lower interest rate than the other one that gives you more flexibility..

Lastly, if at the end of 5 years (when its time to renew), we have enough money to pay off the house completely, would we still have to worry about the penalties etc?

Thank you in advance for the help.

_________________
HSV | Phase 6
Pelham | English Manor
New Closing Aug 31, 2017




Image


Top
 Profile  
Reply with quote  
PostPosted: Tue Mar 22, 2016 7:52 pm 
Offline

Joined: Thu May 28, 2015 9:12 pm
Posts: 7
Gjeny is correct it all depends on the product you have. Generally the big banks give all the prepayment privileges. What you need to always be aware of is the fine print and clauses that mortgage lenders outside of the big banks have. Their low interest rates/promotions come with a price. It's unfortunate to see some of situations clients are put in.

_________________
Robin Shiwsankar | Home Financing Advisor
__________________________________________
Scotiabank | Home Financing Solutions
T: 647 886 1214 F: 905-636-1354
robin.shiwsankar@scotiabank.com


Top
 Profile  
Reply with quote  
PostPosted: Tue Mar 22, 2016 9:01 pm 
Offline
User avatar

Joined: Wed Jul 21, 2010 6:14 am
Posts: 62
Location: Milton, Canada
Hi Robin
It took me a long time to decide whether I should respond to your post or not.

If the big banks were so forth coming with their prepayment privileges, penalty calculations, mortgage insurance, terms and conditions especially with their low rates and promotions, then maybe the mortgage brokering community would be freely placing business with them. It's the many banks outside of the big banks that offer a much more transparent process often with much lower penalties, flexibility and better prepayment privileges.

The 2015 CMHC Mortgage Consumer Survey highlights the trends...
"Mortgage broker market share is trending upwards for most market segments. This is particularly evident among repeat buyers where market share has increased from 32% in 2012 to 42% in 2015. Over this time period broker share has also increased among First-time buyers (48% to 55%) and refinancers (27% to 33%)."
Source: https://www.cmhc-schl.gc.ca/en/hoficlin ... re/mocosu/

As industry professionals, as I am sure you would agree, our focus at all times can only be the most suitable, cost effective, flexible product sourced from multiple banks for the people we have the privilege of working with to get them mortgage free as quick as possible.

Yours sincerely

_________________
Warwick Johnston
Milton Mortgage Specialist at RBC
647-274-6029


Top
 Profile  
Reply with quote  
PostPosted: Wed Mar 23, 2016 9:22 am 
Offline

Joined: Thu May 28, 2015 9:12 pm
Posts: 7
I really don't want to get into Bank vs broker. Anything said will look negative which is not the point of these forums.

As for you post, I have several brokers that send their clients to me due to the fact they do not have access to the big banks, and they want to do what is best for the client. As you know the reason most brokers don't send business to the bank's is because they can't. Brokers have been given a bad name due to their fraudulent practice. There are only a couple Banks that still work with brokers for that reason.

I won't get into stats, as professionals, we should be giving our clients all the options. Brokers say they price several institutions but most don't, they go to their favorite, you know the one that pays the most.

I'm with the bank so I only have the options they have to offer. I never stop the client from pricing/ comparing with other Lenders. I advise to do so.

As for CMHC, they are correct. Banks have also been given a bad rep. "They don't lend more to people anymore or its really hard". Of course they lend money how do you think they make their billions? (this is also a touchy topic for me) I have recently sat down with genworth and Canada guaranty, both indicated that to date, they have seen a swing from brokers back to the banks!

My advice to people, do you due diligence! Make sure your broker is checking all options, which includes the bank. If the broker does not deal with banks find out why, and check with your bank. A client should never feel pressured when it comes to their biggest investment. All the info needed is on the Web, if it's too much to read, call a pro and get your answers.

Mortgagesource, I am sure we both are looking out for the people. As I love to say,there is no cookie cutter approach to mortgages. I'm sure we both will have products that will be superior but that will always depend on client.

_________________
Robin Shiwsankar | Home Financing Advisor
__________________________________________
Scotiabank | Home Financing Solutions
T: 647 886 1214 F: 905-636-1354
robin.shiwsankar@scotiabank.com


Top
 Profile  
Reply with quote  
Display posts from previous:  Sort by  
Post new topic Reply to topic  [ 19 posts ]  Go to page Previous  1, 2

All times are UTC - 5 hours


Who is online

Users browsing this forum: No registered users and 1 guest


You cannot post new topics in this forum
You cannot reply to topics in this forum
You cannot edit your posts in this forum
You cannot delete your posts in this forum
You cannot post attachments in this forum

Search for:
Jump to:  
Powered by phpBB® Forum Software © phpBB Group
[ Time : 0.129s | 13 Queries | GZIP : Off ]