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If you're a millennial and you're looking to buy your first home in Ontario, then it is no secret that buying a home in Toronto is a challenge. The city's housing market is competitive, and prices have soared over the past fifteen years.

The right approach when investing in Toronto real estate can make a tremendous difference in your adult life. This goes for both buying as an investment or primary residence, and it's important that you take the time necessary to avoid making mistakes that will cost you later down the line.

So, to help you get started on your homeownership journey, we've put together a few tips for buying your first home in Toronto.

1. Do your research

The first step to buying a home in Toronto (or anywhere, for that matter) is to do proper research and not rush into things. It's important to be aware of the different neighbourhoods in the city, as well as their pros and cons. For example, you might want to be close to downtown for easy access to work and nightlife, but you'll have to pay a premium for that convenience.

You should also research the different types of homes available, from detached houses to condo units. Each option has its own set of advantages and disadvantages, so it's important to decide what's most important to you before beginning your search.

2. Get pre-approved for a mortgage

Once you know how much you can afford to spend on a home, the next step is to get pre-approved for a mortgage. This will give you a better idea of what your budget is and will make the home-buying process much easier. Keep in mind that you'll need to have a good credit score in order to qualify for a decent mortgage rate.

If you have bad credit and want to buy a home, options are still available. You can get a cosigner for your mortgage, or look into credit home loans that specifically help individuals with bad credit. However, this is a much more complicated process and you will have to pass multiple stages of screening prior to getting approved.

3. Work with a real estate agent

While you're not required to work with a real estate agent when buying a home, it's definitely recommended. A good agent will be familiar with the Toronto housing market and can help you find the right home for your needs and budget. They'll also be able to negotiate on your behalf and handle all of the paperwork involved in the home-buying process.

4. Be prepared to make a quick decision

Though it's important to take your time exploring options, when you find a home that you're interested in, it's important to be prepared to make a quick decision. The Toronto housing market is highly competitive, and homes often receive multiple offers. If you wait too long to put in an offer, there's a good chance that someone else will beat you to it.

5. Have a down payment saved up

In order to get a mortgage, you'll need to have a down payment saved up. The minimum down payment for a home in Canada is 5%, but if you can afford to put down more than that, it will help you get better mortgage terms.

6. Consider a fixer-upper

If you're having trouble finding a home within your budget, you might want to consider buying a home that needs a bit of work. These homes are usually much cheaper than move-in-ready homes, but they'll require some work on your part. It's important to factor in the cost of renovations when considering a fixer-upper.

7. Get a home inspection

Before making an offer on a home, it's important to get a professional home inspection. This will help you identify any potential problems with the home that you might not be aware of.

A proper home inspection prior to purchase should include:

• A thorough examination of the home's exterior, including the roof, gutters, downspouts, and flashing
• An inspection of the home's interior, including the walls, ceilings, floors, windows, and doors
• A check of the home's HVAC system
• An inspection of the home's plumbing system
• Inspection of the home's electrical system
• Structural integrity and foundation

8. Get homeowners insurance

Once you've bought a home, it's important to get homeowners insurance. This will protect your home in case of damage or theft. Homeowners' insurance is typically required by mortgage lenders, so be sure to shop around and compare rates before choosing a policy.

9. Prepare for the financial stress test

As of October 17, 2016, a new financial stress test is mandatory for all insured mortgages in Canada. This applies even if you make a 20% down payment or more! The requirement was put into place to ensure that Canadians can afford their payments even when mortgage rates go up, which has happened recently due to increases in historic lows across many countries including our own Bank Of Canada.

You can prepare for the financial stress test by:

• Calculating how much your monthly mortgage payments would be if interest rates increased by 2%
• Make sure you have enough money saved up for a down payment and other closing costs
• Plans and intent on working on improving your credit score

10. Make sure you find the right mortgage professional

You will want to be sure you are getting the best mortgage terms available in Toronto, which is why working with the right mortgage professional is key to successfully purchasing your new home. Choosing the right lender will help you understand all of your options and make sure you are getting the best deal possible for your home.

Canadalend is dedicated to getting you the best rates and services available. Our agents ensure that we always provide our clients with competitive, high-quality products tailored specifically for them so they can feel confident about their decisions while enjoying a seamless mortgage process!

For more information about how you can own a home in Toronto with affordable and reliable mortgage rates, call Canadalend at 1-844-586-0713 or contact us today!

Mortgage brokers are experienced and knowledgeable financial advisors in the housing industry. These professionals can guide you throughout the entire mortgage process including pre-approval, finding a house, your mortgage application, underwriting, commitment processing, pre-closing, closing, and (potentially in the future) refinancing.

Every mortgage broker in Canada goes through specialized training and licensing in order to receive official qualifications. Continue reading to learn more about the advantages of using a broker for your home equity loan.

What is a mortgage broker?

A mortgage broker assists prospective homeowners in securing reliable home equity loans approved in the home-financing industry. These professionals work with both the lenders and the individual in order to find the perfect loan. Their primary goal is to find multiple mortgage options and present you with the top recommendations.

Additionally, they can help throughout the entire application and closing process, and ensure that you submit valid paperwork. If you have any questions about loans and financing, you can ask your mortgage broker for information. It is their job to explain both the process and the different loan options to you in detail.

What does a mortgage broker do?

Brokers have advanced expertise in finding the best loans based on your current income, credit history, and market. They are especially beneficial for first-time homeowners who don’t have any previous experience with the complicated process of buying a home.

Mortgage brokers can also negotiate interest rates and terms with potential lenders that can save you thousands of dollars in the long run, and help you reach the amortization period faster.

What are the top benefits of using a mortgage broker?

1. Access to a network of lenders

Mortgage brokerage companies have built trusted relationships with a large network of lenders. This gives you a much better chance of finding a home equity loan suited to your specific financial needs. Brokers have decades of experience in equity financing and have many connections in the home-financing industry.

2. Less stressful for our clients

Not only is finding a home incredibly stressful and full of red tape, so is finding a quality mortgage. This should be an exciting time for you, and the last thing you should be worried about is getting the best deal. That’s what a mortgage brokerage company is for.

While you’re finding your dream home, picturing your furniture beautifully set up, and imagining a future, your broker can be dealing with the logistics. They will present you with the most affordable options, review your finances with you, and help you come up with the wisest financial decision.

3. Can save you money

Going directly to a financial institution isn’t always the best option as interest rates can be very high. Mortgage brokers have your best interest at heart, and will be determined to find you the most favourable offers. This can save you money now and down the road. They can assess your needs and come up with the most suitable recommendations.

4. Application and paperwork assistance

Your mortgage broker will help you throughout the application process, which increases the likelihood of your application being approved. They can also bring to your attention any delays in the process and get it moving along when necessary. Additionally, you may need help with closing paperwork, which, again, your mortgage broker can happily assist you with.

5. They specialize in complex financial cases

If for any reason you have bad credit or are in a complex financial situation, working with a mortgage broker is highly advised. This can save you from extremely high interest rates at a financial institution. Mortgage brokers have specialized training to help those in challenging financial situations.

A few of the most common reasons people get turned down for a home equity loan include past bankruptcy, income discrepancies, self-employment, low-income jobs, temporary job layoff, and a poor credit score. Most banks cannot approve such large loans if you fit into one of these boxes. That being said, a mortgage broker can find a solution and help you succeed in getting approved for a loan.

When should I see a mortgage broker?

If you’re looking to get a full picture of what your mortgage options are, we recommend you contact a mortgage broker for a consultation. Whether your credit isn’t fantastic or you’re in a complex borrowing situation, a broker can give you the expert advice needed to successfully buy a home with a low interest rate home equity loan.

Many people choose to go through a mortgage broker even when they have a stable income and amazing credit due to the few commercial loans available.

Contact Canadalend for More Information

For further information about the advantages of using a mortgage broker for your home equity loan, please call Canadalend at 1-844-586-0713 or contact us online. Our team of mortgage brokers would love to help you find and finance a home with equity that works for you.

Canadalend has access to a vast network of banks, credit unions, and private lenders. Our agents have specialized industry knowledge that will guarantee that you get the best rates available. We look forward to hearing from you soon and assisting you as you find your dream home!

Many Ontarians have been thinking about how they could enrich their present lives and secure their future through acquiring a second home. Does this sound like you?

Whether it be a pied-à-terre-style home away from home, or a lakefront cottage for those much-needed escapes from the city, a secondary property can provide homeowners with a foundation for new amazing memories, all while securing additional long-term profits and a diversified investment portfolio.  

However, how exactly can homeowners in Ontario go about financing an additional home? In this article, our experts at Canadalend.com will discuss some of the options available when it comes to financing your secondary property, so you can reap the rewards starting today.

Option One: Refinance Your Current Mortgage

In most cases, the best choice available is to refinance one’s current mortgage (a.k.a., breaking the mortgage early) in order to gain access to funds to purchase a second property. Referred to as the “first-position charge on the title,” this loan will generally come at the lowest rate when compared to other loan types. If a borrower chooses to refinance their current mortgage, however, they should be aware that there are penalties for paying out the mortgage loan ahead of its renewal. That’s why it’s important to go over these numbers with a Canadalend.com mortgage advisor prior to making your decision, so you know exactly what to expect.

Option Two: Use Your Home Equity as Security Against a Second Loan

If refinancing your current mortgage is not feasible, it is possible to tap into the equity you’ve accumulated in your primary residence. Then, you can use this home equity as security against an additional loan.

Understanding Home Equity

Briefly, home equity is the amount of property that a borrower owns as they continuously pay their mortgage down. This appreciates in value along with the price of the residence. The prices of homes will generally rise each year, so as homeowners continue to pay down their principal loan balance, their stake in the property simultaneously increases. It’s standard for borrowers to wonder whether home equity can be used to purchase a secondary property. While the answer is “yes,” the amount of equity that is attained in the property will have an impact on just how much money they are allowed to borrow.

Understanding the Home Equity Line of Credit (HELOC)

A common option for tapping into home equity is via a HELOC (home equity line of credit), which is a loan provided by either a bank, credit union, or alternative lender (including our Canadalend.com team) that is secured by the value of the primary home, and, therefore, coming at a relatively lower rate. In many cases, when a borrower receives their first mortgage, they will automatically be eligible for a HELOC, and it will reflect the already accumulated equity in the home. Fortunately, a HELOC is generally flexible in nature, and allows for money to be withdrawn, paid, and even borrowed again at the borrower’s convenience. Interest is only to be paid on the portion of the HELOC that is being used. Moreover, Canadians are eligible to receive up to 65% of the value of their property through a HELOC. However, the balance of the mortgage loan outstanding, in conjunction with the HELOC, cannot equate to more than 80% of the property’s value. Option Three: The Second Mortgage

“Second mortgages” provided by private lenders are another option but are generally used in cases where a borrower needs to consolidate debt if they’ve recently experienced the loss of a job or issues with credit health. These mortgage proceeds come in one lump sum, but also have a higher rate due to the greater risk involved. Furthermore, borrowers must reapply for another loan if they require more money beyond that initial lump sum. In some cases, homeowners use a second mortgage as a down payment on their property as a way to avoid mortgage insurance. Occasionally, taking out a second mortgage may actually be the more cost-effective route for a homeowner. For example, your primary mortgage may be locked within a fixed period, requiring you to pay a hefty penalty in order to prematurely close the deal. On the other hand, your first mortgage may even be locked in at an attractive rate. Fortunately, Canadalend.com offers second mortgages with rates beginning at 9.99%.

When in Doubt, Seek Advice from the Pros

Taking on an additional mortgage can be a major decision for many Ontario homeowners. Thus, borrowers will want to be sure they’re working alongside experienced professionals who are equipped with solutions for all of their financial needs. Luckily, when it comes time to finance a second home in Ontario, Canadalend.com’s team of licensed mortgage experts can help you to navigate the seemingly complex world of mortgage loans.

Borrowers Should Be 100% Confident in Managing a Second Property Before Purchasing

Here’s a rule of thumb for anyone to follow before they purchase a secondary property: Never sign a contract unless you’re entirely positive that your income will be sufficient enough to support it through every stage. By knowing what you can comfortably afford to spend prior to making such a major investment decision, you can make your choice more confidently and without feelings of high stress or doubt.

Thinking about buying a second home in Ontario?

If you’re considering buying a second home in Ontario, let us lend a hand. Canadalend.com grants you access to second mortgages through lenders that don’t require you to meet any strict income or credit qualifications, helping to make your dream of acquiring a second home a reality. To learn more about our financing options, or to begin your application for financing a second home, call Canadalend.com at 1-866-I CAN LEND or contact us here.

Many homeowners throughout Ontario remain in search of an experienced private lender to help them finance their mortgages.

No matter what a borrower’s specific financial situation may be while looking for such solutions, the main goal is unanimous among all householders: to profit from significant equity gains, and tap into the wealth created from their precious property.  

With that being said, homeowners may be wondering whether a private loan in Ontario is even the right option for them, especially if a loan from the bank is not feasible.

We wrote this article to help ease your concerns about private lending practices in the province, and to provide some clarity regarding whether this common financing option is right for you.

Options for Private Lending in Ontario

It’s normal for Ontario homeowners to feel overwhelmed while exploring the various mortgage lending options that are available.

By learning about the three main categories of mortgage lender types, borrowers can get a clearer idea about which type of loan will be most suitable for them. The three main categories of lenders are:

• A lenders: An A lender is the type of lender that banks classify as such. As the lender with the most strict lending criteria, borrowers must complete meticulous mortgage stress tests that have historically become more difficult to pass due to the tightening of mortgage rules. Banks also require near-perfect credit scores, along with a low debt ratio and clearly demonstrated and significant household income.

• B lenders: A B lender is the type of lender that trust companies and credit unions classify as such. While these lenders don’t require credit scores to be as high as bank lenders do (credit must be above 550), there is still a preference for household incomes that are easily demonstrable.

• C lenders: Finally, a C lender is the type of lender that private lenders classify as such. While these lenders will typically charge higher rates when compared to A lenders, they are far more flexible when it comes to negotiating private mortgage financing, even for borrowers with poor credit and/or unstable income (such as freelance or contract-based work, or self-employment).

If a borrower is struggling with poor credit, then the best route to take may be a private mortgage loan until they can restore their credit back to health. On the other hand, if a borrower has an income that is particularly difficult to calculate, then they may also benefit from private mortgage financing.

Depending on a homeowner’s individual financial situation, private mortgage lenders may offer:

• Short-term mortgage financing, which is generally a duration of 1 to 3 years.
• A quick private loan negotiation, generally within 1 to 5 days.
• Using the borrower’s property to leverage the loan against.
• Overlooking credit issues in particular cases.

Calculating Private Loans in Ontario

A private mortgage loan is calculated by taking a homeowner’s existing home equity measured from a current home appraisal, the location of the property, its general condition or state (assessed for issues such mould, water damage, etc.), in addition to the overall loan-to-value (LTV) ratio.

Private lenders tend to prefer that a borrower has a minimum of $70,000 in existing home equity. According to these lenders, the golden standard when calculating your loan-to-value ratio should be to a maximum amount of 75% LTV. This represents a green light to lend as much as 75% of the appraised value of your home.

Understanding Private Mortgage Rates

For borrowers that meet the stricter criteria of having a substantial and demonstrated income, a low debt ratio, and an impressive credit score, a bank will be able to provide competitive mortgage rates. Borrowers with less-than-ideal credit, however, can seek approval for mortgage financing through the services of a private lender, but will need to make peace with paying slightly higher rates.

More specifically, rates charged by private lenders generally range from around 7% to 12%, depending of course on a homeowner’s individual financial situation. At Canadalend.com, though, private mortgage rates start as low as 3.99%.

Moreover, private lenders will typically charge fees that represent between 3% and 6% of the complete loan cost, which (fortunately) include administration fees in addition to other costs necessitated by the lender.

Can Ontarians feel safe about seeking private lenders?

It’s common for borrowers in Ontario to have concerns regarding rules and regulations around private lending practices. The good news is that homeowners can rest assured that private lending in Ontario is regulated under the Ontario Mortgage Act, where the rules and laws apply to every type of lending, including the world of private lending.

A lender does not need to be licensed if he or she is offering mortgage lending independently. However, any mortgage broker specializing in private lending, such as the experts we work closely with at Canadalend.com, will generally be licensed.

Private mortgage lending is not only a safe financing solution for homeowners in Ontario, but is also an economically sage choice. Any borrowers with credit problems can take advantage of this financing alternative to help restore their credit, thus increasing the likelihood of achieving additional and suitable mortgage financing in the future.

Ready to start borrowing from a trusted private lender?

The most preferred method of securing a private lender is through a mortgage broker or lending specialist such as Canadalend.com. Our team of mortgage lending experts completely understands the average Ontario homeowner’s concerns and needs when it comes to financing property, and we’re here to help make the process run as smoothly as possible.

At Canadalend.com, we work alongside a number of private investors and lenders who successfully assist our clients with private mortgage financing every day.

To learn more about our financing options, or to begin your mortgage application, call Canadalend.com at 1-866-I CAN LEND or contact us here.