Why RATE isn’t important…

What is the first thing that comes to your mind when you are thinking about getting a mortgage? If you are like the majority of Canadians you probably would say: rate.

Although rate is important in terms of getting the right mortgage, it is not the only factor you should consider when determining what mortgage is best suited for you.

Mortgage professionals have the experience and knowledge on a variety of mortgage options, and can advise you on the various advantages and disadvantages of each. This article will only touch on a few of the various options in the market, but hopefully illustrate that rate is only one piece of the puzzle.

Similar to most industries there is a large amount of jargon and idiosyncrasies that exist within the various conditions of a mortgage. At first these may appear insignificant, but if your financial situation suddenly changes these conditions may have a huge impact on what you can (or can’t) do. Take for example a condition that bonds you to the mortgage, even if you win the lottery and want to pay it out – you cannot.

On the flip side, suppose your three children are heading off to college, and you are heading for the bank (repeatedly), but the house of your dreams suddenly comes up for sale. Now some lenders allow you to amortize your mortgage over 30 or 35 years, as opposed to the usual 25 years, which means you can buy the house of your dreams and stay at a comfortable level of cash flow.

Since rate is a component of the puzzle, it should be noted that your effective rate of borrowing may be different then what you are quoted, meaning you may think you have a particular rate, but it reality it may be compounded weekly as apposed to monthly, or the teaser rate that you get for the first 3 months may increase dramatically after the initial months.

The examples mentioned above are just a few of the many mortgage options that are out there. It is always in your best interest to speak to an unbiased mortgage professional who can help you get the RIGHT mortgage.


About wojciechpianka

After a few years of studying English and History at the University of Toronto, I decided to transfer to Ryerson University and pursue a Bachelor of Commerce degree. While studying, I worked various jobs where I acquired many skills. Starting as a teller at Scotiabank, I moved on to being a manager of a restaurant, admin staff at a medical clinic, a sales agent for INGDirect and a manager at One King West Hotel. While all these jobs challenged me, I never felt my potential being utilized. Finally in 2008, I completed the Ontario Mortgage Agent Course and signed up with The Mortgage Alliance Company of Canada. This was a great decision, as it allowed me to use the skills I learned working to help people achieve their real estate and financial goals. My passion for real estate and numbers has lead me to becoming a mortgage agent. Growing up in New York City, I always had a fascination of historic buildings and skyscrapers. At 21, I bought my 1st property and have been investing in real estate ever since. I firmly believe thru steady, safe and conservative investing a one can obtain long term financial wealth. One day, I hope to develop the same buildings I help clients purchase.
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2 Responses to Why RATE isn’t important…

  1. Otis Kettler says:

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