Frequently Asked Questions

Absolutely! Mortgage brokers are highly trained in mortgage financing, and have access to several competing lending institutions. What does this mean to you? Imagine all the grocery stores in your neighbourhood competing for your business, while you simply placed an order and went about your life! Our relationships with multiple institutions and the constantly shifting mortgage market give you the confidence that the solution we determine together is truly the most appropriate for you! Throughout the mortgage process we take on the job of learning your specific needs and finding the best possible fit for your mortgage financing needs. We also assist you in preserving your credit score, by often requiring only one credit bureau that can open up over 40 lending institutions to you, with one simple application!

Typically your mortgage specialist works on your behalf with lenders to determine the most appropriate product for you, and is paid upon completion of the mortgage, by the lender. This is at no cost to you. Anytime your MBN Mortgage specialist is acting on your behalf with private lenders or in the case of some commercial financing, a nominal fee may be applicable. Alberta real estate law requires all fees that you are responsible to pay for the placement of the mortgage to be fully disclosed to the borrower, so no surprises!

After we complete our initial conversation and determine what your specific needs are, we will request basic personal information from you such as employment, assets and liabilities, birth date and other essential information. From here we will determine what paperwork we will require, and can assist you in identifying it and gathering it all up.

Typically you will require a letter from your employer, a recent paystub, the previous year Revenue Canada Notice of Assessment and your proof of down payment. Depending on your circumstances, this may be about all that is required, or it may be just the beginning for more complex applications. Our objective is to make the task of document gathering as streamlined as possible.

Of course! MBN Mortgage is here for you. We are flexible and can accept your application via our secure online application, via secure fax, or by phone. When required, we can arrange to come to your home or office to complete your application and answer your questions. Have a special need or request? Just ask! We enjoy a challenge!

A pre-qualification is a detailed review of your mortgage financing by a mortgage professional when a formal rate hold pre-approval is unavailable by the mortgage company. A pre-approval is a conditional interest rate hold and approval in writing from a mortgage company. Both are subject to final lender approval of the property purchased.

We recommend that all buyers be pre-qualified or pre-approved to better understand the specific rates, payments down payments and terms of their mortgage. In our experience, a pre-qualified or pre-approved buyer has a stronger negotiating position when purchasing real estate and is more likely to be able to react quickly when they find that perfect home.

A rate hold typically comes as part of a pre-approval where today's rates are held for up to 120 or 180 days. If rates go up, you receive your 'rate hold', and if they go down, you will receive the lower of the two, in most cases. An excellent choice, when possible.

We aim for pre-qualifications in under 4 hours and pre-approvals within 24 hours of receiving your completed application, received during normal business hours. This may vary depending on the complexity of your application. We understand that purchasing or refinancing a home is exciting, and we want to ensure you can be shopping with confidence, as soon as possible.

Many of our clients do not need any down payment! There may be advantages to down payments ranging from 5-25% or more, but in many cases, mortgages offer cheap financing rates and are a great way to leverage your money.

This is a common question. There are two main reasons that people often wish to make a large down payment. The first is to save on mortgage insurance from CMHC, AIG or Genworth, and secondly, the more down payment you use to purchase your new home, the lower your monthly mortgage payment will be. Consider this though - on a $400,000 home purchase, a 20% down payment is $80,000. In many cases, and especially in a strong real estate market, we can demonstrate the benefits of using less down payment and taking a portion of the proceeds and investing in something that produces a higher return that the cost of your mortgage. For example, if your mortgage interest rate was 5.0%, and you could generate say, 7.0% by investing a portion of the funds, this could be a wise decision. Additionally, if you could leverage a single down payment into 2 or more properties, the overall return on the same dollars would increase significantly.

Purchasing a home with no down payment allows you to use your cash in other ways, such as improvements to the property or other purchases needed for the new home. Zero down purchases allow the purchaser to accumulate earn equity over the course of time regardless of an initial down payment. This works well in all markets, but especially in robust Canadian real estate markets.

A HELOC (home equity line of credit), is a secured, revolving open mortgage product which requires only the accumulated interest to be paid each month as a minimum payment, and is often available to be paid off in full at any time, without penalty. HELOC's are an excellent way to use your home as a piggy bank, and utilize your equity from time to time for purchases, investments or those unexpected contingencies in life.

Gifted funds from a family member as they are a common source of down payment, especially for a first home. Your MBN Mortgage specialist will provide you a gift letter template and instructions for showing the cheque or proof of deposit of funds from the proceeds of the gift to assist in the mortgage approval process.

In many cases you may be able to borrow the down payment from a credit card, personal loan or line of credit. You must however, include the payment for this loan in the calculation of all of your debts and the new mortgage payment to qualify. Secured loans, which are secured by real estate or other secured assets can also be used for down payments.

There are a number of ways we determine the best interest rate for you. A combination of factors including credit and employment status, down payment, term of the mortgage, use of the property and the amortization period all have an effect on interest rate. Generally, if a lender assesses your risk to fall within their guidelines, you will be eligible for some of the best interest rates on the mortgage market.

There are a consistently increasing number of lenders who consider self-employed Canadians with strong credit eligible for mortgage financing with as little as 5% down payment. The key to the best mortages for the self-employed is a strong mortgage specialist that understands how business and self-employed Canadians operate. We understand that there are many benefits to owning a business, and we match our clients with the most appropriate products for their situation.

Many mortgages will allow you to include in the mortgage amount renovations or improvements that increase the value of the property. In many cases you will be required to pay for the improvements up front, and the lender will advance the agreed upon finds once they have confirmed the improvements are completed. This allows purchases that may require some significant improvements, and permit them to be included in the mortgage.

The amortization of a mortgage is the length of time - the number of months or years - that the principal and interest payments of a mortgage is calculated over before it is repaid in full.

The mortgage term is the agreed upon period that a mortgage will have consistent rates, pre-payment privileges and other contractual obligations between you and the lender.

Depending on how quickly you wish to pay off the mortgage, or what your monthly budget is, will determine the most appropriate amortization for you. By adjusting amortization, you can set your total amortization and payments at a level that is comfortable for you and make your mortgage part of your overall financial plan.

The answer is yes. Fixed and variable mortgages both have advantages, but it is largely a personal choice. If you are comfortable with payments changing with the prime lending rate of your mortgage company, then variable rate or adjustable rate mortgages can be an excellent choice. Fixed rate mortgages tend to be more popular homeowners who prefer a consistent payment for the entire term of their mortgage.

A high ratio mortgage is any mortgage that is higher than 80% of the value of the property. As a borrower, you pay a small fee to the mortgage insurer, such as CMHC or Genworth, to protect the lender should you default on the mortgage. Insured mortgages are an excellent way to achieve home ownership with a small, or sometime no down payment.

This insurance is added to the amount of your loan and it is then blended into your payment schedule. These fees can be as high as 6.60% of the principal, depending on the product you need to utilize. There are several options for high ratio mortgages, and navigating them can be complex without your MBN Mortgage specialist.

Mortgage life insurance and in some cases disability insurance is available from many lenders and brokers. The primary benefit of mortgage life or disability insurance is that in the event of death or a defined disability, you may be entitled to having your mortgage paid off, or your monthly mortgage payments made on your behalf.

Title insurance is growing in popularity and protects the title to your property against many defects in survey, encroachment and can be a lifesaver in many instances of mortgage fraud. Some lenders actually require that you use title insurance to close, as it can speed up the funding and advance of mortgage funds.

You will notice on your mortgage commitment that mortgage payments are typically 'compounded semi-annually, and not in advance'. What this means is, that unlike rent or your cable bill, you are paying for the month (in the case of a monthly payment) that just passed. For example, a payment on September 1, is for August 1 - August 31.