A 7-Step Guide To Choosing The Best Bank Mortgage Rate In Canada
If you are looking for the best bank mortgage rate in Canada, there are several things that you need to take into your careful consideration. Considering the overwhelming range of options out there, you may find it a difficult task to make an informed decision on which option is going to be the best possible choice for you. So, a thorough comparison-shopping is must. You need to take a systematic approach while you are researching the different options available out there. Following is a brief rundown on some of the important steps that you should follow in this regard. Check Your Credit Report:
The first thing that you have to do is check your credit report. There are credit agencies that maintain this record for consumers. You can contact these agencies and request for a free copy of the report. Check these reports thoroughly for errors and mistakes. If there are any issues with them, get them fixed properly before you start your research for the best bank mortgage rate. Sometimes, the reports show a bad credit score just because of certain errors. Therefore, it is important for you to make sure that there are no mistakes and that the score reflected by the report is 100% correct. Always remember, a good credit score is the key to getting the best deal in mortgage rates.
Determine The Amount Of Money You Need:
The actual amount of money that you need to borrow depends upon an array of factors, such as the amount of money you are capable to pay as down payment, the kind of house you are buying, and where exactly the property is located. You must also be willing to pay at least 20% down payment because otherwise you may be asked to pay additionally for private mortgage insurance.
Evaluate The Fees And Mortgage Points:
Most banks in Canada charge the fees for underwriting a mortgage in the form of points. Therefore, it is important for you to review and compare the points offered by different banks. Remember, just because a quote reflects a very low mortgage rate, it does not necessarily mean it is the best choice for you. You must also study the applicable points and fees to get the true picture.
Calculate The Mortgage Payment:
The actual mortgage payment may vary significantly depending upon whether you are opting for fixed or adjustable rates. Both the options have their own pros and cons. Fixed rates are fixed for the complete loan term. ARMs on the other hand offer a low rate in the beginning, which can further go up or down in the following years depending upon market conditions.
Shortlist 3-4 Banks And Request For Free Quotes:
The next step is to shortlist at least 3-4 banks that are well reputed in the industry. Contact each of them and request them to send free mortgage quotes to you. You can place this request online through their official website, on phone, or by paying a personal visit to their office. Do not pay anything to obtain the quotes. Reputed banks in Canada must provide you no-obligation quotes free of cost.
Compare Quotes From Different Banks:
Once you get the quotes, the next thing that you have to do is compare the terms and conditions thoroughly. Some important factors that you must take into account in this regard include fees, points, rates, and mortgage payments. You also need to compare the offers based on the type of rates offered. The adjustable rates may prove to be a good choice for those who are looking for low monthly mortgage payments for the initial few years, but they must also be ready to deal with the uncertainties of the future. On the other hand, if you are one of those who do not want to take any risk, you had better go for a fixed rate mortgage.
Obtain Estimate Of The Costs Associated With Loan Origination:
Many people often forget to look into this aspect when they sign up for a mortgage program. Therefore, make sure you ask your bank to provide you an accurate estimate on the overall costs associated with the mortgage loan origination.
Overall, if you follow these seven steps thoroughly, you should not have much difficulty in choosing the best bank mortgage rate in Canada.