Q: Do I have to be a first time buyer to qualify for a 100% mortgage? - Anonymous

A: Absolutely not!

Q: What is your fee? - Anonymous

A: For residential mortgages we generally charge no fee. That's because we are usually compensated by the lender you choose for processing your application for them.

For commercial mortgages there is a very reasonable fee because lenders typically don't compensate in the same way as they do for residential business. In addition, commercial deals take considerably more time, effort, and expertise than residential mortgages.

Q: I have a considerable down payment but borderline poor credit. I can put 75% down payment and need a mortgage for the remaining 25%. What are my chances of getting a decent mortgage rate? - Anonymous
A: Rates depend on very specific underwriting criteria. Therefore it's impossible to generalize with this limited amount of information. For such questions, we suggest you call or email so we can understand the whole picture. Other things being equal, however, your large downpayment will work heavily in your favour.

Q: What does the term "final approval" mean? - Anonymous
A: Final approval occurs when you`ve met all the conditions in a lender`s mortgage commitment (conditional approval).

Q: What is the calculation for a typical cancellation fee on a mortgage? - Anonymous
A: If you pay off a closed mortgage early, contrary to your contract with that lender (i.e. you exceed your allowable pre-payment privileges), you're generally subject to the greater of:

  A) 3 months interest penalty; or,

  B) The interest rate differential

Here is a link by TD on how to calculate them.

Naturally, if it's an open mortgage there are no pre-payment penalties.

Q: What is a readvanceable mortgage? - Anonymous
A: A readvanceable mortgage has two parts: 1) a mortgage; and, 2) a line of credit. In a readvanceable mortgage, the lender basically gives you a new $1 loan for every $1 of mortgage principle you pay off. In other words, every time you make a payment you reduce your mortgage principle owing and your line of credit limit gets raised accordingly. Here's an article we wrote on readvanceable mortgages in case you want to learn more.

Q: Is it legal for brokers to charge a large fee for their services? Is it legal for a brokerage firm to give info to another brokerage firm to get the mortgage? - Anonymous
A: Mortgage agents are allowed to charge fees and share information according to the rules set forth by their provincial regulator and applicable federal laws. If this question pertains to Ontario brokers, for example, please contact the Financial Services Commission of Ontario (FSCO). FSCO regulates all mortgage brokers in Ontario and will be able to help you. Here is their link. You can reach them by phone at: (416) 250-7250.

Q: How can I be assured that you are a bonafide organization? Do I meet with someone? If not, how can I check to make sure everything is on the up and up? - Anonymous
A: This is a good questions that suprisingly few people ask. If you entrust your sensitive personal information to people you've never met, you better be sure they're legitamate. As with any mortgage planner, call these two sources first: 1) FSCO (our regulator); and, 2) CAAMP (the mortgage industry's self-regulatory organization).

Simply ask them if the mortgage agent and brokerage are both registered with them and in good standing. In our case, the mortgage agent is "Melanie McLister." Our mortgage brokerage (broker of record) is "Mortgage Architects."

Q: Should I lock in an interest rate or float? - Anonymous
A: It depends primarily on the client. Historically, though, you're better off to float so that is what we recommend most of the time. Email or call us to discuss your specific situation.

Q: What does capitalize interest in LOC mean? - Anonymous
A: Basically, it means that you pay your line of credit (LOC) interest each month from the LOC itself. Canadian Mortgage Trends has a story on interest capitalization that you might want to check out. Thanks for the question!

Q: What commission or fees does a direct lender/broker receive for closing a mortgage. 3% of loan's value? - Anonymous
A: A mortgage planner's compensation depends on several factors including the lender, mortgage term, and mortgage type. For conventional residential mortgages it is typically under 1% of the loan amount. The client never pays this himself. The lender does. For difficult deals that take significant effort, commercial deals, or when the lender doesn't compensate the planner directly, it can sometimes be one or two points additional.

Q: What certifications or designations does a Mortgage Broker have? - Anonymous
A: A mortgage broker can get various certifications depending on the courses he/she chooses to take. For example, the most common is the Accredited Mortgage Professional (AMP) designation. IMBA also has two new ones called the Certified Professional Mortgage Agent (CPMA) and the Certified Professional Mortgage Broker (CPMB).

Q: What is a vendor take back? What is a 7% cash back mortgage? - Anonymous
A: Simply put, a vendor take back is a 2nd mortgage held by the seller of a property. This is typically done when the purchaser cannot obtain enough financing to buy the property. By offering a VTB (as we call them in the business) the seller can sell their property and get a good interest rate on their loan.

A 7% cash back mortgage is simply a mortgage for 107% of a property's value. However, typically 4% of that extra loan is used to pay lender fees and/or mortgage default insurance, leaving the borrower with 3% cash net. Here's a link with more info.

Q: Can retired couples obtain a mortgage? - Anonymous
A: Absolutely, as long as they meet the credit requirements and can service the debt.

Q: I am a recent new immigrant looking to purchase a home in Toronto.  What is the % down payment required. I do not have credit built up yet and am not currently working in Canada. Thanks. - Anonymous
A: As little as 5% down may be required with the following qualifications:

• You must have immigrated or relocated to Canada within the last 24 months
• You must have 3 months minimum full-time employment in Canada (borrowers being transferred under a corporate relocation program are exempt)
• You must have a valid work visa or obtained landed immigrant status
• All debts held outside of the country must be included in your total debt servicing ratio

If you are not currently working in Canada, having a strong co-borrower who lives and works in Canada would help. Call us for complete details.

Q: Do you do mortgages for those who have recently went Bankrupt? What is a typical interest rate for a 5 year closed mortgage in this case? - Anonymous
A: If your bankruptcy is discharged and you've been rebuilding your credit then there are indeed mortgage options available. If your bankruptcy is not yet discharged then specific details on your situation are needed to provide an answer. If you recently went through a bankruptcy a 5-year mortgage is not advised due to the high interest rate you'd incur. Instead, we generally recommend shorter term "credit builder" mortgages. These let you swap into better-rate alternatives once your credit improves in a year or two.

Q: Does MyVMB handle mortgage renewals? - Anonymous
A: Absolutely. MyVMB planners will identify the best available renewal options, given your credit and property profile, from over 50 Canadian lenders. Before you ever consider renewing with your existing lender, first contact a professional mortgage planner (whether MyVMB or someone else) to compare your options.