Register Today!

Our Blog

Jan
24
Mortgages Demystified

Mortgages Demystified

Mortgages Demystified: Qualifying
By Troy Champ

Qualifying for your first mortgage these days can be confusing but we'll help every step of the way. This series of postings will give you the basics so that you know what to look out for but an experienced mortgage advisor will make the process easy.

Qualifying guidelines will be covered in this post. Types of mortgages, mortgage terms, down payment and repayment options, and mortgage insurance will follow in future postings.

The price of home you are able to purchase is dependent upon the cash amount of your down payment, your household income and the mortgage term chosen.

 

Qualifying Guidelines

To qualify for a mortgage, a lender will want to know about your credit repayment history, especially as a first time buyer, and your ability to make the mortgage payments.

Lenders prefer a history of at least two sources of reportable credit, such as credit cards, loans, lines of credit, or student loans, for at least one full year.

In determining the amount you can borrow, lenders consider a maximum of 35% of your gross income that can be allocated towards paying your mortgage, property tax, 50% of condo fees and $100 heat payment per month. For example, if your monthly income is $4000, the maximum payment amount towards the mortgage, property tax, and portion of condominium fees and heat - a lender will permit is $1400.

In addition, no more than 42% of your gross income can go towards paying the mortgage plus any other monthly financial obligations such as car loan and credit card payments.

For your first meeting with a mortgage advisor, you should bring verification of your income; prepare an updated list of any outstanding loans and credit card amounts and the value of any assets you own such as a car. The advisor will most likely require a letter from your employer verifying your income and employment status. In addition, the advisor will run a credit report to obtain your credit score.

Visiting a mortgage advisor for mortgage pre-approval amount prior to choosing the home you want to purchase will avoid the possible disappointment of not being able to purchase the home you want.

Troy Champ has 15 years experience as a mortgage advisor and currently with Jencor Mortgage. Jencor Mortgage is providing preferred mortgages for purchasers of the ZEN in Auburn Bay townhomes.

 

Troy Champ, Mortgage Advisor
Jencor Mortgage
Cell: 403-615-9414
Email: troy@jencormortgage.com

 

 

Blog Topics: Auburn Bay, Calgary Homes, Homebuying Tips, ZEN Condos