- Intimidated by banks? Bad Credit Bureau?
- Assistance with mortgage applications or switch with up to 1.2%
discount in posted mortgage rate at the bank.
- Assistance with loan application, restructuring and consolidation
- Assistance with Islamic based financing
- Advice on credit bureau interpretation, repair and improvement
Buying a home continues to be one of the major milestones in the lives
of most Canadians. It’s also usually the trigger for another significant
rite of passage — borrowing more money than most people have ever set eyes
How Much Can I Borrow?
MoneyWI$E Financial Inc. will show you
all the ins and outs of borrowing.
We also have access to Islamic form of financing and are in the
process of developing pooled fund financing whereby each individual
will purchase a unit for $10,000. Let us say the pool will have 30
individuals, then there will be $300,000 available for the first person to
receive his/her first interest free financing. However, there will be a
$200,000 per individual qualification ceiling per family. The title will
be held in trust until the $200,000 has been paid in full. Conditions for
qualifying etc. will be the same as that of the Canadian financial system.
The above is dependent on receiving approval from the appropriate
government agencies, including the Ontario Securities Commissions.
Lending Limits: Understanding the Rules
Lenders have strict
rules dictating exactly how much they will lend you to purchase a home.
While limits and conditions put in place by financial institutions can be
frustrating, remember that they exist for a reason. Those reasons usually
lessen the risk for the lender, but when it comes to a mortgage, you’re
also being protected from borrowing more than is financially healthy for
you. It is true in some cases that you may be able to afford the payments
on a substantially larger loan than the bank is willing to make. However,
in general, those lending limits act as a kind of enforced control,
preventing you from borrowing beyond your means.
How are these limits arrived at? The amount of money you can borrow to
finance a home depends on three factors: the type of mortgage loan, the
property, and your income.
Types of mortgage:
- Conventional:you have to contribute at least 25% of purchase price
- High–Ratio :you can purchase a house with only 5% down payment
- Collateral – second mortgage:A variation on the second mortgage
theme could make it a hands–down winner. You could ask the
seller of the house to help you finance its purchase by taking back a
second mortgage (called a Vendor Take Back) at the same interest rate as
a first mortgage. This way, you save both the higher financing costs on
the second mortgage and the broker’s fee.
Your Income Level
There are two tests lenders use to compare the
cost of paying your mortgage and loan to your income: the "gross
debt–service ratio," and the "total debt–service ratio."
MoneyWI$E Financial Inc. can help you with questions such as:
- Is It Wise To Borrow the Most You Can?
- What to do when You Don’t Have a 25% Down Payment
- The Ins and Outs of High–Ratio Mortgages
- High–Ratio Financing & CMHC’s 5 Per Cent Down Program
MoneyWI$E Financial Inc. consulting fees are at least
$800 (that will include Islamic financing) per house purchase.