Buying a home and becoming a homeowner is an exciting time in life that requires you to know a bit about the steps to get into your new home and the types of mortgages available. Knowing the many mortgage options can help you select the mortgage that’s right for you.
The 3 key areas to select from include rate type, payment schedule and amortization period (this is the length of time to pay off your new home).
Rate Types
Fixed Rate
The interest rate and payment amount are locked in over the term. Great for those who want the security of knowing their payments will remain the same.
Variable Rate
The interest rate will fluctuate with the Prime rate over the term of the mortgage. Great for those who think rates will decline so they can pay down more principal.
Fixed & Variable Rate
A mortgage with a mix of fixed rate and variable rate components. Great for those who want the security of a fixed rate with the flexibility of a variable rate.
Payment Schedules
Monthly
You make 12 payments a year due on the same day of every month. Great for those who want to keep flexibility in their budgets.
Accelerated Bi-Weekly
Your monthly mortgage payment is divided in two and that amount is due every two weeks. Great for those who want to save in interest and pay off their mortgage faster.
Weekly
Your monthly mortgage payment is multiplied by 12 months and divided by 52 weeks to get a weekly payment amount. Great for those who use a weekly budget to keep close track of their finances.
Amortization & Term Lengths
Amortization Period
25 years is typical. A great choice for first-time buyers with less than a 25% down payment.
Term Lengths
Term length can range, but many first-time buyers choose 5 years. Great for those who want to lock in their interest rate for a longer period of time.
North Peace Savings Advisors are here to support you with expert advice in deciding what mortgage is right for you. Get started today! 1-877-787-0361
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