eLoan Canada

You may have heard about open mortgages or closed mortgages, and are wondering what’s the difference between both.

An open mortgage typically allows the borrower to pre-pay all of mortgage, beside renew or refinance at any time before maturity. This also means that you can switch your lenders at any time you wish. The catch is that this flexibility to pay back the mortgage whenever you like usually comes with a higher interest rate.

An open mortgage may be an ideal solution for those who know they are receiving a large sum such as an inheritance and want to put this money onto their mortgage, or are intending to sell their home in the near future. Open mortgages can also be a good choice for those whose income will vary over time, such as self-employed individuals who will exceed the pay down allowance permitted on a closed mortgage.  .

A closed mortgage typically allows you to prepay a limited amount each year without a penalty, usually between 15 to 25% of the original principal amount. This type of mortgage may also include the ability to increase the size of your regular payments, up to double in many cases.

The basic advantage of a closed mortgage is that they almost always have a better rate compared to an open mortgage, although it pays to understand the pre-payment provisions in the fine print. Looking to pay off your debt early and have a closed mortgage? This type of mortgage may be renegotiated or refinanced in most cases with a pre-payment penalty.

The details can vary from lender to lender, so its better to talk to a mortgage broker early on, when you’re starting to think about what financing is best for you. Your Mortgage Consultant will have the latest info on the product choices, rates, and recent interest rate trend in Canadian financial market.

Tips on How to Keep Your Credit Report, Credit Score and Credit Profile Healthy!

Your credit report and score is the most important financial instrument that requires you to apply for the loan you are looking for. It also determines the interest rate credit lenders will be charging you, your highest score will awards you the most economical rate and your poor score results in even dismisal of your loan application.

The Department of Finance’s rule changes for high-ratio mortgages mean that a prospective borrower’s credit rating is more important than ever when it comes to qualifying for a mortgage loan when their down payment is less than 20% of the value of the property.  Consumers need to be aware of how their credit is evaluated by lenders, and how they can work to avoid so-called bruised credit – people with a lower credit score can find themselves paying a higher interest rate, or even denied access to certain types of personal loans.

A credit report is a detailed history of how consistently you meet your financial obligations, and provides an impression of your financial health based on your credit history and past behaviour.  A credit score is a three-digit number, usually between 300 and 900, representing your overall credit-worthiness, based on personal information from your credit report and other available sources.

Both your credit report and score are important.  When deciding whether or not to grant a personal loan, credit card, mortgage loan and other lines of credit, lenders refer to an applicant’s credit report and score, along with a range of other factors such as income, employment history, business and size of down payment.

The higher your score the more likely you are to be approved for a personal loan including mortgage and receive favourable rates because the lender considers you to be a better credit risk.  Several factors are used by the two available credit agencies in Canada, Equifax Canada and TransUnion Canada to calculate credit scores:

• Debt payment history.
• Amounts owed compared to your current credit limits with lenders.
• How often you seek new credit.
• Length of time you have had credit accounts.
• Type of credit, such as car loans, business loans, student loans, lines of credit, credit cards.

Recent news from the financial industry over the past few weeks has highlighted the fact that for many borrowers nowadays, one’s credit rating is an even more important factor when it comes to accessing personal loan including mortgage credit.  By taking a few basic precautions, consumers can protect their credit report and credit score, and increase their access to better rates and a better choice of loan products.

Here are a number of steps that you can take to keep your credit report and credit score healthy:

• Pay off your debts on time – always meet due dates.
• Don’t maximum out your credit cards – up to 50% of a card’s credit limit is favorable.
• Borrow only the amount you can afford to repay.
• Numerous inquiries for consumer-type credit in a short period of time can worsen your score - make out only necessary inquiries.
• Check your credit report with regular intervals for errors, omission and mistakes to avoid unexpected problems to your credit profile.

You can obtain a copy of your credit file free from Equifax Canada (1-800-465-7166) and Trans Union Canada (1-800-663-9980).  However, these free credit reports will not contain a credit score and it’s a good idea to get both the reports.  You can order more comprehensive reports including your credit score from these companies, for a small fee.

Your financial picture changes significantly when you get a new mortgage. The purchase of a home is a major financial commitment, and how best to safeguard your investment and your family’s interests is something you have to consider.

There are various insurance companies working in Canada that offers life, critical illness and disability protection specifically designed for mortgage borrowers. You may find the insurance company by your self or you may ask your mortgage broker. Your mortgage insurance covers great number of benefits as bellow:

• Mortgage Life Protection can cover you, your partner, or up to four individuals party to the mortgage, so that in the event of a death the mortgage is paid off, along with any discharge fees.  Mortgage Life coverage is not the only life insurance you will need, but it is perfectly suited to your needs as a mortgage borrower.
• Mortgage Critical Illness Protection also pays off your outstanding mortgage balance in the event you are diagnosed with severe illnesses such as heart attack, stroke or life threatening situations like hepatitis and cancer. This coverage provides you and your loved ones with a LIVING benefit.
• Mortgage Disability Protection makes the monthly mortgage payments up to $2,000, should you suffer an injury or accident and are prevented from performing the normal duties of your job.

Protect your investment and family’s financial future with mortgage insurance! Ask your mortgage consultant or insurance companies providing mortgage insurance any question you may have, there may some conditions apply.

Treat your house as an energy system, with many parts working together. Unfortunately, lots of houses don’t work very efficiently.  Lower utility bills, improved comfort and fewer greenhouse gas emissions. These are the benefits that an energy-efficient home provides. While many energy efficiency decisions are made during the construction of your home, there are several ways you can reduce your energy costs.  The Canada Mortgage and Housing Corporation (CMHC) provides some insights into making your home more energy smart:

Air Conditioning
Air conditioners, especially individual unit models, are often a home’s largest electricity user. The best way to lower energy use for air conditioning is to reduce the need for it. The “green” building movement promotes several cost-saving ways of cooling a home, including the use of drapes and curtains to control the amount of solar radiation entering a home, as well as the use of plants for shading it.

Building Envelope
Tightening the Thermal Envelope! A house’s thermal envelope includes every item that separates the inside from the outside that may consist its roof, walls, floors, windows and doors. A house leakage makes it not even drafty but uncomfortable too, and in other words it lets precious energy dollars escape. Older homes are more likely to lose heat through the building envelope than newer ones. There are, however, cost-effective ways of reducing heat loss in older buildings. For example, applying weather-stripping and caulking around windows and doorways reduces infiltration. Adding more insulation will also improve the efficiency of the building envelope. You can install most of these energy-saving improvements at low cost with materials available from any hardware store. This approach means a substantial investment but the resulting savings are large.

Lighting
Lighting accounts for 15 per cent of all energy consumed in a residence. A cost-effective way of decreasing such costs, without compromising safety, is to replace incandescent with fluorescent lights. Fluorescent lights produce four times as much light per watt, last ten times longer, and cost one-third as much to operate.

Heating and Ventilation
Depending on location and type of fuel used, heating can be the largest component of energy use in your home. When deciding whether replacing an old furnace with a new high efficiency model is worth the capital investment, a life cycle cost analysis must be made.

Efficient Appliances
Choosing High Efficiency Appliances! Replacing old appliances with more energy efficient ones should be decided on the basis of a life cycle cost analysis. When it’s time to retire an old appliance, you can typically replace it with a new model that uses only half the energy. According to CMHC, replacing the typical outdated refrigerator will pay for itself in six years; that is in half or less than the expected life of the refrigerator. Become a energy-smart consumer to shop for efficiency and financial advantages.

Hot Water Systems
Hot water systems can account for 15 per cent of total residential energy use. The most cost-effective way to decrease this energy use is to install energy efficient flow controls in showers and sinks, which reduce the volume of water without reducing water pressure.

Creating and building an energy smart home has become a great necessity in these days; you could not even save great amount of money over your monthly expenses and utility bills by improving and maintaining your home but also increase the value of your property.

New mortgage application has an incredible number of options from which to choose. However, with shifting interest rates, it can be a confusing time for those looking to acquire, renew or refinance a mortgage. Getting the most advantageous mortgage strategy is important and this challenging task cant be solve with anybody else accept you. This is the question you should ask yourself: Do I want the stability of a fixed rate mortgage or am I comfortable with the potential risks and rewards of a variable rate mortgage?

A variable mortgage rates allow the borrower to take advantage of low interest rates where the interest rate is calculated on an ongoing basis at prime minus a set percentage where prime is the base rate that banks use in pricing loans to their most creditworthy customers.  A variable rate mortgage can pose challenges for some, such as financially stretched first-time buyers who may not be able to handle an increase in their mortgage payments that would usually accompany a significant rise in interest rates, and there are those who simply prefer the greater sense of stability that a five to ten year fixed term mortgage can provide.

Faced with today’s competitive mortgage market and a changing interest rate environment, credit consumers need access to the timely and quality information through a recognized and trustworthy source. Which can help them decide while looking carefully at their current situation and personal goals to determine which mortgage strategy will best meet their individual needs. Moreover, you should try to get an answer yourself after consulting your mortgage broker whether a fixed or variable mortgage is best for you.

Discover Personal Loan and Mortgage Products Designed for You

Canada welcomes thousands of new immigrants every year and Government of Canada along with various financial institutions is ready to help you make the change. You are definitely feeling burden and challenging in need to be in control of your money, stay in touch with home, and feel informed and secure. eLoan Canada has gathered some important information here to help make your transition a little easier.

It’s a common myth that if you are not a Canadian citizen or landed immigrant, you do not have right and qualify for a mortgage loan. The good news is that you will find various lenders offer mortgage products specifically tailored to the needs of non-landed immigrants. While most financial institutions traditionally have insisted that new immigrants provide a down payment of at least 20% to 35%, there are now lenders who offer qualifying new immigrants or those who have been transferred to Canada by an employer, mortgages which feature a much lower down payment.

According to Citizenship and Immigration Canada (CIC), The Immigration Loans Program provides refugees and protected persons with loans to cover the costs of medical examinations conducted abroad, transportation to Canada, travel documents, housing rental, telephone service deposits and the purchase of work tools, etc., on an easy to follow credit process, for more information and general enquiry you may call on the phone number: 1 888-242-2100

Moreover, if you are planning to settle in Canada you may consult with the CIC about the credit possibilities that may fit your own situation prior to the arrival and if you are a recent immigrant to Canada, contact loan and mortgage consultant to get advice on how you may qualify for personal loan and mortgage products aimed at new immigrants.

I know when I got my first client pre-approved for a mortgage loan, I was very excited to think about the very first sales incentive which I were going to receive, but all excitement was gone away when I knew that I could not get the money till it was not paid by the client. Yeah, because that pre-approval got a grace period which is known as Rate Hold and it may take 120 days to close the mortgage deal. Anyway rate hold if held my reward for so long to come to me but on the other hand lock in mortgage rate gave my client a best possible interest rate option with a plenty of time to search for an ideal home of his choice to start his mortgage loan, and I felt really happy with my clients satisfaction which passes all the excuses.

A shifting interest rate environment may cause an unpredictable situation that lead anyone to think about to adopt an option of mortgage rate hold or lock in mortgage rate, to get the best rate possible while looking for the best home of his or her choice, while pre-approval means that you’ll know how much you can afford to spend on the home.

There are various ways to enquire and apply for your mortgage pre-approval loan with a rate hold option like you may apply through a bank, a mortgage company or through a mortgage broker, choice is yours anyone of these can assist you in providing the best financing options for your borrowing need. If fixed mortgage rates rise during your rate hold period that is up to 4 months or 120 days, you’ll be already protected by the rate hold and if it falls, you’ll have access to the lower rate the competitive interest rate to adopt for your mortgage loan. Moreover, with a lock in mortgage rate you’ll have peace of mind about your mortgage rate while you look for the home that suits you the best.

According to The Department of Finance’s announcement it has been changed some of the rules for the new high-ratio mortgages in Canada, which will take effect from October 15, 2008. According to the new mortgage policy, new mortgages with government-backed mortgage insurance policies whether issued by the Canada Mortgage and Housing Corporation or private insurers, the maximum amortization period will be 35 years, and the minimum down payment will be five per cent (borrowers may borrow their five per cent down payment, but it will not be insured).

Like most of the mortgage companies have already start working their maximum amortization to 35 years for new mortgages and so do the borrower start thinking their own way, where is a possibility the mortgage application mostly effected before implication date or after? but mortgage client is out in the market due to the favorable temperature and an interest rate which is already fixed by the Bank of Canada, and who knows what it’ll be after the October 15.

OTTAWA July 15, Bank of Canada warns of inflation and slow growth that’s why bank holds steady on key interest rate that is 3%. Anyway, The combination of slow growth and high inflation is a difficult puzzle for policy makers because battling one ailment exacerbates the other.

There are various schools of thought who have been predicting on this critical issue but it’ll be normal soon, because most of the problems are seem external rather than internal economical situations. Anyhow, most of the economists already expected the same solution from the Bank of Canada like bank left its key interest rate unchanged.

In accordance with the Bank’s announcement, lending institutions in Canada are expected to keep their prime-lending rate unchanged and steady too. The prime rate used by lenders is the base rate that they use in pricing loans to their most creditworthy customers. Variable-rate mortgages, variable-rate credit cards, and home equity lines of credit are typically linked to a lender’s prime rate. Anyhow, Pricing for fixed-rate mortgages is not directly affected by bank’s decision.

Where To Apply and How You Get It! What If You Have A Bad Credit.. A Joke..

• Prayer: May God give me another social security number.
• God: Why you need another SSN?
• Prayer: God I have a bad credit.
• God: Ok I’ll give you another number, but you have to do something.
• Prayer: Thank you God but what I have to do?
• God: You have to die first.
• Prayer: And, when you’ll send me back?
• God: After collecting the bad debt.
• Prayer: God I didn’t hear about the paid labor in heaven.
• God: But, you definitely heard about the hell, I’d collect by the punishment.
• Prayer: God I was just joking, I don’t want a new number and I’ll try to pay my bad debts here and please don’t call me before the clearance certificate. May God please don’t..