Mortgage Tree is excited to announce our new weekly blog! This blog will be a place where we share mortgage news, tips, and advice with our customers. We want to provide you with information that will help you make the best decisions when it comes to your home loan. In this inaugural post, we would like to welcome you and thank you for visiting our Mortgage Tree website. We look forward to providing you with the highest quality mortgage services possible!
Who We Are?
Mortgage Tree is a one-stop-shop for all your mortgage needs. We are a team of passionate and experienced mortgage professionals who are committed to getting you the best mortgage products and services available. We work with some of the leading lenders in the country to get you the most competitive rates possible.
Mortgage Approval Advice:
Purchasing a home is one of the biggest investments you’ll ever make. Making it stressful and often a daunting task, if not done correctly and with care! That’s why we work hard at making sure our clients are taken care of every step of the way. Read on to find out what steps you need to do before applying for a mortgage in Canada.
- Check your credit report – A potential lender will look at your credit report before approving you for a mortgage. Order a copy of your credit report before you start shopping around for a mortgage.
- Stay within your budget – As mortgage brokers we use your financial information to calculate your monthly housing costs and total debt load.
We consider information such as:
- Your Gross income
- Expenses (living costs)
- The amount you are asking to borrow
- Your current debt
- Your credit report and credit score
- The amortization period
- Stress Test
Since June 1st, 2021, a new stress test was introduced. Banks now require that you pass a stress test to get a mortgage. This means you need to prove you can afford payments at a qualifying interest rate. The rate used is typically higher than the rate in your mortgage contract.
In general a rate 2% higher than the rate you negotiated with your lender is used.
For more information, please visit our site: https://mortgagetree.ca/mortgage-tools/mortgage-checklists/
Mortgage Affordability
Many new clients to the housing market are unsure of what they can qualify for. The general rule of thumb when it comes to mortgages is that your monthly housing costs should not exceed 32% of your gross household income, and that your total debt load (including housing costs) should not exceed 40% of your gross household income. This rule is based on your debt service ratio, which is the percentage of your monthly income that goes towards paying down debts. Mortgage lenders typically want to see a debt service ratio of no more than 32%, which means you can afford a mortgage where your monthly payments are no more than this percentage of your monthly income. However, it’s important to remember that this rule is just a guideline. Ultimately, it’s up to the lender to decide how much they’re willing to lend you based on your financial situation.
Use our FREE affordability calculator to see the amount you could be approved for: https://mortgagetree.ca/mortgage-tools/mortgage-calculators/mortgage-affordability-calculator/
Thank you for taking the time to visit our website and read our blog. We hope we have been able to answer a few questions.
Please contact us anytime we are here to help you!
Sincerely
The Mortgage Tree Team – “Your Key to Home Ownership”
https://mortgagetree.ca/contact-mortgage-tree/mortgage-team/