24 Jun

Fixed vs Variable Mortgages | What’s The Difference?

Mortgage Tips

Posted by: Chanele Langevin

What is a Fixed Interest Rate Mortgage? 

A fixed interest rate mortgage means that the interest rate will remain the same throughout the term of your mortgage.  This means you will know exactly what your payments will be, what amount of that payment goes toward your principal, and what amount goes toward the interest portion.

If you are someone that does not like to take any risk or is particular about payments being consistent, the fixed mortgage is a more comfortable option.  You will always know what your payment will be and there are no surprises for the length of your term.

Now more than ever, consumers are faced with a lot of changes in their lives.  If you have a situation that requires you to “break your term” such as moving to a different location, or if you take advantage of a lower interest rate by refinancing, your current lender will charge you a “payout penalty”.  That penalty calculation is another important factor when choosing a fixed vs variable mortgage. A fixed rate may imply a penalty of 3 months interest or an “Interest Differential Penalty”, depending on which is the greater of the two.

What is a Variable Interest Rate Mortgage?

A variable interest rate mortgage may also be referred to as an Adjustable interest rate mortgage. 

With a variable interest rate, the rate will fluctuate according to the current Prime interest rate.  It can go higher, and it can go lower than the initial interest rate you signed off on with your mortgage contract.  The discount on Prime is what will remain consistent.

Historically, variable rates are the most cost-effective for the consumers. However, with higher rewards come higher uncertainty. Another aspect of variable rate is that you can “lock-in” your rate if the prime rate does begin to increase. The lender would then lock your rate to a fixed rate structure for the remaining months of your original term.

A variable rate will always accrue a 3 month interest penalty which is usually the most favourable penalty calculation if the mortgage term had to be broken due to the sale of home or refinance.   

As an experienced Mortgage Broker with Dominion Lending Centres, I am equipped with the knowledge and expertise to assess each clients’ situation and advise as to which option would be the best fit for your needs. Contact me with any questions or concerns, regarding all your mortgage lending needs.

11 Jun

Why Use A Mortgage Broker?


Posted by: Chanele Langevin

Purchasing a home may be the largest financial investment you will make in your lifetime.  In the past, there really were no options to obtain the money in order to make that purchase…you would go to your local bank or credit union and ask them for a mortgage.

Over time, the mortgage world has evolved into a much more competitive and flexible industry. As a mortgage agent, I provide professional services to be able to help you obtain the absolute best interest rate and terms to match your circumstances.  Enlisting my services eliminates the hassle of setting up meetings with different lenders (banks) to apply for a mortgage and shop the best rates.  As a mortgage specialist with Dominion Lending HT Mortgage Group, I have access to more lenders than most home buyers even realize exist. 

There is absolutely NO COST TO YOU for my services as your mortgage broker.  I receive payment from the lender (bank) with which we obtain your mortgage.  You can completely rely on me to execute all of the leg work to secure the best rate on your behalf.  In most cases it will be a rate much lower than any bank would offer if you met with them directly. 

My expertise in the mortgage industry will prove to be your best option when applying for a mortgage pre-approval.  Not only will I find you the best financing solution but will also give helpful advice regarding any debt owing, down payments, co-signors, etc.  I make myself easily available for any questions or concerns you may have, as my primary goal is to help you achieve your home ownership dream with the least amount of stress possible.