Five points to consider before you list your home.
There are several things to consider before you take the plunge and put your home up for sale. This might sound obvious, but the first step is to call your mortgage broker, not your lender directly or your realtor. You don’t have to look long for an unfortunate story of someone who didn’t understand their portability, penalty or transfer costs. Here’s how you avoid this scenario.
1.The anniversary date of your mortgage will depend on your penalty. If you are in a variable rate you usually will pay 3 month’s interest payment. In a fixed rate, it can be up to one to 4.5% of the outstanding mortgage balance. Remember we can estimate things, the only guarantee you will have of your penalty is when the lawyer requests the payout statement.
2.Just because a mortgage says its portable doesn’t mean you don’t have to completely re-qualify. Changing properties means complete re-qualification of everything; credit, income and property. Less than one per cent of mortgages actually get ported due to the changes in the market, or your circumstances.
3.If you have accumulated outside debt, you may not even qualify to purchase for more due to recent rule changes. You’ll need clarity on what the approximate net will be after anything that is required to be paid out to improve qualification.
4.If you list your property and want to buy first or need money for a deposit, you may need to change your mortgage first which you won’t qualify for if your property is already listed. This happens frequently when people who are downsizing are selling their home.
5.Making a purchase requires a deposit that later forms part of the down payment, so understanding this before you go out shopping helps you plan for it
A little preparation helps the process go more smoothly, and we are here to help.
The best mortgage plan is one that is developed by assessing your goals and life stage. The Angela Calla Mortgage Team will help you personally call us at 604-802-3983 or email callateam@dominionlending.ca to contact Angela Calla directly call 604-802-3983 or visit www.angelacalla.ca.
