CTV Morning Live: Mortgage Minute - January 12
Frank Napolitano of Mortgage Brokers Ottawa joins Lianne Laing on CTV Morning Live to share tips for buying a new home in this week’s Mortgage Minute.
Frank Napolitano begins this week's Mortgage Minute by discussing the five "C's" of credit. The first one is the "Credit". If your credit score doesn't meet the minimum score most lenders require, you will not obtain an approval. A great tip is to stay well below your credit card limits to help ensure your score doesn't drop due to over limits, late payments, etc..
The next "C" is "Character". Whether it is your job, repayment history, character is crucial in the lender's underwriting process. "Capacity" is the third "C". Being able to live within your means is important. Using net income vs gross income is a good way to ensure you can comfortably afford purchasing a house at a specific price and avoid being put into a situation where you are unable to begin saving for retirement or future investments.
"Collateral" is an important factor for lenders and mortgage insurers. It is common for today's lenders and insurers to request a residential appraisal report to be conducted on a property. Some lenders will request documentation from the condo corporation to ensure the financials are in place and that the reserve fund has enough money to ensure financial stability in the building's future.
The final "C" is "Conditions". In today's mortgage world, you have to come up with more documentation than ever before. A job letter, paystub and two years of tax returns for example.
It is important to speak with a licensed professional whether you are a first time buyer or have a mortgage coming up for renewal. Call one of our professional mortgage brokers today!