PRIMARY MORTGAGE TYPES

Conventional Mortgages

Conventional mortgages are home loans that are not insured by the Canadian government. Conventional mortgages are the most common type of mortgage and come in two variations: conforming and non-conforming.

Most conventional mortgages are classified as conforming loans, which simply means that the amount of the loan is within the limits set by the government agencies that back most Canadian loans. Loans that are greater than these limits are called non-conforming loans. Jumbo loans are the most common type of non-conforming loan.

Conventional mortgages are common because most prospective homeowners qualify for them. They are a great type of home loan for home buyers that don’t have special financing needs and just want a straightforward mortgage that doesn’t require extra reporting requirements for approval. However, with this type of loan, you will likely be required to pay for mortgage insurance on top of your monthly mortgage payments if you cannot put down 20% of the cost of your home at the time of purchase.

Jumbo Mortgages

As briefly discussed above, jumbo mortgages are conventional home loans that exceed federal loan limits. You’re unlikely to qualify for, or even need, a jumbo loan unless you’re pursuing a home in a particularly high-cost area. Jumbo loans can be advantageous for buyers looking to borrow more money than conventional home loans can offer, and because their interest rates tend to be competitive with those of conventional loans. However, due to the high sum of money involved, jumbo loans often have steeper, more specific requirements for qualification, such as a down payment of 10% to 20%, proof of a significant amount of assets, and an excellent credit rating.

Selling your home can be a nerve-racking process. After all, a lot hinges on the sale, such as the time frame of when you can move or when you can purchase a new home. You spend many hours keeping your home in show shape, cleaning, picking up, and making sure everything is in its place. With every showing, you hope you get an offer. Time seems to drag, until one day, an offer is received! A weight seems lifted from your shoulders. But now what?

Lisa Johnson Mortgage Services in Prince George can help. As a top-rated mortgage broker, we help people buy homes, refinance existing home, or take out a home equity loan or line of credit. With over 25 years of experience in the real estate and mortgage business, Lisa Johnson can help. Below, we’ll explain what happens after the offer is received. Contact us today for all your home mortgage needs!

WHAT HAPPENS AFTER THE OFFER

After an offer has been made, the real work begins. There are still many steps in the home buying process, and a misstep can happen at any time along the way.

A Home Inspection

After an offer on your home has been made and accepted, a home inspection is scheduled, as well as possible other inspections, such as septic systems. A home inspection is where a certified home inspector comes in and goes through your home with a fine toothed comb, meaning that he or she will be looking for anything wrong with your home, from a leaky faucet all the way to structural damage in the basement. If any major damage is found, this could be cause for renegotiation or a withdrawal of the offer.

Affordable housing is a concern in most desirable places to live, including British Columbia. When demand exceeds supply, prices rise, which makes it hard on those who are looking to buy or rent a home.

Lisa Johnson Mortgage Services offers home mortgages, as well as home refinances and home equity loans, in Prince George. An experienced and dedicated mortgage broker, Lisa Johnson specializes in helping you finance your dream home, or refinance your current one. In this blog post, we’ll examine what the speculation tax is and how it affects homeowners in British Columbia. Contact us today for all your home mortgage needs!

WHAT IS THE SPECULATION TAX?

For the vast majority of homeowners in British Columbia, the speculation tax will not apply to you. However, homeowners still need to know what the speculation tax is because a declaration has to be filled out in order to be exempt from this tax.

The speculation tax is a tax on residential property in certain parts of British Columbia of .5% of the property value. However, this tax can be more, depending on if the homeowner is a resident of British Columbia.

When looking for a mortgage, you not only want the best deal, but you also want to work with a specialist — someone who knows the process inside and out, can easily answer all of your questions, and can handle any problems that may arise during the home mortgage process. Lisa Johnson Mortgage Services in Prince George offers home mortgages for your home purchase, offers home equity mortgages, and offers home refinance options. In this blog post, we’ll discuss the difference between banks and a monoline lender. Contact Lisa Johnson today!

WHAT’S A MONOLINE LENDER?

We all know what a bank is. However, the term “monoline lender” may be new to you, although if you’re familiar with entomology, you may be able to deduce what a monoline lender is by the name. Literally, monoline lender means one line of lending, which is exactly what a monoline lender does. A monoline lender is the ultimate specialist, picking one thing to specialize in, such as mortgage services, and offering only that service. While this is great for when you want a specialist, your options may be limited with a monoline lender. Monoline can refer to the whole industry, such as insurance, one product, such as mortgages, or one service, such as credit cards.

You’ve done it! You’ve searched many homes in the home buying process, and none have stood out. Finally, you find the home of your dreams. It has everything you’ve been looking for, from granite countertops, three car garage, a large back yard for your dog and kids, and four bedrooms. You go to make an offer on your dream home, and you’re very excited. Then you find out it already has an offer on the table that has been accepted. Crestfallen, you are resigned to starting over in your dream home search. But then your mortgage broker suggests you make a backup offer and wait and see. Renewed hope! But what exactly is a backup offer?

Lisa Johnson Mortgage Services in Prince George is a mortgage broker with over 20 years of experience helping homeowners find their dream homes. In this blog post, we’ll explain what a backup offer is and how one can help you find your dream home. Contact us today!

WHAT’S A BACKUP OFFER ON A HOME?

A backup offer is usually initiated by the seller when he or she is in doubt about their original offer. Often, you’ll see an advertisement that states “accepting backup offers.” This means that if the original offer falls through for various reasons (the most common being financing cannot be obtained for the home purchase) then the second offer (backup offer) is accepted. If the home sale’s status is pending, this could mean the buyer will accept a backup offer as well.

Are you thinking of adding an addition to your home? Want to put in new flooring? Are you finally starting your own business? Using the equity in your home is a great way to pay for expenses. Lisa Johnson Mortgage Services can help. As the Top Rated Local® Mortgage Services company in Prince George, we offer home equity loans, mortgages, and home refinances. Contact us today!

WHAT IS A HOME EQUITY LOAN?

A home equity loan (or a second mortgage) is a loan against your home. There are two types of home equity loans:

1. Home equity line of credit (HELOC). This is a loan that works much like a credit card except your home is the collateral or security. The loan is for a certain amount that you can use at will and when you pay it down, that amount is available to you once again for use. Home equity lines of credit often have draw periods that these funds are available for use, typically 20 years. Then the loan expires and a new application process would begin if so desired. These loans are the most versatile of the two types of home equity loans.
2. Home equity loan (second mortgage). This loan is your typical loan, meaning once you pay it off, it disappears with no funds available for use again. Your home is the security interest.

There are lots of options for a home mortgage here in Prince George. Two options for obtaining a home mortgage are a bank and a mortgage broker. Lisa Johnson Mortgage Services is a top-notch mortgage broker company in Prince George. We offer home mortgages for home purchases, home equity mortgages, and home refinance options. In this blog post, we’ll take a look at the difference between getting your home mortgage through a bank versus using a mortgage broker, and if you’re interested in a home mortgage or home refinance, contact Lisa Johnson Mortgage Services today!

A HOME MORTGAGE THROUGH A BANK

Mortgage banks use their own funds to underwrite mortgages. Everyone in the home mortgage process (loan officers, processors, underwriters, and funders) all work for the same company. The bank will fund the loan, which may be kept in-house, or it may be sold to a mortgage servicing company.

The primary point of contact for you is the loan officer. He or she only sells the mortgage options that that bank uses, which can limit your options.

A HOME MORTGAGE THROUGH A MORTGAGE BROKER

Navigating the mortgage mortgage process can be tough. Laws change regularly and with so many different mortgage lenders and mortgage brokers offering a wide variety of mortgage products, it’s hard to keep it all straight. Working with an excellent mortgage broker such as Lisa Johnson of Lisa Johnson Mortgage Services in Prince George makes the mortgage process seamless and easy. If you’re looking to buy a home or refinance your existing home, contact Lisa Johnson today. In this blog post, we’ll review the distinction between preapproval and prequalification as it pertains to the mortgage lending process.

WHAT IS A PREQUALIFICATION?

Prequalification is usually the first step in the mortgage loan application process. In essence, you supply a mortgage broker or lender with a basic financial picture – including your debt, income, and assets – and he or she will give you an estimate of how much you can borrow. This is a quick process, only taking a few days at most. No documentation is required at this time and can be done over the phone or online. This is usually free as well. Loan prequalification for a mortgage does not involve your credit being pulled nor is it an analysis of your ability to purchase a home. Based only on the information you provide, a loan prequalification is meant to give you an idea of a price range of where to start when looking for a home. It usually is a letter from a lender or a mortgage broker who works with lenders, stating how much you qualify for in terms of a mortgage, which is based off information you provided.

Interest rate fluctuations are as much a part of life as a major car maintenance fix; they are bound to happen at odd and unpredictable intervals. The good thing about fluctuating interest rates is they can fluctuate in your favor. Lisa Johnson with Lisa Johnson Mortgage Services in Prince George has almost three decades of experience dealing with changing interest rates and how they can affect your refinancing decisions for your home. Here are some tips we’ve learned along the way.

THE BENEFITS OF MORTGAGE REFINANCE

• Locking in a lower interest rate. This is the number one reason why people refinance a home. Lower interest rates translates into lower payments, something all homeowners want. Lower payments means more money in your pocket to invest elsewhere, either in mutual funds, 401k, real estate, or a multitude of other investment opportunities.
• Changing the terms. Another popular reason for mortgage refinance is to change the terms of your loan, perhaps from a 30-year loan to a 15-year loan. This allows you to pay off your home sooner and build more equity in your home as well.
• Changing from an adjustable rate mortgage to a fixed-rate mortgage or consolidating a home equity loan. Adjustable rate mortgages have their attractions, but overall, with the unpredictable changes in the free market economy, a fixed rate mortgage is the more conservative and recommended approach for many. Furthermore, if you have a second mortgage or a HELOC (home equity line of credit) loan on your home, you may want to combine the two into one. This could save you money in the long run, not to mention the convenience of just tracking one mortgage payment.
• Cashing out equity. There are many reasons to get some cash out of your home. Debt consolidation is a great reason to get cash out of your home. Paying off debts with higher interest rates such as credit cards with cash from your home saves you a lot of money in the long run. Another great reason to take equity out of your home is to make home improvements, which increase the value of your home–a win-win situation. However, you can use the money for whatever you want such as paying for college, investing in retirement services, or taking that dream vacation to Europe.

uying a home is a big investment–likely your biggest. You want your home to be everything you’ve dreamed of–cozy, comfortable, homey, and, most importantly, affordable.

Lisa Johnson Mortgage Services in Prince George is here to help. Finding your dream home can be the easiest part. Financing your dream home can be complicated. Below, we’ll explain the steps to obtaining a mortgage, so you can be that much closer to the home of your dreams!

TIPS TO FINDING A MORTGAGE

1. Find a reputable mortgage broker. Mortgage brokers are liaisons between the buyer of a home and the financial institution (often a bank or mortgage service company) who will underwrite or finance the loan. He or she gathers all the data from the homebuyer that the lending institution needs in order to finance the home. The advantage of a mortgage broker over going to the lending institution itself is that the mortgage broker has access to multiple lenders and is thus able to obtain the best mortgage terms for the homebuyer. Lisa Johnson works diligently and tirelessly on behalf of all of her homebuyer clients to obtain the best mortgage product for them.
2. Determine the price range of your home. One of the first tasks of mortgage brokers such as Lisa Johnson is determining how much home you can afford. Once this number is obtained, Lisa Johnson will recommend the optimal home price range you want to be based on your unique situation. Lenders generally recommend buying a home three to five times of the buyer’s annual income with the standard 20% down. Of course, individual situations vary, and the best mortgage brokers such as Lisa Johnson Mortgage Services in Prince George tailor their recommendations to you.
3. Get prequalified and/or preapproved for a mortgage loan. Again, every home buyer and his or her situation is unique and what fits one person probably doesn’t fit another. Lisa Johnson will ask for some financial information for you such as annual income, other debt you may have, and amount of savings you have and how much you intend to use as a down payment. This step often goes hand-in-hand with Step 2 above. The prequalification process step, however, will give you exact numbers instead of a general idea of a price range, which can be helpful if the house you want to buy is on the bubble of affordability.
4. Get approved. Once you make an offer on a home and it is accepted and you are under contract, the real work begins. Lisa Johnson Mortgage Brokers in Prince George will find you the lowest mortgage rate and the best terms available. For example, one bank may have the lowest rate but has higher closing costs. Another bank has very low closing costs but a high interest rate. Lisa Johnson will compare all of these competing packages and help you decide what best fits your situation.