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        <title>Real Estate Blog</title>
        <link>https://www.cochranerealestate.ca/blog/2017-06/</link>
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    <guid>https://www.cochranerealestate.ca/blog/what-to-know-about-different-mortgage-types.html</guid>
    <link>https://www.cochranerealestate.ca/blog/what-to-know-about-different-mortgage-types.html</link>
        <author>justin@justinhavre.com (Justin Havre Real Estate Team)</author>
        <title>What to Know About Different Mortgage Types</title>
    <description> <![CDATA[ 





When applying for a mortgage, you might be surprised by the amount of options you have available. From a capped rate mortgage to a high ratio mortgage, buyers need to understand what these loans could mean for their finances. This guide identifies the most common types of mortgages, how they differ from each other, as well as other terms buyers should know.


1. Open vs. Closed Mortgages


The way that you pay your mortgage will depend heavily on whether or not the loan is open or closed. A closed mortgage often carries a lower interest rate, but it places several restrictions. With a closed loan, you may be limited to making the specified payments. If you attempt to refinance the mortgage or pay off the remainder before the end of the term, you can expect prepayment penalties in a closed mortgage. In exchange for a higher average interest rate, an open mortgage allows you to make extra payments or pay off the balance without fines. An open mortgage may be more appropriate if you expect to have extra money to devote to the mortgage.


2. Conventional vs. High Ratio Mortgages


The standard for a down payment on a mortgage is at least 20 percent. If you can make this kind of down payment to buy a home, you are typically eligible to apply for a conventional mortgage. However, a lot of prospective borrowers cannot gather the funds to make a large down payment. Buyers who make a smaller down payment must pay to insure their mortgage with an organization providing mortgage insurance, such as the Canada Mortgage and Housing Corporation. If you make a lower down payment and have accumulated 20 percent in equity by the end of the first term, you may not have to pay for insurance afterward.


3. Capped Rate vs. Variable Rate Mortgages


There are also different ways to consider the interest rate during the period of the term. Buyers could have a mortgage with a capped rate or a variable rate. Capped rate mortgages have one interest rate for the full term of the loan, although that interest rate may be slightly higher. Variable rate mortgages may have a fixed payment or an adjustable payment. If you choose a fixed payment, you will have the same payment every month. If your interest rate changes, you may put more or less of the money toward the principal of the loan. With an adjustable payment on a variable rate mortgage, your payment could rise or fall depending on the change in interest rate. In this type of loan, the amount going to principal remains the same.


4. Mortgage Terms and Amortization


With every loan, buyers should consider the difference between the loan term and the amortization. A standard loan term may range from 6 months to 10 years, after which you must renew the loan with your lender or refinance the loan with a new lender. You may have new requirements for the loan on the new term. Amortization refers to the amount of time you have until the mortgage is fully paid. For a new mortgage, amortization can range from 25-35 years, with a 25-year limit for any mortgage insured by CMHC.


Getting a mortgage – whether it's for a listing in Bow Meadows or a vacation home on the other end of the country – requires a lot of research, particularly as it relates to the type of mortgage that works best for you. With this information, you can understand the terms that a lender presents, and make the choice that is most appropriate to your financial situation.


 ]]> </description>
    <pubDate>Fri, 30 Jun 2017 08:18:00 -0600</pubDate>
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    <guid>https://www.cochranerealestate.ca/blog/downsizing-4-tips-to-transition-to-a-smaller-home.html</guid>
    <link>https://www.cochranerealestate.ca/blog/downsizing-4-tips-to-transition-to-a-smaller-home.html</link>
        <author>justin@justinhavre.com (Justin Havre Real Estate Team)</author>
        <title>Downsizing? 4 Tips to Transition to a Smaller Home</title>
    <description> <![CDATA[ 





The kids have left the nest and the home that was once just the right size now feels three sizes too large. Even worse, as utility rates, property taxes, and insurance premiums continue to go up in most areas of the country, living in a home that is too large can become a huge financial burden for empty nesters. Homeowners who are currently living in a home that is too large for your needs and your budget and would like to downsize into a home that is just right for your situation but don't know where to start, the following four tips will help.


Selecting a Location


Making the decision to downsize offers homeowners the perfect opportunity to choose a new home location that will be more beneficial to them. Before deciding to move to a new city or town or stay in the same area general area, take time to consider important factors for each possible location, such as: 




Where children, grandchildren, extended family, and friends are located now and into the future


Possible locations that would be enjoyable for living due to opportunities to take part in activities of interest


The cost of living in the area, including costs for utilities, property taxes, groceries, and other basic needs


The availability of quality medical care in the area 


The cost of housing and overall stability of the local real estate market




Remembering to focus on important basic factors, such as these, will help to ensure that downsizing homeowners will choose their new home in an area that will be both comfortable and enjoyable for them throughout the years to come.


Determine New Household Needs


Most downsizing homeowners are of an age where it is important to consider their overall health and mobility when choosing a home to purchase. This can mean looking for a home that is all on one level or one that offers mobility enhancements, such as an elevator or a home that can be easily modified, should the need arise.


Pare Down Possessions


Moving from a home where a family has been raised can mean dealing with the veritable mountain of furnishings and personal items that have accumulated in it. In order to make the downsizing process as painless as possible, homeowners should consider taking time to sort through each room and donate or sell all the excess well before putting the home on the market. If the appliances are older, it may also be much more cost efficient to leave them with the home being sold and order new ones that will better fit the future smaller home.


Consult a Real Estate Professional


Selling your current home and finding a smaller one that will be comfortable and convenient is easier when relying on the knowledge, expertise, and guidance of a successful real estate professional who specializes in helping empty nesters, seniors, and retirees downsize into smaller, more convenient homes. Their industry knowledge can help downsizing homeowners take advantage of market trends to get their too-large home sold quickly while also helping them find and purchase their next home to make the move as seamless and efficient as possible. 


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    <pubDate>Fri, 16 Jun 2017 11:04:00 -0600</pubDate>
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