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Financial Success

Buying A House? Get A Mortgage With Extra $ For Renos

Buying a home and becoming a homeowner is an exciting time in life that requires you to know a bit about the steps to get into your new home and the types of mortgages available.

A great option available is the Purchase Plus Improvements Program  (PPI) which allows you to make improvements to your home immediately after taking possession of the purchased property. 

Here’s how it works:

When applying for a Purchase Plus improvements mortgage, your application needs to include a contractor’s quote for the improvements you’d like to make. This step is done upfront with the offer to purchase the home. 

The contractor’s quote does not mean we need to specify exactly what materials will be used, but just more generally what will be improved along with the cost. For example:

  • Kitchen: New cabinetry, countertops, sinks and faucets, flooring, paint and backsplash.
  • Bathrooms: New toilet, paint, flooring and vanity.
  • Basement: Finished or partially finished including flooring, drywall, mudding and paint, ceiling and lighting. 

After the home purchase is complete, you need to come up with the funds to pay for the improvements, and then after the improvements are finished, the Financial Institution will release the improvement funds back to you from the mortgage. The contract work typically needs to be completed within 90 days. 

Speak with one of our North Peace Savings and Credit Union Advisors who can see if a Purchase Plus Program is right for you. 

Get started today! Contact an NPSCU Financial Advisor at 1-877-787-0361 

Categories
Financial Success

Buying A House? Home Ownership May Be In Reach With Only 5% Down

Many people would love to buy a home, but don’t have the 20% down payment needed for a conventional mortgage.  But there’s good news. Homeownership may still be within your reach. That’s because you may be able to buy a home for as little as 5% down if you also buy mortgage default insurance.

What is mortgage default insurance?

Mortgage default insurance protects your lender if you default on the loan.  If you default on your mortgage, your lender can start proceedings to sell or take over your property. The insurance covers your lender’s losses after the property sells.

How do I get mortgage default insurance?

Your financial institution will arrange this insurance for you through Canada Mortgage and Housing Corporation (CMHC). They pay the insurance premium directly to the mortgage insurer and add these costs to your mortgage principal. You pay this insurance back to the lender, with interest, as a part of your mortgage.

Speak with one of our North Peace Savings and Credit Union Advisors who will discuss the options available to you. 

Get started today! Contact an NPSCU Financial Advisor at 1-877-787-0361 

Categories
Financial Success

Buying a House? What Type of Mortgage Is Right For You?

Buying a home and becoming a homeowner is an exciting time in life that requires you to know a bit about the steps to get into your new home and the types of mortgages available.

Knowing the many mortgage options can help you select the mortgage that’s right for you. The 3 key areas to select from include rate type, payment schedule and amortization period (this is the length of time to pay off your new home).

RATE TYPES:  

FIXED-RATE: The interest rate and payment amount are locked in over the term. Great for those who want the security of knowing their payments will remain the same.

VARIABLE RATE: The interest rate will fluctuate with the Prime rate over the term of the mortgage. Great for those who think rates will decline so they can pay down more principal.

FIXED & VARIABLE RATE: A mortgage with a mix of fixed-rate and variable-rate components. Great for those who want the security of a fixed rate with the flexibility of a variable rate.

PAYMENT SCHEDULES:

MONTHLY: You make 12 payments a year due on the same day of every month. Great for those who want to keep flexibility in their budgets.

ACCELERATED BI-WEEKLY: Your monthly mortgage payment is divided in two and that amount is due every two weeks. Great for those who want to save in interest and pay off their mortgage faster.

WEEKLY: Your monthly mortgage payment is multiplied by 12 months and divided by 52 weeks to get a weekly payment amount. Great for those who use a weekly budget to keep close track of their finances.

AMORTIZATION AND TERM LENGTHS

AMORTIZATION PERIOD: 25 years is typical. A great choice for first-time buyers with less than a 25% down payment.

TERM LENGTHS: Term length can range, but many first-time buyers choose 5 years. Great for those who want to lock in their interest rate for a longer period of time.

Speak with one of our North Peace Savings and Credit Union Advisors who will find the right mortgage for you. Get started today! Contact an NPSCU Financial Advisor at 1-877-787-0361