Bank Mortgage Fine Print


Do you know what you're getting into?

At First Foundation one of the things we find ourselves talking to clients or prospective clients about is mortgage fine print. It's really important to learn more about the different terms and conditions that lenders include in their mortgage contracts, and how they differ from lender to lender.

Common Mortgage Terms and Conditions

These are some of the general terms and conditions that you'll want to understand when choosing a mortgage:

  • Term: how long is the mortgage contract with the lender?
  • Amortization: over how long are my payments calculated?
  • Payment frequency: how many payments do I make, and when, over the course of a year?
  • Security: how does the lender register the loan on my Title? What security, or rights, does the lender have against my property and other assets?
  • Open or Closed: Am I able to pay out my mortgage at any time? Is there a penalty? Do I have to sell my home to get out of the mortgage?
  • Penalty calculations: How are these calculated? What are the penalties and when do they apply? Under which circumstances, if any, are they waived?
  • Fixed vs. Variable vs. Combination: Does my interest rate change throughout the term? If so, why?
  • Portability: Can I take my mortgage with me if or when I move? If so, where can I take it?
  • Assumable: What rules are there about someone assuming my mortgage?
  • Annual Percentage Rate (APR): Are there any other fees, costs, or calculations that make the actual interest rate, or APR, different than the advertised rate?

Common Side Effects of Getting Your Mortgage at the Bank

By law lenders, including banks, credit unions, and monoline lenders have to disclose most of the common mortgage terms and conditions above. This is designed to protect you, the borower, from being taken advantage of. That said, there are a number of side effects that can come from getting a mortgage - especially when you go directly to the bank. Using a mortgage broker can help alleviate many of these side effects and ensure a pleasant home ownership experience. Here at First Foundation we decided that it was time to fully disclose these side effects and we call on all Canadian Banks to do the same.

Bank Mortgage Side Effects

Nervous About Bank Mortgage Side Effects?

The good news is, there's hope! You don't have to suffer. If you fear any of the negative side effects of going to the bank for a mortgage, there is help. Talk to a First Foundation Mortgage Broker today for professional, unbiased, and FREE advice. You'll be glad you did.

President of First Foundation Residential Mortgages and First Foundation Insurance. Live in Edmonton but cheer for the Riders. I have lots of kids. Follow me on Twitter @gordmccallum

Learn more about Gordon McCallum