Here are the most commonly asked questions. We'll cover these and more in our consultation.

WHY USE A MORTGAGE BROKER?

BOSI Financials’ services are free! (some exceptions apply with private financing).

We will be your advocate. We offer you the best product and rates available on the market. Banks can sometimes be biased as they only have one product to sell. At BOSI Financial, we tell you the good, the bad, and the ugly.

Save time! Who has time to fill out five or more applications? At BOSI Financial, you will complete a single application and have your credit checked once! Let us save you time and shop the market for you!

WHAT IS MORTGAGE INSURANCE?

In most cases, mortgage insurance is when you put less than 20% down on a home (there are exceptions to this.) The insurance protects the lender if you default. The insurance premium is added to your mortgage and paid over the amortization (typically 25 years). Here is the cost of mortgage insurance:

5% - 9.99% Down: 4.00% Insurance Fee

10% - 14.99% Down: 3.10% Insurance Fee

15% - 19.99% Down: 2.80% Insurance Fee

There are three different insurance providers: CMHC, Genworth, and Canada Guarantee. In each case, the costs are essentially the same, and the lender chooses your insurer.

WHAT IS AN ADJUSTMENT (PROPERTY TAX AND MORTGAGE PAYMENT)?

Typically, a legal bill will cost $1200 - $1600 depending on the amount of work and the lawyer’s cost. The adjustments are additional costs added to your legal bill that are pre-payments or “adjustments” to what the seller has paid.

Here is an example:

If the seller pays their property tax in full, the payment is due in June. This one-time payment covers the property tax from January to December of that year. In this example, the property tax on the property is $3600 per year or $300 per month. The Buyer (you) takes possession of the home on July 15. This means that the seller has already paid for the property tax from July 15 – December 31 (your part of the year). You must “adjust” or repay the seller for his pre-payment. In this example, July 15 – December 31 is 183 days.

Calculation: $3600 /365 days (1 year) x 183 days = $1804.93

This means that your bill at the lawyer’s office will be at least $1800 more than expected! You will not owe any more property tax for the year (unless you must pay through the lender). You may start the TIPP program on January 1 of the following year or pay the bill in full the following June.

WHAT IS THE DIFFERENCE BETWEEN A PRE-APPROVAL AND LOCKING IN A RATE?

A pre-approval is assessing your financial situation and an estimate of what purchase price you would be approved for. A pre-approval is not guaranteed and subject to the property being accepted by the lender and the insurer (if applicable). Any changes in your financial situation may change your pre-approval amount. Before you switch jobs or add additional debts, it is best to speak to BOSI Financial. A pre-approval is valid for as long as your financial status stays the same (unless government rules change).

A rate hold is typically a pre-approval with a rate attached to it. The rate is valid for 120 days (4 months) and guarantees that rate, pending the full approval with that lender. The benefit of a rate hold is that if rates begin to rise, your rate is locked in while you search for your new home! There is no need to worry about losing your rate. Rate holds are typically held at a premium to the market.

WHAT’S THE DIFFERENCE BETWEEN BI-WEEKLY AND BI-WEEKLY ACCELERATED?

Typically, clients have the option to choose different payments. These options may include monthly, semi-monthly, bi-weekly, and weekly. The bi-weekly and weekly payments may also have the opportunity to be accelerated or non-accelerated.

Assume your payments are $1200 per month. If you wanted to pay accelerated bi-weekly, your payments would be exactly half of your monthly payment ($600) every two weeks. You must be wondering, how does that pay off my mortgage faster? Well, if you take $600 and multiply by the number of bi-weekly periods in a year (26), you would pay a total of $600 x 26 = $15,600 in a year. However, if you took the $1200 a month (original payment) and multiplied that by 12 months, you would only pay $14,400 in a year. This means that you are paying two extra $600 payments with the accelerated option. Bi-weekly non-accelerated is when you take the same amount you would pay in a year and divide it by 26 bi-weekly periods. For example, using the scenario above, $14,400 (regular monthly payments) / 26 bi-weekly periods = $553.85 instead of $600. Because of those two extra payments with the accelerated option, your mortgage is paid down approximately four years faster.

WHAT ARE THE DIFFERENT OPTIONS WITHIN A MORTGAGE?

You must receive the best advice from your mortgage broker. This is why we go through options with our clients:

Pre-payment Options
Payout Penalties
Collateral or Standard Charge
Porting Privileges
Customer Service
Customer Portal

WHAT ARE THE WAYS OF PAYING PROPERTY TAX?

Lender: You may need to pay your property tax through the lender. The lender will collect a portion of your property tax for each payment and remit it in June on behalf of the borrower.

Monthly City Program (Recommended): You may also have the ability to set up your taxes through the city. To look up the program in your city, google Tax Instalment Payment Plan (TIPP) and the city name. We recommend the TIPP program because of its accuracy and frequent payment plan.

Lump Sum: You may also pay your property tax once per year. Your property tax bill is received at the beginning of June each year and is due by June 30. The June payment covers the year from January 1 – December 31 of that year.

Do you have questions?

Call Us 1 (800) 660-3576

Request Callback