Now Offering
In-Person &
Virtual Meetings

Book Now Book Now

Don’t Wait Until You Can’t: The Mortgage Approval Process

Don’t Wait Until You Can’t: The Mortgage Approval Process

Mortgage Approval

Mortgage qualifying in Canada has become much more difficult over the past few years, the Canadian government has been tightening mortgage policies in an effort to cool the real estate market. This has put much stress & aggravation on some Barrie home owners, who in the past, have easily qualified for the mortgages they needed. One area of qualification that has virtually disappeared is that of equity lending. Home owners used to be able use only the equity in their property to qualify for a mortgage, there was no need to prove their income or their ability to meet their ongoing monthly mortgage obligation. This has had a devastating impact on retired pensioners and home owners who face sudden illness or unexpected job loss.

One mortgage strategy which can avoid this situation is to qualify for a mortgage before a negative income event surprises you or you plan to retire. Most economists & financial planners recommend that individuals have 6 – 12 months’ worth of living expenses available in liquid funds, in my experience this advice is rarely followed by Barrie home owners. As an alternative, I’m suggesting that home owners who are gainfully employed secure a Home Equity Line of Credit (HELOC), in addition to their current mortgage or as a 1st mortgage (if the home is owned out-right). While there are costs tied to arranging a HELOC, an appraisal (approx. $350) & legal closing costs (approx. $850), its well worth the investment if an unfortunate situation presents itself. Having a line of credit will prevent the home owner from having to overload high-interest credit cards, putting them in dire situation that is very difficult to escape from. Or a retiree having to forfeit their home to a reverse mortgage that charges sky-high interest rates.

One of the best features about a HELOC is if you don’t need it, you don’t pay for its use. This type of mortgage can lay dormant month-after-month, year-after-year, available when you need it. So don’t wait until it’s too late, book an appointment with your local mortgage broker and find out what it will take to secure a HELOC and your future.

Darren Robinson is a professional mortgage broker in Barrie, dedicated to offering the best mortgage strategies and provides personal assistance to help people qualify for difficult mortgages and loans. Call 705.737.6161

× Close this modal popup