This question depends on your financial situation and your goals.

Fixed-rate mortgages are generally seen as risk-averse and predictable, as customers lock in a rate for the duration of their term (usually five years), meaning payments stay the same. However, if the homeowner needs to break their mortgage (pay off the loan before the end of their term), they may be subject to higher prepayment penalties.

With a variable mortgage, the interest rate is subject to change throughout the term, depending on the Bank of Canada’s interest rate announcements. Therefore, the percentage of your payment that goes toward the interest and the principal will fluctuate. The penalty for breaking a variable mortgage is usually equal to three months’ interest on your loan. So, if your property is not your forever home or you plan to move in, say, three years when you have a five-year term, a variable mortgage could save you money or a 3 year fixed mortgage, But you have to consider that there is a certain amount of risk.

You may think that after you file for bankruptcy or a consumer proposal you may either never be able to qualify for a mortgage again, or you might have to wait for many years before you do. That is an incorrect assumption that many Canadians make, and you may be able to qualify for a mortgage or home refinance much sooner than you think. Lenders will treat a bankruptcy and consumer proposal the same. You will have to be discharged from your bankruptcy or pay off your consumer proposal.

You’ve made the offer on a house that’s just perfect for you. The seller has accepted it, and now you just can’t wait to get the keys. So why is it taking 30 days to close this loan?

• Documentation: One of the biggest things you can do to help your mortgage process along is to have your documentation ready up front.
• Special Situations: Some clients have specific situations such as past bankruptcies, foreclosures, previous judgments, old tax liens or divorces, etc. Having the documents related to these events on hand is important, as we may be requesting them through your loan process. If you have any collections or things showing up on your credit report that have already been taken care of, your lender may also request documentation on those as well.
• Appraisal standards: Pre-housing crisis, mortgage lenders had much more flexibility when it came to getting an appraisal completed. But appraisal standards changed significantly on a number of levels. Nowadays, appraisal management companies are required to follow stringent guidelines. This further delays an already time-consuming process.
• Title-related delays: Many homeowners don’t know everything that goes into obtaining a mortgage. Procedures such as making sure there’s a “clear title” to the property are important aspects of getting your loan closed. If there are any judgments or liens on the property, these need to be cleared up before you can close. Unfortunately, this isn’t always a quick fix.
• Stringent underwriting: Although underwriters have shown significant signs of loosening up in recent years, homeowners still go through a number of screening processes. The underwriting process can be intense. Underwriters will often request additional documentation based on the initial documentation presented. Even the most seasoned loan originators can’t always anticipate the items a stringent underwriter will require.