Getting Your Mortgage Right

by Adam on April 10, 2017

house questionIt is estimated that every day, each person makes roughly 35000 decisions. These can be as minor as what to have for breakfast or what TV channel to watch, or they can be really important, such as deciding to propose to the person that you love. Managing your personal finances is no different.

Every day represents a new set of decisions that you have to make about money. Again, they can be rather small like buying a chocolate bar at a supermarket checkout on an impulse, or major, such as deciding to take out a mortgage so that you can buy your own property. In that case, there are many more decisions that you have to make. What property you choose to purchase can depend on whether you intend to live in it, to rent out, or simply add it to your portfolio. If you are buying it for yourself, you have to calculate what money you have and then try to make it go as far as it can. Do you want three bedrooms as well as a downstairs toilet and a big garden? Perhaps your finances won’t stretch that far, and you need to consider something that has as many of these things as possible. But which combination would you be most satisfied with? In any case, every decision, however big or small, counts towards the health of your personal finances and you should weigh the consequences before rushing into anything. When it comes to getting a mortgage, there are so many different options (including add-ons and extras) that the decision of which one is right for you could quickly become overwhelming. If you are finding that you do not know where to look to get the best deal, here are a few tips to point you in the right direction:

houseFirst, you should carefully calculate just what sort of mortgage you will be able to get. Many banks will not offer you any deal if you do not have a sufficient deposit. The standard was once 25%, but many banks expect around 40% now to get the best rate. Either way, the bigger deposit that you are able to scrape together, the better deals that you will be offered. It makes good financial sense to put off the decision to get a mortgage for a few years if you have a small deposit at the moment. While it may be frustrating, it will save you money in the long run.

On the subject of saving money, there are lots of facets to a mortgage, and if you are going to get the best deal, you need to make sure that you check all of the small print. One lesser known feature of mortgages is the insurance you have to pay on behalf of the bank in case you are at some point not able to meet your payments. To figure out how much you are likely to pay, use a cmhc calculator. Being prepared will impress potential lenders and make it more likely that they will trust you with their money.

It is often said, but it remains the case that purchasing a house is likely the most substantial financial decision that you’ll ever make. While we make around 35000 of decisions every day, this one requires a great deal of time and attention to get right.


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