Top 5 Things You Should Know – By Jennifer Brophy, Licensed Mortgage Professional

Mortgage Specialist in Whistler, Jennifer Brophy is featured this month and she was kind enough to share some incredibly useful information about securing a mortgage and the “Top 5 Things You Should Know.” Hiring a professional is something I highly recommend (I have a great list on my blog here) there is usually a reason why they are the expert in their field and Jennifer is no exception.  If you’re a homeowner or prospective buyer, Jennifer Brophy is the trusted source in Squamish, Whistler, and Pemberton. She has well-established relationships with her lender partners and she works with clients to understands their needs and wants, and ultimately tailor a financial roadmap to truly help you reach your objective – buying or selling your home!

Your Credit Score

Lenders use your credit score to gauge your ability to repay your debts. Ideally, your credit score is at least 660, but the higher the better. Your credit report includes any late payments, the number of accounts you have open, your overall debt levels, and the length of your credit history. Making loan and bill repayments on time and using around 30% of your available credit will help increase your score.

How to Maximize Your Purchasing Power 

Avoid financing any large purchases before securing a mortgage. An $800/ month car payment will reduce your maximum purchase price by about $175K. If you have existing student loans, credit card payments, or a car loan, consolidating debt will help you increase your purchasing power.

How Lenders Consider Your Income

While you’re in the process of securing a mortgage, you should wait to switch jobs, accept a contract position, or become self-employed. This could jeopardize your mortgage approval. Even if you accept a new position with a higher salary, you will need to pass your probation period, so it’s best to delay the start of your new job, self-employment, or contract status until after your mortgage funding date.

If you are self-employed you will need a two-year history to qualify for a mortgage with one of the big banks; which will provide you with access to the best rates and terms. There are other programs available for self-employed mortgage applicants which allow you to top up the net income or use a gross income.

Prepayment Penalties and Privileges

You should understand prepayment penalties, privileges, and terms. All lenders are not created equal. If you need to break your mortgage early or want to aggressively pay down your mortgage, understanding prepayment privileges is a must. By choosing the lender with the best terms for you, you can pay down your mortgage at the pace you want without incurring a penalty for making too many extra payments.

You Have Options

Even if your credit score isn’t ideal, you don’t have a two-year history as an entrepreneur, or you have a higher debt ratio, you still have options. Alternative lenders work with borrowers who do not fit the bank’s criteria and can help you get into the market sooner. Keep in mind that alternative lenders generally come with slightly higher interest rates and fees.

Questions? Call Jennifer with your mortgage needs today.

JENNIFER BROPHY, BCOMM
Mortgage Specialist servicing Squamish, Whistler and Pemberton
Contact via Email or phone: 604-905-9790
jenniferbrophy.ca