It refers to the duration of the mortgage agreement you sign. The term can range from 1 to 10 years. It’s important to ask yourself why you want a five-year term instead of two or three years, and not just the interest rate, but your projects as well. see bluedaffodil.net for further notes
This is the total duration of the mortgage. Amortization can range from 10 to 35 years. Once again, each case is unique. It must go with its ability to pay and its medium and long-term goals. Do the math with our calculator and you’ll find that one year less to your mortgage can save you money.
The calculation of the penalty
This situation occurs during a pre-term repayment for fixed term loans. For example, you receive an inheritance and decide to pay the house, or you divorce and want to sell the house; a penalty will apply because there will be a breach of contract. Also, if the lender had paid the notary, he can unfortunately resume his gift, if there is a breach of contract. Note that the minimum penalty is always three months.
Want to pay your mortgage faster? Good idea, but is it possible to do it? And how high exactly? Several contracts make it possible to increase payments en route or to pay lump sums. Check the percentage of the amount that is allowed by the lender.
Transfer to another financial institution
Subrogation (transferring the balance of the mortgage and the amortization to another institution) is possible to renew a mortgage loan. However, this is not always free of charge.
The possibility of increasing the loan without returning to the notary
Upon renewal, some lenders offer to re-borrow the repaid principal up to that time.
This refers to the transfer of the mortgage loan to another house. It may be beneficial to do so if the rates are going up because you could keep your initial rate.
The possibility of having the mortgage assumed by someone else
When you sell the house, it is sometimes possible to transfer your mortgage to the buyer under the same conditions. But beware, you remain responsible for the loan! This is an option if you sell the house to a close, including.
Line of credit
Your property and a good credit record may entitle you to a home equity line of credit under certain terms. Check right away if this option is possible with your loan, even if the line of credit is not a product that interests you. This will save you the notary fees, if any.
The option with discount
This option is not offered by all lenders. Depending on your strategy, it may be worthwhile to have a higher rate for a certain period to receive a discount of up to 5% of the amount borrowed.
All institutions offer monthly and bi-weekly payment. But beware of fast-paced offers “every two weeks” that are not really! Occasionally, some lenders simply divide the annual amount you would normally pay in 26 2-week periods. You will understand that the amount paid remains the same and is not an accelerated payment that would have made you repay your loan faster.