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Dominion LenDing Centres OUR HOUSE FALL 2017 >> 37 Location Where your home is located will have an overall effect on your mortgage rate. generally speaking, provinces with more competitive housing markets will have lower rates. Rate Hold Lenders may offer a rate hold—a guarantee to lend at a certain rate that lasts for 90 to 120 days. if your closing dates do not fall within this time frame, then your rate will be re-assessed. if your rate hold is re-assessed and the lender's rates at that time of re-assessment are higher than your initial rate, then your rates will go up accordingly. Dominion Lending Centres brokers always follow up with all of our clients on a regular basis to avoid this situation whenever possible. Refinancing Any changes to your mortgage will typically affect your rate when you are working with your existing lender. new buyers will have lower rates than refinances, but refinances will have lower rates than mortgage transfers. DLC mortgage brokers can access multiple lenders to find the most suitable product for their client's unique needs. Home Type Among other things, lenders assess the risk associated with your home type. some properties are viewed as higher risk than others. if the subject property is considered higher risk, the lender may require higher rates. Income Property/ Vacation Home if you are buying a property as an investment or a vacation home then the lender can assess at a higher risk and a higher rate may apply than would apply on a principal residence. this is one of the major benefits to having a DLC mortgage broker on your team. they have access to a variety of lenders that must compete for your business. Credit Score Your personal credit score is a large determining factor in your rate. Lenders want to see that you have a history of managing your debts well and that you will be able to pay them back over time. Insured or Uninsured the rule changes that the federal government made in october 2016 have had a significant impact on mortgage rates depending on whether your mortgage is insured or not. read our Change of Space guide (dominionlending.ca/newrules) to find out the full impact of these changes. Fixed/Variable Rate the type of rate you are wanting to get will also affect your rate. Fixed rates are based on the bond market—what fixed-income investors around the world demand to be paid for longer-term lending—whereas variable rates are based on the Bank of Canada's overnight lending rate, which is tied to the state of the economy here at home. Loan to Value (LTV) the higher the Loan-to-Value ratio, the higher the risk. You can have someone who has a $1 million mortgage but has $2 million in equity in the property and they would be viewed as a lower risk than someone who has a $200,000 mortgage and their property is only worth $220,000. However, right now we're seeing an unusual situation where higher-risk mortgages are obtaining lower rates. this situation is due to recent changes to the mortgage industry by the federal government. Income level the final part in this rather large equation is your income level. Although this does not necessarily affect the rate itself, it does have an impact your purchasing power and the amount you are able to put down on a home. 1 6 2 7 3 8 4 9 5 10 Each of these factors plays a role in the rate you will be able to get through a lender. The easiest way to get the lowest rate is to work with a dedicated DLC mortgage broker. They will put together a foolproof plan to get you the sharpest rate. They also have access to a variety of lenders which saves you the time and trouble of shopping for your mortgage on your own. As a final point, mortgage brokers can also assess your unique situation and find the right mortgage for you. Their goal is to see you successfully find and afford the home of your dreams and set you up for future success.