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Mortgage Term
Choose Your Mortgage Type And Payment Period
While the amortization period is the total time it will take you to pay off your mortgage, a mortgage term is a short-term contract that outlines what rate you will pay off your mortgage — and for how long you’ll pay that rate. You’ll likely have several mortgage terms over the course of paying off your mortgage, making it, arguably, the most important element of your mortgage. After all, the terms you negotiate in the contract will outline how affordable your mortgage payments will be over the coming months and years. If you want to discuss mortgage terms and determine which length is best for you, contact me anytime. If you want to find out more about how mortgage terms work, read more below.
How Long Should My Mortgage Term Be?
Option 1: A Short (Sub 5-Year) Mortgage Term
Short mortgage terms can range anywhere from a few months to a few years, and generally indicate that you want to stay mobile in a changing market. While there can be savings if rates go down, it also means that you’re susceptible to the prime rate going up — and your payments going up with it.
Option 2: A Standard (5-Year) Mortgage Term
As the standard choice, a 5-year mortgage term is generally considered a “sweet spot”. While you get to lock in a current rate and help make your mortgage budgeting simple, you will still have the chance to renew at a new rate and with new terms within a short(ish) period. These conditions can change, however, if you decide to renew early or sell your home.
Option 3: A Long (10-Year) Mortgage Term
If you’re planning on staying in your home for the long haul, a 10-year mortgage term offers maximum stability. Your payment won’t change, and your rate will be protected against any swings in the market. However, you’ll also potentially miss out on the rate going down, and you will still incur penalties if you try to renew early.
Why Choose A Mortgage Agent Vs A Big Bank?
Big banks are great for personal finances, but mortgage agents do one thing and one thing only: work hard to get you the best mortgage rate. Canadian mortgage brokers have access to a wide selection of mortgage lenders, which means that, in many cases, mortgage broker rates are lower than bank mortgage rates. It doesn’t stop at low rates, though. There are many more reasons why a mortgage agent is the best choice for your mortgage — find out what else sets us apart.
Contact Me
The Best Mortgage Rates Are Here
Do you have questions about your mortgage eligibility? Or, maybe you’re ready to apply for a mortgage or get a mortgage quote? Contact me anytime via call, text, or contact form. Find out why so many people trust mortgage agents to handle their home loans.