The information in the table above is just a factious representation of the choices you may have available once you fill out the form a the top on the page. The actual rates may differ. The Monthly Payments represented above are calculated assuming a property value of $400,000 and a downpayment of 15%.
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Have you ever struggled with finding the right mortgage rate for you? A lot of people here may be asking; how do I get the best mortgage rates in London for me? A lot of time and energy can go into the process, but it doesn’t have to be so hard. Loans Geeks’ mission is to simplify the entire process, giving borrowers everywhere access to all of London’s best and most reputable mortgage brokers in one spot. Here at Loans Geeks, there are teams of researchers that do the work for you; conducting research, comparing results, and negotiating deals, they do everything it takes to find the top mortgage brokers they can find in London, with the lowest mortgage interest rates in your location so that you the borrower can reap the benefits. Loans Geeks is essentially a one stop shop to all of the lowest mortgage rates in London, saving you money and time.
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Mortgage Calculator for London
When borrowing large sums of money, in this case getting a mortgage, it is important to budget your expenses and develop a plan or strategy with regards to how you will pay this mortgage off. Even with the cheapest mortgage rates found in London, a borrower should plan exactly how much it is you’d like to borrow, the timeline for which you intend to pay the mortgage off, and the interest rates that apply. With this knowledge you can calculate the exact monthly payments of your loan/mortgage and see how many of these dollars are calculated interest, and it’s easier than you think!
If you’re reading this now, you have access to the internet and therefore you can take advantage of this tool commonly referred to as a mortgage calculator. The mortgage calculator allows users to enter the aforementioned details such as total sum borrowed and interest rate and it computes a total amount in dollars, showing how much you as a borrower should be paying each month. While you can add essentially anything to your mortgage, if you have the extra room for it, it would be wise to calculate your expenses beforehand and use the mortgage calculator to grasp a better understanding of the effects. While mortgages are generally the cheapest form of debt, it is important to remember that this debt is only being postponed and that even the best mortgage rates in London will increase the length of which you’ll be making payments. As well, the amortization of your mortgage will also increase exponentially as the length of said mortgage continues. With this said, it is extremely important to budget your expenses, and mortgage calculators are there to help.
Mortgage Brokers in London vs. The Banks
As a borrower, you have a few options when looking for a loan. What most people wonder when first given these options is which one they should choose. Should you go to the bank or one of London’s mortgage brokers to find the right mortgage rate for you? Well, there are pros and cons to each, but generally speaking it is best to use a mortgage broker if you are looking for the lowest mortgage rates in London. The reason for this being is that a mortgage broker will negotiate for the lowest rates amongst a variety of lenders in an attempt to get you the best terms and lowest rates. One of the best parts of this is that mortgage brokers will offer you these services for free. If you are looking for lower interest rates because of low household income or bad credit, then the banks of London, or other locations, may not always approve a mortgage for you. This is to help manage risk on their end. In cases such as these, mortgage brokers are extremely helpful as they will help those despite their less-than-perfect finance situation. If you struggle with low house-hold income or blemishes on your line of credit, there is a mortgage broker in London that will not only work to help you, but will still attempt to negotiate the best mortgage rates across London for you. With this said, they still earn commission from the lending institution so if possible, it is wise to do some research on your own to ensure you are receiving the best possible financing for you.
Banks are a still viable option for your mortgage needs. Many first home buyers don’t trust mortgage brokers and having already developed a relationship with their bank, they would prefer to apply for a mortgage with said bank. Again, the bank may not always agree to finance your decisions should you have financial issues, past or present, but this may also indicate that one is not financially ready for a commitment of this stature. Keep in mind that mortgage rates offered by the banks of London may not be as low as from a broker, as they do not search for the lowest rates, they simply lend at the risk of their clients.
All in all mortgage brokers are in most circumstances beneficial when looking for the lowest local mortgage rates in London, something that should be considered when searching for financing.
Private Mortgage Lender in London
Two methods of applying for a mortgage have now been established. However, what can you do if neither the banks, nor mortgage brokers offer their services to you? The answer… there are private mortgage lenders all across London that offer short term loans to those that aren’t applicable through the more conventional methods, banks and mortgage brokers, for whatever reason that may be.
Private mortgage lenders are high risk mortgage lenders, some of which are located in London, and are sought out for numerous reasons, and is typically used as a last resort. One reason being that the borrower is in need of financing as soon as possible, and doesn’t have time to go through the longer application process that banks or even brokers require. Second, the borrower may have a credit history so bad that no lender is willing to finance them, and lastly, the property to be purchased is one that is deemed harder to sell, such as a log cabin in a very rural area.
You may be asking, what exactly are private mortgages? A private mortgage is a short-term, interest only loan, and will have some of the highest mortgage interest rates in London. These loans require no down payment, but rather interest payments each month. The reason for this being that these mortgage lenders understand that you, the borrower, are in a situation, most likely related to bad credit history, that omits you from any other form of financing. As such, they charge higher rates and will only last 1-3 years as a general rule of thumb.
Fixed vs. Variable Mortgage Interest Rates in London
When applying for mortgages in London, there are two different types of mortgage rates to consider and compare. The first of these two is a fixed rate mortgage. The fixed rate is and has been the more popular of the two, but not because it acts as a cheaper alternative to a variable rate mortgage. Fixed rates are more popular due to the fact that they provide a sense of regularity and stability. Borrowers set a duration for the mortgage term and the interest rate and payments are fixed. This makes it much easier to budget your expenses and offers that protection against any uncertainty.
Variable rates are less popular, but historical trends prove that variable rate mortgages are in fact less expensive over time. As opposed to the fixed rate mortgage, variable rates fluctuate according to the market interest rate, also known as the prime rate, and as such are less stable. This financial uncertainty is what deters many people from selecting even the best variable mortgage rates in London, despite its proven history.
When deciding which mortgage rate to select it is important to determine whether or not the prime/market interest rate is expected to fall or not. If the interest rate is low, it may be smart to select a fixed mortgage rate. In this situation your interest rate would be low and void of an increase that could cause a financial liability. If the prime rate is expected to decrease in the coming years, a variable rate should be considered. The decrease in the prime rate would decrease your interest rates and save you money.
A prime rate is essentially the interest rate that commercial banks and other financial institutions use to set interest rates for variable loans, such as the variable rate mortgages, and lines of credit. The current prime and mortgage rate in London is based on how much it costs financial institutions to borrow money, fluctuating as a result of changes in the economy. The current prime rate in Canada is 3.45% after increasing in recent years. While the prime rate has continued to increase since 2015, it is still relatively low when we look at the history of Canada’s prime rate. It is important to analyze historical trends such as these to help your search for the best mortgage rates in London, especially if you are looking for the best variable mortgage rate.
London’s Mortgage Rates Forecast
Due to the inflation Canada is experiencing, one can only forecast average mortgage rates in London to follow suit with the prime rate and continue to increase. Unemployment levels are low, consumer spending is high, and the stock market is reaching new levels. What this means for mortgage rates in London is that they will also increase in an attempt to provide some balance in the economy and attain an economic equilibrium.
The Bank of Canada government is suggesting we expect an increase of 0.25% in even the best mortgage rates over the coming months. The sharp increase in minimum wage is no help and interest rates are expected to increase into 2019.
Whether you use this information to apply for a fixed rate or variable rate is up to you. An increase in the near future does not necessarily mean that variable rates are out of the question. Rates are not expected to increase forever, there will be a point in which they decrease again and history shows that in time, more often than not, they will outperform even the best 5 year fixed rate mortgages. Remember to consider the prepayment penalties on fixed mortgages and examine all the costs associated.
London’s Housing Market
The Ontario’s housing market has seen strong gains over the past several years, with prices skyrocketing upwards of 23% in a single year. There has been a tight supply of housing in London and relatively low mortgage rates which make real estate extremely hard to come by. With so many buyers and so few homes, the housing market has grown significantly. This increase in prices has driven economic growth considerably but is expected to slow down in 2018.
Experts believe that the housing market may continue to increase, but at a much slower rate than what Ontario has seen in recent years. The housing market as a whole is expected to moderate to very slight growth, slowing the market completely.
A recent news release brought light to a highs-speed train to be linking southern Ontario cities with London included. This project is sure to increase overall prices in the London housing market substantially in the coming years with anticipation building. It might be wise to start looking into houses now and gain as much value on your home as possible.
There are many lucrative mortgages offers in the London market for first time home buyers. When you apply for a mortgage loan through Loans Geeks, we will match you with some of the best mortgage offers available for your particular situation.
If you apply for a mortgage loan in London via Loans Geeks, typically it will take 2-3 business days to get the reply about the status of your application, although this time might slightly vary from one mortgage loan lender to another.
Some mortgages in London are ported, and the remaining term can be taken to the new property. But, you will be required to get your credit score, and affordability rechecked in case the new house is worth significantly more or less than the one you currently have a mortgage for.
Most mortgage lenders in London allow their borrowers to pay anywhere from 10% to 20% of the original principal amount in each calendar year without inviting penalty. Since different lenders have different ways of implementing the prepayment terms, it is best to read the fine prints even before you secure the mortgage.
If you have poor credit history, it might be difficult to get mortgage application approval. However, as Loans Geeks partners with hundreds of different financial institutions, submit an application and we will try to match you with a loan provider willing to give you a mortgage loan. Still, bear in mind that the terms and interest rates of the offered mortgage loan will depend on your credit score.
A Non-Resident in Canada can get a mortgage and is qualified for the maximum loan to value ratio which is about 65-75%. You will need to provide a few extra documents such as a credit report from the origin country, income proof, and the down payment.