Frequently Asked Questions

Yes! Mortgages can be obtained for a variety of purposes including home purchases, home renovations, or refinancing to pay off other high interest rate debt.

Depending on the circumstances surrounding your bankruptcy, generally First Capital Corp. would consider providing mortgage financing upon owning a real estate property.

A Co-signer is placed on the mortgage and is registered on the title. A Guarantor signs a document that personally guarantees the mortgage. Most banks will do both. Some banks prefer that co-signer live on the property.

No. The lender is not under any obligation to renew your mortgage. It does not ‘automatically’ renew. In fact if you have ‘missed’ or been late with any payments the lender could use this as an excuse not to renew with you. A loss of a job or a divorce may be another reason. But, in truth, no excuse is necessary for the lender to call your loan. This cannot be understated. For example, it is common for businesses to find their commercial mortgages NOT renewed for any reasonable reason at the end of term. And this may be no fault of the business that paid their mortgage payments on time. A bank could refuse to renew because they don’t like the economic climate of a particular geographic area or even a type of industry a business operates in. Think about the hardships suffered. For this reason alone it is critical for businesses and homeowners to obtain a quote from a mortgage consultant 60 to 90 days before their current mortgage matures. This way if your current lender does not offer you a renewal you have a backup lender in the wings. If you use a mortgage consultant you will often benefit with a lower rate anyway.

When interest rates are low you should take as long of a term as you can afford. When the interest rates are high you should take the shortest term and renew every 6 months or 1-year. Whenever the interest rate spread between short term and long-term mortgage rates are significant it is always better to take the shortest term possible. The difference in savings could be invested elsewhere i.e. paying down your mortgage principal, investing in segregated funds or for topping up your RSP contributions. Currently, with such low rates most people are locking in for terms of 5 or even 10 years. SEE MORTGAGE CALCULATOR!

It simply means that for the term of your mortgage the interest rate charged is a fixed amount and does not change during the term of your mortgage. If you look at our rate comparisons you will see this distinction between fixed and variable rates.

Compared to a fixed rate mortgage a variable interest rate ‘floats’. Although the mortgage payment amount may stay the same the actual interest charged may change on a monthly basis. A drop in interest rates is great news for you and it will mean that more of your mortgage payment will go towards reducing your mortgage principle. If interest rates rise then less money will be used for reducing your principle and will instead be used for paying higher interest costs. If you think interest rates will fall over the next 3 to 5 years then purchasing a variable mortgage makes a lot of sense. With mortgages you pay a price for certainty. You generally pay more for a fixed rate mortgage because the lender is taking the risk as to what the rates will do by fixing the rate for you. You generally pay less for a variable rate mortgage because it is you that is taking the risk of uncertainty as to how interest rates will move – up or down. With low interest rates variable interest rate mortgages have become popular. Often it is possible to get a rate just over or under the bank prime rate!

An open mortgage gives you the most flexibility in making extra payments towards your mortgage principal and even lets you pay off your mortgage entirely whenever you wish to. If you have uncertainty in your life such as a serious illness, a looming separation or a possible job transfer to another city it is better to have an open mortgage. This way if you ‘have to move’ you can pay off your mortgage without any penalty. This could save you thousands in prepayment penalties. Warning! Not all-open mortgages are created equal. Check with a mortgage consultant to see just how ‘open’ your mortgage is!

Compared to open a closed mortgage offers little to no privileges in paying off your mortgage early. You cannot pay off your mortgage without attracting penalties, called prepayment penalties, from the lender. Warning! Not all closed mortgages are created equal check with your mortgage consultant as to how your prepayment penalties are calculated. The difference between one lender definitions of penalty to another lender is enormous. Only people with very predictable lives should pick closed mortgages with long terms. And really, whose life is that predictable these days? Avoid long term-closed mortgages.

It is not really the frequency that makes a real difference but how much you pay. An actuary could do the math and say that by paying weekly you are ‘slightly’ better off when comparing 12 monthly payments versus 52-week payments. There is a lot of advertising out there that promotes weekly but the difference is really not that significant. What is important is whether or not you are making an extra payment towards your principal with whatever frequency that you choose. Any extra payment towards your principal dramatically improves your amortization period. In fact a 10% increase in your payment amount may knock off almost 8 years in your mortgage. That is nearly 100 less monthly mortgage payments! Think of the vacations you could go on! Think payment amount not frequency of payment. SEE MORTGAGE CALCULATOR!

First Capital Corp. has years of financial experience in the market as well as a pool of diverse relationships established in the industry to give you the best possible experience, and the knowledge to get the job done with the best rate possible.

If you are applying for a preapproved mortgage, have the following information ready to give to First Capital Corp.

Have your employer give you a letter on company letterhead outlining your name, position, gross annual income, and number of years employed with the company. Also find you most recent pay stubs.

Social Insurance Number: At least 3 years history of residence and employers Know your banking information (i.e. institutions name, address, type of account.)

Know your assets and their value (i.e. cash amounts, stocks, bonds, RRSPs, vehicles, pension plans, home, and any other real properties.)

Photo IDs (Drivers License)