Understanding Mortgage Options

Tip #1 – Understand the financial implications of a mortgage for your sale – If you now have a mortgage on your home, it’s important to consult with your financial institution, to discuss your options and to understand the financial implications of selling your home. Questions you can ask include the following:

• Is my mortgage portable to a new home?
• If so, under what conditions and is there an associated cost?
• Will there be a mortgage penalty if I sell by this date? If yes, what type of penalty is it and what are the estimated costs today? How can I reduce my penalty?

Tip #2 – Get pre-approved for a mortgage before you buy – If you need a mortgage on a home that you are buying, it’s critical that you talk to a mortgage specialist before you go on your House Hunting Trip. Obtaining pre-approval of a mortgage will ensure that you know how much you can afford and help you focus on homes within that price range. Take the time to understand your options regarding the options for amortization period, the types of terms available to you and the choices of mortgage rates, such as fixed or variable interest rates. Questions to ask your mortgage professional can include the following:

• What are the pre-payment options?
• Can we insert a clause to waive a penalty upon early discharge, or limit the penalty to the equivalent of three months of interest?

Tip #3 – Understand your benefits clearly – The CAF Relocation Directive outlines which mortgage-related expenses can potentially be reimbursed, based on your move type and particular scenario, such as interest in a short-term loan and bridge financing. We invite you to carefully read the Relocation Directive to understand what expenses might not be covered, such as mortgage-breaking penalties and mortgage loan insurance.

As you consider what works best for your situation, remember that your CRSP Agent is not a mortgage specialist. This document offers general information on mortgage terms and conditions, and tips on how to proceed. For expert support, we recommend consulting a mortgage specialist.

We expect you have more questions. Your Knowledge Centre on Your Move Profile is an invaluable tool for other relocation information and guidance: other VIPs, fact sheets, and FAQs. Take the time to review all the information available.