General Info Regarding The Mortgage Brokerage Business Within Canada
Within Canada it is the provincial government who establishes the laws which regulate mortgage brokerage. Mortgage brokerage businesses within nearly all provinces must carry a provincial license. There are three major insurance companies in the country which insure high ratio loans: Genworth Financial, Canada Guaranty and Canada Mortgage and Housing Corporation.
The Canadian Association of Accredited Mortgage Professionals or likewise called CAMMP for short is Canada’s national mortgage brokerage organization. Members of this organization are given titles as “Accredited Mortgage Professionals.” These people are committed to offering the highest level of service available and adhering to the highest ethical standards. They have extensive business understanding and are considered the finest within their field.
The national proficiency standard is the AMP, that is just available to mortgage professionals within Canada. It guarantees that the level of professionalism within Canada’s mortgage industry remains high and encourages ongoing education and ethical behavior.
Customers are really encouraged to seek out a mortgage professional with the AMP designation. Most mortgage brokers offer the services for free to the customer. Lenders normally pay them a “finder’s fee” after the application as been approved for taking the application, gathering the supporting documents, and getting approval. In rare conditions, a fee will be paid by the client, but it is always disclosed to the consumer before a commitment is made.
Fixed Rate Mortgage
Fixed rates mean that mortgage interest rates will not change over the terms of the contract. There are no surprises because you could always count on how much your payments will be and determine how much of your mortgage will be paid off when the term ends.
Variable Rate Mortgage
A variable rate mortgage is when you agree to a fluctuating interest rate for the duration of the term. As interest rates fluctuate with the bank’s prime lending rate and can change from each month to the next. You pay the same amount when interest rates change, however, the amount that is applied to the principal will change. If interest rates drop for example, more of your mortgage payment is applied to the principal balance due. This kind of mortgage is a better choice for homeowners who believe that the interest rates will drop eventually if they are presently high.
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