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Different types of New Brunswick mortgages or mortgages New Brunswick
(New Brunswick, Canada)

Conventional New Brunswick mortgage or New Brunswick mortgage conventional

An New Brunswick mortgage that does not require a mortgage default insurance fee. Typically this is a mortgage New Brunswick loan which is 75% or less of the purchase price or property value. The good? By having a large down payment, you can save thousands of dollars in insurance fees. The bad? When you sell there will be less buyers eligible to ‘assume‘ your New Brunswick mortgage because they may not have enough of a downpayment.

Non-conventional 1st New Brunswick mortgage or ‘first’ New Brunswick mortgage non-conventional

An New Brunswick mortgage that is used when you need New Brunswick lender financing which is greater than 75% of your house purchase or property value. This can also be called a ‘high ratio’ New Brunswick mortgage when it is a refinanced ‘first’ New Brunswick mortgage. The good? It allows people who don’t have large down payments the ability to buy a house. They do this by using mortgage default insurance. (See CMHC or GE Capital below). Another good? It allows you to refinance your house beyond its 75% appraised value so you can access your equity and get cash out! This allows people that are loaded up in other high interest debt (credit cards) or high loan repayments (car loans) the ability to payout these debts and conserve family cashflow. The bad? The benefit of ‘insuring’ an New Brunswick mortgage default costs a lot in premium costs - but, thankfully, this can be added to the ‘first’ mortgage New Brunswick loan. The cost is minimized if the real estate market is rising or stable as it allows people to buy real estate today - rather than waiting years to save up more of a down payment.

New Brunswick mortgage Second or Second New Brunswick mortgage (New Brunswick home equity loan)

An New Brunswick mortgage second or second New Brunswick mortgage (also called a New Brunswick home equity loan) is usually a non conventional mortgage New Brunswick loan. Often it is used when New Brunswick mortgage financing exceeds 75%. This is usually made available through private New Brunswick lenders rather than institutional New Brunswick lenders. A private New Brunswick second mortgage or New Brunswick mortgage second is used with your mortgage New Brunswick first priority. Your personal New Brunswick mortgage broker will advise you when this makes sense. The good? Sometimes, your current down payment amount available PLUS a new New Brunswick second mortgage allows you ’enough’ of a down payment to qualify for a non conventional purchase. You can then avoid paying mortgage default insurance altogether. And that can save you thousands in default mortgage insurance premium dollars. Also, an New Brunswick mortgage second or second New Brunswick mortgage (New Brunswick home equity loan) will allow you to access your cash in your home equity. This allows you to improve your monthly cash flow by paying off other higher interest debt (credit cards) AND other debt that has high monthly payments (car loan). Also there is no default insurance payable when you obtain a private New Brunswick mortgage second or New Brunswick home equity loan as the lenders are private and do not charge an insurance fee. The bad? Second mortgages always have a higher interest rate cost than a first mortgage because there is a higher perceived risk by the lender with the borrower.

CMHC or GE Capital

Mortgage Insurance companies licensed by the Federal Canadian Government to provide mortgage insurance for New Brunswick lenders. This insurance protects New Brunswick lenders against default by borrowers. The insurance is usually added to the mortgage New Brunswick loan. The good? This insurance enables many more buyers to enter the market which keeps housing demand strong. It allows people to be able to buy with a low down payment. The bad? Premium rates range from 0.5% to 3.75% or more of the mortgage New Brunswick loan balance.

‘Open’ New Brunswick mortgage or a ‘Closed’ New Brunswick mortgage

An open New Brunswick mortgage has terms from 6 months to 1 year This is an New Brunswick mortgage in which you can prepay all, or part of the original balance without penalty. The good? You can save usually 3 months interest charge penalty or more for the entire New Brunswick mortgage balance. This is helpful if you plan to pay down your mortgage New Brunswick loan with a large sum, or the entire balance of your New Brunswick mortgage in a short period. The bad? New Brunswick lenders charge higher rates than for closed terms because of this convenience. Here is a helpful tip from your personal New Brunswick mortgage broker. If rates are going up…and you are moving…get a closed term New Brunswick mortgage. You can ‘port’ your current New Brunswick mortgage to your new place.

A closed New Brunswick mortgage has terms from 6 months to 10yrs. The good? The rates are lower than ‘open’ mortgage New Brunswick loans. The bad? You need to be careful to pick a term that suits your needs. Your personal New Brunswick mortgage broker can explain to you the risks of not choosing a term that suits your needs. You may be faced with a large penalty if you try to prepay too much or try to switch your New Brunswick mortgage to another New Brunswick lender in the middle of your term.

ARM New Brunswick mortgage or Variable New Brunswick mortgage

The ARM (Adjustable Rate Mortgage) or Variable rate New Brunswick mortgage is all about the ‘rate’ charged with your mortgage New Brunswick loan. Instead of a ‘fixed’ rate the rates fluctuate. These variable New Brunswick mortgages can be either open or closed. Terms are from 6 months to 5yrs. Rates fluctuate with prime, usually monthly but can be every few months. Variable mortgage New Brunswick loans have been historically extremely popular. The good? New Brunswick mortgage rates are as much as 2 or 3% below the 5 year fixed rates. This can save you up to $200 or more interest per month on a $100,000 New Brunswick mortgage. The bad? You will pay a penalty if you want to pay it off early or switch lenders. Or you may find yourself chasing headlines when prime rates rise. Ask your personal New Brunswick mortgage broker for advice on obtaining the best variable mortgage New Brunswick loan. The good? Most New Brunswick lenders will let you convert to a fixed rate, closed term, without penalty. If you are lucky you can save tens of thousands off the principal and interest. This will take years off your amortization on your New Brunswick variable mortgage.

Portable

First a disclaimer. No New Brunswick mortgage or mortgage New Brunswick loan is portable. It is the rate and term that are portable. If you move to a new place and want to take your New Brunswick mortgage with you, you will need a new New Brunswick mortgage with the same rate, term, and amortization that was left on your old place. The good? The benefit of a portable mortgage is that you may keep your low rate and not have to pay CMHC or GE Capital fees again. The bad? You will have to re-apply - even if you are staying with your present New Brunswick lender. And, you will still owe a ‘pound of flesh’ as you will have to pay legal fees.

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