Fixed-rate mortgages offer homeowners the security that comes with knowing your mortgage rate and payment will remain unchanged. There is no need to worry about interest rate changes during the term of the mortgage - simply “set it and forget it.” Variable-rate mortgages are often discussed by brokers due to their flexibility and the ability to help mitigate penalties. With a variable-rate mortgage, you can benefit from lower rates if your lender’s prime lending rate decreases, making it a great option for those comfortable with taking on more risk or uncertain about how long they plan to hold the property. However, it’s important to align the term of the mortgage with your future plans, and locking into a fixed interest rate can provide peace of mind and reduce the stress of market fluctuations. Ultimately, the best mortgage option depends on your unique needs and preferences.

You should also think about the cost to get out of your mortgage early if you want to sell or refinance. Your life circumstances can change and you may need to break your mortgage i.e. job transfer, illness, or divorce. The penalty to break a variable mortgage is less expensive than a fixed-rate mortgage, but that doesn’t mean you shouldn’t take a fixed rate, it just means that you should be aware of the potential fees and penalties that come with your mortgage and consider what your future may hold. If you think you may move before the term of your mortgage is up, you should look at having the ability to port your mortgage to the new property. This is a way to avoid paying the penalty to break your mortgage, but not all lenders allow for it. Some ports have quirks and nuances that may make it challenging to navigate when trying to buy a new home.

You can make your payments monthly, bi-weekly, or weekly. If you want to pay off your mortgage faster and save thousands in interest, consider an accelerated payment option – accelerated weekly and accelerated bi-weekly. This type of payment has you making roughly one extra payment a year and is a good option without putting too much pressure on your budget. In addition to accelerated payments, another way to become mortgage free sooner is to use the prepayment options available to you i.e. how much of a lump sum payment can you make and increase your payments by each year. This will be outlined in your mortgage contract but it is an important mortgage feature and may affect which mortgage you select.

Some buyers prefer to add the costs of initial renovations into their mortgage, instead of racking up credit card bills or selling investments to pay for those renovations known as a “purchase plus improvements” mortgage, this type of mortgage covers the sale price of the home plus any renovations that would increase the value of the property, up to a certain dollar amount.

When adding improvements to your mortgage you will need to gather your quotes within your “condition removal deadline” and your down payment will be based on the total improved value. Funds are held back at the law office until the job is 100% completed and normally a appraisal is required which is an additional cost to the borrower.

By putting 20% or more down on your mortgage, you can access the flexible 30-year amortization to make your payments smaller and free up cash flow. Whether investing in a business venture, funding higher education expenses or preparing for maternity leave costs - whatever life throws at you - this option can give you room to breathe or help you build wealth.