Who is this for?
A mortgage is for anyone who wants to buy a home but doesn’t have the cash available to make the purchase outright. For most Canadians, buying a home and getting a mortgage go hand in hand.
However, the mortgage product you acquire will depend on your unique financial situation and your goals for the future. For example, a young person buying their first home in a major housing market – like Toronto, Montreal or Vancouver – may be interested in a different mortgage product than a retiree looking to purchase a cottage on a quiet lake.
How will this help me?
Put simply, a mortgage can make it easier for someone without a substantial amount of liquid (or readily available) savings to acquire a home. A mortgage is a long-term loan that, by spreading your payments over a period of time, can make it easier to make home ownership a part of your financial security plan.
A mortgage can also allow you to use your home as collateral in what is known as a home equity loan. The funds that are made available through this kind of loan can be used for virtually any kind of expense, from making repairs to your home to paying for post-secondary education or medical procedures not covered by government healthcare plans.
Finally, acquiring a mortgage and making your payments on time can help to improve your credit rating, potentially making it easier to acquire other types of loans in the future.
What else do I need to know?
Generally speaking, fixed-rate mortgages have the same interest rate for the entire term of the mortgage. It may be the best choice if you think interest rates will increase over time, or if you like the idea of having predictable payments.
Variable rate mortgage
London Life’s variable rate mortgages may offer customers the ability to reduce their mortgage balance faster, thereby lowering their overall interest costs. That’s because a variable rate mortgage allows you to take advantage of interest rate changes.
Of course, a variable rate mortgage has its drawbacks – if interest rates rise, you may find yourself paying higher mortgage payments than you originally anticipated. In other words, if you’re not comfortable with the possibility of having your mortgage payments increase over time, this may not be the type of mortgage for you.
Lock and Roll Mortgage
If you’re concerned about having to renegotiate your mortgage every time its term is up, our Lock and Roll Mortgage may be for you. That’s because the Lock and Roll Mortgage can be set to automatically adjust to prevailing closed mortgage rates every six months over a five-year term. This means the Lock and Roll Mortgage may be ideal for people who want to “set and forget” their mortgage and aren’t afraid of fluctuating interest rates.
Adjustable Rate-Adjustable Payment Mortgage
London Life’s Adjustable Rate-Adjustable Payment Mortgage may be the best choice for people who want to make the lowest available mortgage payment every month. Both the interest rate and mortgage payment are updated at the beginning of every month based on our mortgage prime rate and the remaining amortization period of your mortgage.
In the end, this could lower your mortgage payments, freeing up funds for other purchases or completing home renovation projects.
Connect with an advisor
Working with a financial security advisor can provide you with the tools and expertise you need to plan for the future.