Good Finance has long been considered one of the leading banks in Canada and is often one of the first choices for homebuyers looking for a mortgage. But how is the experience of getting a mortgage from this creditor? What are the unique features of a GFI Good Finance mortgage and is it the right choice for you?
Let’s take a look at the details of obtaining a GFI Good Finance mortgage.
The down payment
When you buy a house, you must make a deposit and get a mortgage for the rest of the amount. With GFI Good Finance, as with all creditors, the minimum legal deposit is 5%, but this number varies depending on the purchase price of your home.
These rules are set out by the federal government and go like this: if the purchase price of your home is less than $ 500,000, the minimum deposit is 5%. If the purchase price of your home is between $ 500,000 and $ 999,999.99, your minimum deposit is 5% on the first $ 500,000 and 10% on the remaining amount. And if the purchase price of your home is $ 1 million or more, you must deposit at least 20% of the purchase price.
These rules are the same regardless of the creditor you choose, and are set so that you can not buy more homes than you can afford. If you need help figuring out exactly how much you need to deposit.
Mortgage Loan Insurance
Sometimes also called GFIC insurance, mortgage loan insurance is required by law to protect the creditor in the event of default on your mortgage.
The cost of insurance is calculated as a percentage of the purchase price of your home. The higher the deposit, the lower the percentage and the less you pay in the premiums. Here are the exact percentages you will pay depending on the size of the down payment of your home:
- If your deposit is between 5% and 9.99%, your premium is 4% of the purchase price.
- If your deposit is between 10% and 14.99%, your premium is 3.1% of the purchase price.
- If your deposit is between 15% and 19.99%, your premium is 2.8% of the purchase price.
- If your deposit is 20% or more, you do not pay a premium.
As you can see, the higher your deposit, the less mortgage insurance you will pay. These bonuses are the same, regardless of which bank you choose.
Your mortgage loan insurance is added to your mortgage and you will pay it during the loan term. If you plan to deposit a larger deposit to reduce your premium rates (and therefore your monthly mortgage payment), you can use mortgage payment calculator to see exactly how different premiums and deposits will affect your normal mortgage payment.
The amortization period of your mortgage is the life of the mortgage. If your deposit is less than 20% of the purchase price of the house, the maximum amortization is 25 years.
The term of your mortgage is the length of time you agree to pay a specific mortgage interest rate to GFI Good Finance. If you are convinced of your financial situation and you think mortgage interest rates are likely to increase in the future, a longer mortgage term may be right for you. On the other hand, if you need more flexibility in your mortgage period (breaking your term may result in penalties), as you can move to work or for any other reason, a shorter mortgage term is a good option for you.
Frequency of payment
When you apply for a mortgage with GFI Good Finance, there will be many decisions to make. You will have to choose the amortization period, how long do you want your mortgage contract to last and whether you want a fixed or variable interest rate. Another choice you will need to make is the payment frequency that suits you. The frequency of payment of your mortgage is the frequency with which you pay your mortgage. You can choose every month, twice a year, twice a week, every week, speed up every two weeks or speed up each week. An accelerated payment schedule allows you to pay off your mortgage earlier, but also results in higher payments.
As a mortgage holder with GFI Good Finance, you have two options if you want to pay off your mortgage ahead of schedule. The first option will be to add up to 10% of the current mortgage payment amount of a GFI Fixed Smart Mortgage or up to 20% of your mortgage payment for any other type of closed mortgage. Increasing your monthly payment may be a good option if you have received an increase at work and you have room in your budget.
The second option is to make an annual lump sum payment (minimum $ 100). If you have a GFI Fixed Smart Mortgage, you can get up to 10% of the original mortgage amount. For any other type of closed mortgage, you can pay up to 20% of the original amount of the mortgage. This type of prepayment is a good option if you are receiving an inheritance or any other fortune.
Your mortgage rate is the interest rate you will pay on your mortgage. Fixed rate mortgages do not change for the entire term mortgage. But floating rate mortgages are tied to the prime rate of the bank and can fluctuate throughout the quarter.
GFI Good Finance offers mortgage interest rates that are competitive with the rest of the market. As of June 20, the 5-year GFI fixed mortgage rate is 2.59%. The best mortgage rate for a five-year fixed rate mortgage is 2.24%. If you are sure you want a mortgage from GFI Good Finance and want the lowest possible mortgage interest rate, you should try to negotiate (either alone or through a mortgage broker) to get a better interest rate than the posted rate. Trading is a common practice and it’s a great way to save you thousands of dollars in mortgage interest.