Home Equity Loans
Home Equity Experts in Ontario Northwood Mortgage Ltd. is one of Ontario's largest brokerage firms. If you need a...
Mortgage Solutions
Third Mortgage Ontario
In the realm of real estate and financing, a third mortgage is a type of loan secured against a property, ranking behind the first…
Mortgage Refinance Ontario
Refinancing is the process that pays the existing mortgage and/or any other legal claims against the property and sets up a...
Second Mortgage Ontario
Becoming a homeowner is a proud moment in any person’s life. But owning a home also has a number of financial...
Reverse Mortgages
A reverse mortgage lets you borrow money by using your house as collateral. This option gives you access to about 55% of the current...
Commercial Mortgages
You may need a commercial or industrial mortgage if you need a loan to help you purchase a piece of land or property...
Industrial Mortgages
Northwood Mortgage has over 50 years of combined experience in commercial, industrial and investment mortgages.
First Mortgage Ontario
When it comes to your first mortgage in Ontario, there are many expenses that arise other than your monthly mortgage payment. There are a number…
Pre-Approved Mortgage Toronto
In Toronto, securing a pre-approved mortgage puts you ahead of the competition. A pre-approval process allows a prospective homebuyer to know whether or not he/she meets a lender’s criteria for a mortgage…
Mortgage Investment Services Toronto
At Northwood Mortgage, we offer a range of mortgage investment services in Toronto, including alternative investment solutions for experienced investors looking for locally sheltered opportunities that generate fixed income.
Fixed Rate Mortgages Ontario
It is becoming increasingly tougher to follow mortgage rates in the midst of economic fluctuations, and situations that usually lead to reduced mortgage rates may not necessarily yield the expected outcome…
Mortgage Renewal Ontario
Many first-time homebuyers in Ontario use a mortgage to finance their purchase. Most, if not all, of these mortgages come with an amortization of between 20 and 30 years. But you are restricted to taking loans with a maximum term of 10 years…
Open Mortgages Toronto
One of the considerations when looking for a better mortgage is the amount of flexibility you want when repaying your mortgage.
Mortgage Solutions
If you want a high level of service and savings, Northwood Mortgage can help. We work with many of Canada’s most stable and reputable financial service companies to provide our clients with the best mortgage solutions.
Our two main service mortgage solutions offerings are Commercial and Industrial Mortgages and Residential 1st and 2nd Mortgages.
Commercial and Industrial Mortgages
Commercial and industrial buildings can be a good investment, especially when you have the right people on your side. Regardless of the size of your project – the opportunities are out there but it is up to you to seize them. Whether this is your first time or if you are a seasoned professional, you want to make sure that your financial affairs are in the best possible order. By having things in order, you will save so much time, money and effort.
A commercial mortgage loan helps to finance the purchase of a commercial property ( i.e. shopping centre, office building, apartment building or industrial complex). Commercial and industrial mortgage proceeds are usually used to obtain, refinance or to redevelop the property. The mortgages are designed in a way that meets the needs of both the lender and the borrower. The interest rate, loan amount, term/maturity, prepayment flexibility and amortization schedule are all key terms of a commercial/industrial mortgage.
If you are looking for finance options for any size project, we have experience in apartment buildings (fourplex, highrise, etc.), land servicing/development, institutional properties, specialty properties, raw land, office buildings, factories and plazas.
Residential 1st and 2nd Mortgages
Buying a home is a significant time in anyone’s life. Canada’s real estate market is booming, with many new and upcoming areas that may work for your budget, family and needs. Finding a mortgage can be an overwhelming process, especially for those who are having trouble finding a loan that fits their needs.
If you currently fall outside of traditional lending categories because of any of the following reasons:
- you are self-employed
- non-income verifiers
- you have credit issues
- you have been dealing with a financially distressing situation
- you are a new immigrant
We understand and value our clients and their unique needs, and our services and products reflect this. We can help you.
If you are taking on a first or second mortgage, we can help you to: 1) earn a return on your home equity through investments, 2) consolidate your debts (this will help you to improve cash flow) and 3) turn your home equity into cash when you need it for home repairs, renovations, educational financing, special events and much more.
Our commitment to you is to provide you with the very best. We want to get you up to 100% loan-to-value for your financing, prime mortgages well below the rates you’ll find anywhere else, bridge and construction financing options, high ratio second and third mortgages.
At Northwood Mortgage, we provide you with stability, savings and the service you need! Our dedicated and knowledgeable team is able to provide you with the best mortgage solutions for Commercial and Industrial Mortgages and Residential 1st and 2nd Mortgages!
Contact Us to ask a question, book an appointment with a specialist or for general information to help you get the best mortgage options out there
What is a mortgage?
A mortgage is a loan that uses a property as security to ensure that the debt is repaid. The borrower is referred to as the mortgagor, the lender as the mortgagee. The actual loan amount is referred to as the principal, and the mortgagor is expected to repay that principal, along with interest, over the repayment period (amortization) of the mortgage. A mortgage can be used for financing many different things, including:
- Purchasing or constructing a new home
- Purchasing an existing home
- Refinancing to consolidate debts
- Financing a renovation
- Financing the purchase of other investments
- Financing the purchase of investment property
Since a mortgage is a fully secured form of financing, the interest you pay is usually less than with most other types of financing. Many people use the equity in their homes to finance the purchase of investments. Using a Secured Line of Credit, or a fixed-rate mortgage, the interest costs are lower, and they can even write off those interest costs against their taxable incomes.
SIMPLE GLOSSARY OF MORTGAGE TERMS
Here is a simple glossary of mortgage terms. To help you find the term you are looking for quickly, simply click on the letter below. For example, to find the “mortgage”, click the letter “M”.
A
Agreement of Purchase and Sale: The legal contract a purchaser and a seller go into. We recommend that you have your offer prepared by a professional realtor that has the knowledge and experience to satisfactorily protect you with the most suitable clauses and conditions. Amortization Period: The number of years it takes to repay the entire amount of the financing based on a set of fixed payments. Appraisal: The process of determining the value of a property. Assets: What you own or can call upon. Often used in determining net worth or in securing financing. Assumption Agreement: A legal document signed by a buyer that requires the buyer assume responsibility for the obligations of an existing mortgage. If someone assumes your mortgage, make sure that you get a release from the mortgage company to ensure that you are no longer liable for the debt.
B
Blended Payments: Equal payments consisting of both an interest and a principal component. Typically, while the payment amount does not change, the principal portion increases, while the interest portion decreases.
C
Canada Mortgage and Housing Corporation (CMHC): CMHC is a federal Crown corporation that administers the National Housing Act (NHA). Among other services, they also insure mortgages for lenders that are greater than 75% of the purchase price or value of the home. The cost of that insurance is paid for by the borrower and is generally added to the mortgage amount. These mortgages are often referred to as “Hi-Ratio” mortgages. Closed Mortgage: A mortgage that cannot be prepaid or renegotiated. Closing Date: The date on which the new owner takes possession of the property and the sale becomes final. Conventional Mortgage: A mortgage up to 75% of the purchase price or the value of the property. A mortgage exceeding 75% is referred to as a “Hi-Ratio” mortgage and the lender will require insurance for that mortgage. Collateral: An asset, such as term deposit, Canada Savings Bond, or automobile, that you offer as security for a loan. Credit Scoring: A system that assesses a borrower on a number of items, assigning points that are used to determine the borrower’s credit worthiness.
D
Demand Loan: A loan where the balance must be repaid upon request. Deposit: A sum of money deposited in trust by the purchaser on making an offer to purchase. When the offer is accepted by the vendor (seller), the deposit is held in trust by the listing broker, lawyer, or notary until the closing of the sale, at which point it is given to the vendor. If a house does not close because of the purchaser’s failure to comply with the terms set out in the offer, the purchaser forgoes the deposit, and it is given to the vendor as compensation for the breaking of the contract (the offer).
E
Equity: The difference between the market value of the property and any outstanding mortgages registered against the property. This difference belongs to the owner of that property.
F
First Mortgage A debt registered against a property that has first call on that property. Fixed-Rate Mortgage: A mortgage for which the interest is set for the term of the mortgage.
G
Gross Debt Service (GDS.) Ratio: It is one of the mathematical calculations used by lenders to determine a borrower’s capacity to repay a mortgage. It takes into account the mortgage payments, property taxes, approximate heating costs, and 50% of any maintenance fees, and this sum is then divided by the gross income of the applicants. Ratios up to 32 % are acceptable. Guarantor: A person with an established credit rating and sufficient earnings who guarantees to repay the loan for the borrower if the borrower does not.
H
Hi-Ratio Mortgage: A mortgage that exceeds 75% of the purchase price or appraised value of the property. This type of mortgage must be insured. To avoid the cost of the insurance, a 1’st mortgage up to 75% is arranged and a 2’nd mortgage for the balance (up to 90% of the purchase price). Home Equity Line of Credit: A personal line of credit secured against the borrower’s property. Generally, up to 75% of the purchase price or appraised value of the property is allowed to be borrowed with this product.
I
Interest Adjustment Date (IAD): The date on which the mortgage term will begin. This date is usually the first day of the month following the closing. The interest cost for those days from the closing date to the first of the month are usually paid at closing. That is why it is always better to close your deal towards the end of the month. Interest-Only Mortgage: A mortgage on which only the monthly interest cost is paid each month. The full principal remains outstanding. The payment is lower than an amortized mortgage since once is not paying any principal.
M
Mortgage: A mortgage is a loan that uses a piece of real estate as a security. Once that loan is paid–off, the lender provides a discharge for that mortgage. Mortgagee: The financial institution or person (lender) who is lending the money using a mortgage. Mortgagor: The person who borrows the money using a mortgage.
O
Open Mortgage: A mortgage that can be repaid at any time during the term without any penalty. For this convenience, the interest rate is between 0.75-1.00% higher than a closed mortgage. A good option if you are planning to sell your property or pay–off the mortgage entirely.
P
P.I.T.: Principal, interest, and property tax due on a mortgage. If your down payment is greater than 25% of the purchase price or appraised value, the lender will allow you to make your own property tax payments. Portable Mortgage: An existing mortgage that can be transferred to a new property. One would want to port their mortgage in order to avoid any penalties, or if the interest rate is much lower than the current rates. Prime: The rate a financial institution charges its best customers. Prepayment Penalty: A fee charged a borrower by the lender when the borrower prepays all or part of a mortgage over and above the amount agreed upon. Although there is no law as to how a lender can charge you the penalty, a usual charge is the greater of the Interest Rate Differential (IRD) or 3 months interest. Principal: The original amount of a loan, before interest.
R
Rate Commitment: The number of days the lender will guarantee the mortgage rate on a mortgage approval. This can vary from lender to lender anywhere from 30 to 120 days. Renewal: When the mortgage term has concluded, your mortgage is up for renewal. It is open at this time for prepayment in part or in full, then renew with same lender or transfer to another lender at no cost (we can arrange).
S
Second Mortgage: A debt registered against a property that is secured by a second charge on the property. Switch: To transfer an existing mortgage from one financial institution to another. We can have this arranged for you at no cost to you.
T
Term: The period of time the financing agreement covers. The terms available are: 6 month, 1,2,3,4,5,6,7,10 year terms, and the interest rates will be fixed for whatever term once chooses. Total Debt Service (TDS) Ratio: It is the other mathematical calculations used by lenders to determine a borrower’s capacity to repay a mortgage. It takes into account the mortgage payments, property taxes, approximate heating costs, and 50% of any maintenance fees, and any other monthly obligations (i.e. personal loans, car payments, lines of credit, credit card debts, other mortgages, etc.), and this sum is then divided by the gross income of the applicants. Ratios up to 40 % are acceptable.
V
Variable-Rate Mortgage: A mortgage for which the interest rate fluctuates based on changes in prime. Vendor Take Back (VTB) mortgage: A mortgage provided by the vendor (seller) to the buyer.
COMMERCIAL AND RESIDENTIAL MORTGAGE SOLUTIONS
Northwood Mortgage Ltd. is one of the largest brokerage firms in the GTA, with over 50 years of experience in commercial, residential and industrial mortgages. Every year, our team of 160 experts loan half-a-billion dollars to homeowners and business to finance their investments. With all of the financial benefits that come with a mortgage, including security and investment opportunities, it is always a good time to look into taking out a mortgage.
We offer a variety of financing options for those looking to invest in their future, including commercial mortgages for businesses, and residential mortgages for future or current homeowners who are looking to finance a new home. For commercial and industrial mortgages, Northwood Mortgage offers the opportunity to finance a variety of sizes of projects, including plazas, factories, office buildings, raw land, institutional properties and apartment buildings.
We have established and work hard to maintain relationships with over 50 financial lending institutions, including banks and credit unions, which allows us to offer very competitive rates and some of the mortgage rates around. In addition, most of these rates are secured for up to four months.
We also extend our services to those who might generally not be eligible for loans, those with financial difficulty or a low credit rating, as well as newcomers to Canada and people who are self-employed. We make the process easy, with everything completed in one place.
Mortgage Options
At Northwood, we offer first and second mortgages and a variety of terms that can be selected, based upon your individual situation. We offer fixed or variable rate mortgages, open or closed mortgages, as well as high ratio and prime mortgages, all of which offer flexibility based on your unique needs. You can choose from a variety of payment options as well, including monthly, biweekly and weekly. We offer financing up to 100% of the loan to value.
Services
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Pre-Approved Mortgage Test
This is a free service which allows you to see how much you are eligible to borrow, before you start looking at properties.
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Mortgage Refinancing
This allows you to get better interest terms and rates. Use mortgage refinancing to consolidate your debts if your payments are getting out of control, or refinance a first and second mortgage into the first.
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Finance Investments via Home Equity
Take advantage of your home equity to make investments in education, home renovations or special events, like weddings. Certain investments will allow you to earn a return.
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Bridge Financing
This type of loan is useful during the period of selling a home and purchasing a new one.
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Reverse Mortgages
Receive up to 40% of the value of the appraised price of your home.
To discuss your upcoming commercial or residential mortgage, or to simply have one of our experts answer any questions you may have before beginning the mortgage process, get in touch with our team today. Or, for those looking to speak with a commercial and industrial specialist, speak with Steve Kates at steve@northwoodmortgage.com.
Our team of experts at Northwood Mortgage will work closely with you to ensure you receive the best options available! Contact us today for more information.
Hybrid mortgages
Many first-time home buyers opt for a 5-year fixed rate since their finances don’t have much room for interest risk. However, if you have good credit, are financially stable, and are able to save at least 5 percent of your monthly income, consider choosing a shorter fixed term and variable rates.
If you choose variable, find an option that keeps your payment the same, even with interest rate fluctuations. This will give you peace of mind when the rates begin to climb.
If you can’t decide between the two options, you should consider a hybrid mortgage. It allows you to split your mortgage into two different rates (perhaps half variable and half fixed) so you can take advantage of lower rates while cushioning yourself when the rates climb.
Portability options
For home buyers looking for a home where they intend to settle for more than five years, then portability, or the ability to move their mortgage to a new real estate without penalty, is not a top concern. If there is a chance that you will relocate after a couple of years, you should find the best portability options that provide you with:
- The best rates from your lender in the event that you need to add money to the mortgage, such as when upgrading to a more costly home
- More time to close your new mortgage after selling your old home, preferably more than 60 days
Low-frill mortgages
If you’re not considering making huge prepayments, refinancing, or moving in the next five years, you should consider low-frill mortgages. This option gives you a cheaper rate in exchange for bigger prepayment charges (penalties), smaller prepayment privileges, and in some cases, a restriction on refinancing with other lenders until your renewal date has passed.
Talk to our experienced Mortgage Agents and Brokers
When approaching your bank for a real estate mortgage in Toronto, you will be limited to the mortgage products that are specific to that bank, yet there may be many other, better suited options for you. No matter how big you think your bank is, it is always smart to involve an experienced mortgage broker, like a member of the team at Northwood Mortgage, to help you get the best mortgage deal in Toronto.
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