We see a lot of different tricks by lenders, but one of the worst is the zero down financing trap. They’ll offer you a second mortgage with an interest rate of up to 30%, but you won’t have to pay any money down. Oh no, none at all – but the higher the interest and the longer you don’t put any money down the more money you’re going to owe. The payments might start low, but the shock will come much later with a balloon payment. When you choose to work with us as your Toronto mortgage broker you’re going to get all the help you need to survive the mortgage game.
Why Zero Down is Bad
Zero down sounds fantastic in theory – I mean who doesn’t want to get something for nothing? But when it comes down to it, if you’re not putting money down you’re putting equity down as collateral. This is the last thing you want to do, you want to be able to get a fair loan and fair terms for the LIFE of the loan, not just the beginning. This is exactly why you want to choose us as your Canada mortgage broker. We’ll be able to help you know when a deal is too good to pass up and when it’s time to let a bad one pass you by.
It’s Cheap in the Beginning
Many second mortgages will be really cheap in the beginning, which is great. You can pay as you go and you aren’t too worried about it. You keep paying down your debts, putting more and more of the money that probably should go towards your second mortgage or home equity loan towards other bills and expenses. The bill is low, why worry right? Wrong. Each minimum monthly payment you make goes more and more towards interest, not the original amount you borrowed. You end up on a debt treadmill to nowhere.
Then It Costs More
Even if you’ve been keeping up with the payments on your home equity loan or second mortgage, if it’s structured all wrong. Working with one of our Canada mortgage brokers is the best way to avoid this kind of problem. We’ll be able to help you get the most for your money. You don’t want to end up with one that puts you underwater, robbing you of your home and your savings.
Avoid Sky High Interest Rates
Sky high interest rates are one of those things that put you under. You want to get it as low as possible – with interest rates at near all-time lows you can find rates as low as 3% depending on your kind of financing. There are variable rate second mortgages, fixed rate, combination and more – what’s important is that you’re getting the one that’s right for you. Contact us and see what the best Toronto mortgage brokers in the business can do for you.