Competition = Low Mortgage Rates

Fixed Rate vs. Variable Rate

FIXED RATE
A "fixed rate" mortgage simply means that the interest rate on the money you borrow stays at a locked or "fixed" rate. This means that your interest rate is not subject to change and the rate at which you pay back your loan is always the same. There are some advantages to having a fixed rate when you consider the nature of the inflation rate. The value of your home should continue to increase year to year while the principle amount will continue to decrease.

VARIABLE RATE
A "variable rate" mortgage or below prime rate mortgage is a mortgage where the interest rate is subject to change depending on the prime rate. Most of these mortgage products are based on a formula using the prime interest rate less a discount. For example, if you choose a below prime rate mortgage with a rate of Prime minus 0.5% then your rate would be calculated at any given time using this formula. So if prime were 4% then the interest rate on your mortgage would be 3.5%.

Shaping the Industry

Alberta Equity Mortgages is owned by The Canadian Equity Group Inc (CEG), and CEG works closely together with major lenders in Canada not only finding the best overall products, but also developing new and innovative products for the consumer market.

As a national company, they have the privilege of making these products available to the entire country.

This gives The Canadian Equity Group great pride in knowing they are capable of not only influencing the mortgage industry in Canada, but also making sure that more products and services are available in the future.

Lender vs. Broker...

Many people have asked us what the difference is between a mortgage broker and a mortgage lender. A mortgage broker is a trained professional that has access to loan products of different lenders and is licensed to provide you with the best advice for your mortgage needs. Mortgage brokers do not lend money. Most brokerages are small firms providing expertise services and counseling rather than loans. The lender is the one who provides the money to the borrower at the closing table. The lender also makes the final decision regarding loan approval.

So why can't you skip the middle man and go straight to the lender? Many lenders will not deal with the public for a number of reasons. For one, the cost in promoting would be too great. For example, there are many mortgage lenders based in Calgary, Alberta alone. Bridgewater, MRS Trust, Gibraltar Mortgage just to name a few. But how many of those have you actually heard of? Another reason is administration. There is a lot of paperwork involved when you close a mortgage agreement, and it just makes sense dividing up the work amongst the brokers.

When Applying for your Mortgage

When applying for your mortgage it is beneficial to have the following information readily available:

• A current salary statement or letter from your employer
• A confirmation such as a letter or bank statement showing the source of your down payment
• Financial statements for the last three years and personal income tax returns if you are self employed
• A copy of the accepted purchase offer
• Details on the property being purchased such a land survey or an MLS print out
• Building plans, specifications, and the builder agreement if you are buying a home that is to be constructed

We need your help!

It's the middle of the month, and we're looking for your input. Our next major update is now only two weeks away and we would like to hear your comments or suggestions.

If you would like to see a new mortgage calculator, new statistics, articles or areas within our website, please enter your suggestions here.