Empowering Canadian homeowners to secure their financial futures

introduction

What is a Mortgage (Purchase)

A mortgage is a type of loan used to finance the purchase of a new home. It is a financial arrangement between a borrower and a lender, where the lender provides funds to the borrower to buy a property. The borrower then repays the loan amount, plus interest, over a specified period, usually through monthly payments.

perks of a mortgage

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Homeownership
A mortgage enables you to become a homeowner, giving you the freedom to customize your living space and build equity over time.
With a fixed-rate mortgage, your monthly payments remain consistent throughout the loan term, providing stability and predictability for budgeting.

Homeownership may come with tax benefits, such as deductions for mortgage interest and property taxes, potentially reducing your overall tax liability.

As you make mortgage payments, you build equity in your home, which can serve as a valuable asset and provide financial security for the future.
Real estate has the potential to appreciate over time, increasing the value of your home and potentially yielding a return on your investment.
Unlike renting, homeownership gives you the freedom to personalize your living space according to your preferences, whether through renovations, landscaping, or décor choices.
Owning a home can provide a sense of stability and security for you and your family, knowing that you have a place to call your own and build lasting memories.
Homeownership often fosters a sense of community involvement and pride, as homeowners tend to be more invested in their neighborhoods and local initiatives.
If you purchase a multi-unit property or have extra space, you may have the option to rent out a portion of your home, providing an additional source of income.

who can benefit

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First-time homebuyers

Mortgages are often tailored to meet the needs of first-time buyers, providing them with the financing necessary to achieve homeownership.

Individuals or families who are looking to upgrade to a larger or more desirable home can benefit from a mortgage to finance their new property.
Empty nesters or retirees looking to downsize to a smaller home or condo can use a mortgage to facilitate the transition and access equity from their current home.

Investors looking to purchase properties for rental income or future appreciation can utilize mortgages to finance their investment properties.

Individuals or families who are relocating for work or personal reasons can use a mortgage to finance their new home in a different location.
Self-employed individuals who may have difficulty qualifying for traditional mortgages due to irregular income or complex financial situations can still access mortgages tailored to their needs.
Immigrants or foreign nationals looking to purchase property in the country where they reside or invest can use mortgages designed for non-citizens.

Families who are expanding or planning to grow in the future can benefit from a mortgage to accommodate their changing housing needs.

Buyers who are willing to invest in a fixer-upper or undertake renovation projects can use a mortgage that includes funds for home improvements.

how it works

Get approved for a mortgage in a few simple steps

01

Pre-Approval

The borrower applies for a mortgage pre-approval from a lender to determine the maximum loan amount they qualify for based on their financial situation, credit history, and other factors.

02

House-Hunting

With the pre-approval in hand, the borrower starts searching for a suitable property within their budget. Once they find a home they want to buy, they make an offer to the seller.

03

Loan Application

After the seller accepts the offer, the borrower submits a formal loan application to the lender. The lender reviews the application, verifies the borrower's information, and assesses the property's value.

04

Underwriting

The lender conducts a thorough underwriting process to assess the borrower's creditworthiness and the property's suitability as collateral for the loan. This may involve income verification, credit checks, and appraisal of the property.

05

Approval and Closing

If the lender approves the loan, the borrower receives a commitment letter outlining the terms and conditions of the mortgage. The borrower and seller then proceed to close the sale, where the mortgage documents are signed, and ownership of the property is transferred to the buyer.

06

Outstanding Loans

fter closing, the borrower begins making monthly mortgage payments to the lender. These payments typically include principal and interest and may also include property taxes and insurance, which the lender may collect and hold in an escrow account.

Common questions

What is the difference between pre-qualification and pre-approval?
Pre-qualification is an informal estimate of how much you might be able to borrow based on basic financial information provided to the lender. Pre-approval is a more thorough assessment of your financial situation, including income verification and credit checks, resulting in a conditional commitment from the lender for a specific loan amount.
The minimum down payment depends on various factors, including the type of mortgage, the lender’s requirements, and the borrower’s financial situation. In Canada, for example, the minimum down payment for a home purchase is typically 5% of the purchase price.

The timeline for securing a purchase mortgage can vary depending on factors such as the lender’s efficiency, the complexity of the borrower’s financial situation, and the local real estate market. On average, it takes anywhere from 30 to 45 days from the time of application to closing.

sucess stories

Meet Sarah and Michael Turner, a young couple residing in Toronto, Ontario. Sarah, a freelance graphic designer, and Michael, a software engineer, had a dream of owning their own home.

However, their journey to homeownership faced a significant hurdle when they were unable to secure mortgage approval from their bank.

Sarah and Michael’s success story illustrates how Wyn Financial can help aspiring homeowners overcome initial challenges and work toward achieving their homeownership dreams. We are committed to providing innovative solutions and personalized guidance to ensure every client’s path to homeownership is as smooth as possible.
If you’re facing hurdles in your quest for homeownership, whether it’s due to income limitations, credit issues, or other challenges, Wyn Financial is here to help you find the right mortgage solution and guide you every step of the way. Your journey to homeownership starts with us.
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case study

The challenge
  • Sarah and Michael’s combined income didn’t meet the stringent requirements of their bank.
  • A lack of significant down payment made them ineligible for a traditional mortgage.
  • Desire to own a home but unable to find an alternative lender due to limited financial resources.

Determined to make their homeownership dream a reality, Sarah and Michael sought the expertise of Wyn Financial, who had access to a diverse network of lenders. Here’s how we helped them:

  1. Comprehensive Financial Assessment: Wyn Financial conducted a detailed analysis of Sarah and Michael’s financial situation, identifying areas for improvement.

  2. Alternative Mortgage Solution: Recognizing their potential and commitment, we connected Sarah and Michael with an alternative lender willing to extend their debt-to-income ratios, allowing them to afford their dream home.

  3. Strategic Financial Planning: We worked closely with the couple to create a personalized financial plan, emphasizing savings and credit improvement to eventually transition them back to their bank.

  4. Regular Monitoring: Over the course of a year, Wyn Financial monitored Sarah and Michael’s financial progress, providing guidance and support to help them achieve their goals.

  5. Successful Transition: With improved credit scores and increased savings, Sarah and Michael successfully transitioned back to their bank, where they were now eligible for a traditional mortgage.

Thanks to the dedicated support and guidance of Wyn Financial, Sarah and Michael Turner achieved the following milestones:

  • Obtained an alternative mortgage solution to fulfill their dream of homeownership, thanks to lenders willing to extend their debt-to-income ratios.
  • Improved their financial situation significantly over a year, including enhancing their credit scores and saving for a down payment.
  • Successfully transitioned back to their bank, securing a traditional mortgage for their new home.

introduction

Learn more about reverse mortgage

A reverse mortgage offers several perks and can benefit a specific group of individuals under particular circumstances. 

perks of a reverse mortgage

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Supplemental income

A reverse mortgage provides a steady source of tax-free income for retirees, helping them maintain their desired lifestyle and cover everyday expenses without relying solely on their savings or pensions.

Homeowners can access the equity they’ve built up in their homes over the years without needing to sell the property. This is particularly beneficial for those who want to unlock their wealth tied up in their homes.

Unlike traditional mortgages, reverse mortgages do not require monthly principal and interest payments. This no-payment structure eases financial stress, especially for those living on a fixed income.

With a reverse mortgage, homeowners retain full ownership and control of their homes. They can continue living in their homes for as long as they wish, as long as they meet specific obligations, such as property tax and insurance payments.

Reverse mortgages offer flexibility in how you can receive funds. Options include lump-sum payments, monthly payments, or a combination of these, allowing you to choose what best suits your financial goals.

In Canada, reverse mortgages are designed to ensure that the loan amount never exceeds the market value of the home. This protects borrowers from owing more than their property is worth, even if property values decline.

A reverse mortgage typically does not affect government benefits like Old Age Security or the Canadian Pension Plan, as the loan proceeds are considered loan advances, not income.

A reverse mortgage can be integrated into estate planning strategies, allowing homeowners to access home equity while preserving other assets for inheritance purposes.

Who Can Benefit

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Seniors & Retirees

Reverse mortgages are primarily designed for seniors aged 55 and older who are looking for additional financial support during their retirement years.

Individuals with a considerable amount of equity tied up in their homes can benefit by converting this wealth into usable funds without selling their property.

Anyone looking for financial flexibility, whether it’s to cover everyday expenses, invest in home improvements, travel, or simply have peace of mind in their retirement, can benefit from a reverse mortgage.

Many seniors wish to remain in their homes as they age. A reverse mortgage can help them achieve this goal by providing financial resources for in-home care or home modifications to enhance accessibility and comfort.

For those with limited retirement savings or investments, a reverse mortgage can serve as a financial lifeline to support their retirement.

A reverse mortgage can act as a financial safety net, providing funds for unexpected expenses or emergencies, such as medical bills or home repairs.

Individuals who want to balance their financial portfolio and protect other assets for their heirs may find a reverse mortgage to be a valuable part of their estate planning strategy.

It's essential to remember that while a reverse mortgage offers significant advantages, it may not be suitable for everyone. Each person's financial situation and goals are unique, so seeking advice from a qualified financial advisor and conducting a thorough evaluation can help determine if a reverse mortgage is the right choice for your specific circumstances.

how it works

Obtain a reverse mortgage in a few simple steps

01

Eligibility check

Ensure you are at least 55 years old. Verify that you own a home that is your primary residence. Confirm that your home is in a livable condition.

02

Application

Apply for a reverse mortgage. Provide information about your age, home's location, type, and appraised value. Include all individuals listed on your home's title who are at least 55 years old.

03

Appraisal

An appraisal of your home is usually necessary to determine its correct valuation. Some lenders may cover this cost.

04

Complete the file

Ensure all required documentation and information are provided to the lender.

05

Legal Advice and Family Discussion

Before committing to the reverse mortgage, it's recommended to obtain legal advice from a lawyer and discuss the decision with family members, if desired.

06

Outstanding Loans

If you have any existing loans or lines of credit secured by your home, they must be paid off with the reverse mortgage funds.

07

Receiving Funds

Once the lender processes your application and the necessary steps are completed, you will receive the funds.- You can choose to receive the money as a lump sum or through periodic withdrawals.

Remember reverse mortgage allows you to access your home's equity without making monthly payments.

Common questions

What is a reverse mortgage?
A reverse mortgage is a financial product that allows homeowners, typically aged 55 or older, to access a portion of their home equity without selling their home. The loan is repaid when the homeowner moves, sells the home, or passes away.

Bloom lends to customers all across the credit spectrum. Since there are no payments required, credit score isn’t as important for a reverse mortgage as it is for a traditional mortgage.

To qualify, you must be a homeowner aged 55 or older, and the home must be your primary residence. All individuals listed on the home’s title must meet the age requirement. Your home’s condition, type, and appraised value will also be considered.

No, you will not owe more than what your home is worth with a reverse mortgage, thanks to the Home Equity Guarantee. In the rare event that the outstanding loan balance surpasses the fair value of your home when it’s time to repay the loan, you will not be required to pay more than the home’s fair value. This guarantee provides added security and peace of mind to reverse mortgage borrowers.

No, one of the benefits of a reverse mortgage is that you are not required to make monthly payments. However, you have the option to make voluntary payments.

No, you will not be forced to sell or move out of your home due to a reverse mortgage. You maintain ownership and control of your home as long as you meet certain obligations, such as paying property taxes and insurance.

The amount you can borrow depends on factors like your age, your home’s appraised value, and the lender’s terms. Typically, you can borrow up to 55% of your home’s value, but the actual amount may be less.

You can use the funds for various purposes, such as paying off an existing mortgage, home renovations, covering daily expenses, medical bills, helping family members, travel, or improving your quality of life. There are no restrictions on how you use the money.

Interest on a reverse mortgage is calculated on the outstanding balance and is usually compounded semi-annually. This means the interest is added to the balance twice a year. A Home Equity Line of Credit, on the other hand, actually compounds monthly.

Will a reverse mortgage affect my government benefits?

No, a reverse mortgage generally does not affect government benefits like Old Age Security (OAS) or Guaranteed Income Supplement (GIS). It’s tax-free, and the borrowed money is not considered income.

In most cases, homeowners still have equity remaining in their home after repaying the reverse mortgage. Over 99% of Canadians who took out a reverse mortgage had money left over when the loan was paid off.

Repayment is triggered when you sell your home, move out, or the last borrower passes away. The loan balance, including accrued interest, must be repaid. Your estate is responsible for the repayment.

Yes, you can use the funds from a reverse mortgage to pay off your existing mortgage. The reverse mortgage funds must first be used to clear any outstanding loans secured against your home.

Yes, you can move out of your home if you have a reverse mortgage. There are no restrictions on moving. However, the loan will need to be repaid when you sell the home or move.

Reverse mortgages may have penalties for early repayment, but these penalties typically apply during the first 5-10 years of the loan term. The specific terms may vary among lenders.

If your spouse is under 55 and is listed on the title of the home, you may not qualify for a reverse mortgage. All individuals on the title must meet the age requirement.
Common fees may include an administration fee, a setup fee, legal fees for closing costs or independent legal advice, and a prepayment penalty if you pay off the reverse mortgage early. These fees should be disclosed to you before signing the contract.

sucess stories

Tina and her husband Phil bought their dream home in Maple, Ontario in 1989. They raised their three children there, who are now all grown up and have kids of their own.

Tina’s son is now also a homeowner, but with the dramatic rise in home prices in the GTA, her two daughters have struggled to get into the housing market.

After Phil’s passing, Tina evaluated her finances with the help of her financial advisor. She was reassured that – when taking into consideration the wealth she’s built in her home – she will have more than enough resources to last her through the rest of her life.Realizing that she doesn’t need to wait until she’s gone to begin helping her children financially, Tina decided to unlock some of the equity in her home today.

Keeping residential mortgage simple

Tina is dividing her Reverse Mortgage proceeds equally between her two daughters, who are using the funds to make down payments on homes of their own.

case study

Client situation
  • Widowed woman age 84
  • Government pension income $21K
  • Mortgage debts $256K
  • Other unsecured debts $36K
  • Unable to manage monthly payments and cost of living expenses
  • Home value $1.2 million
  • Age in place
  • Make accessibility renovations
  • Fund daily expenses, home maintenance costs and pay off debt
  • Positive monthly cash flow established
  • Used some of the proceeds to upgrade the home to make it senior friendly
  • Released $642K
  • Paid off Mortgage
  • Paid off Debt

Client enjoys peace of mind, knowing she can remain in the home she loves, and comfortably manage her expenses. Their mortgage broker was well compensated for the referral.

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Fill out the Pre-assessment form and let Wyn Financial guide you to a secure and worry-free financial future. Your journey begins now.