A guide to understanding mortgages I11C ISTET T LISTED GAIL] ° BIRD § What can I afford? As a genâ€" eral rule, no more than about oneâ€" third of assured more . ways . to finance a new home _ purchase than ever before, with a wide range of options, features and services. tions are offering property Of inada ne w n ind W#A * : #F% _ property value. The property value is established as the lesser of the purchase price or the appraised value. A highâ€" ratio (low downâ€" payment) mortâ€" gage exceeds 75% of the property value. Making a lower downpayâ€" ment can give you the opportunity to qualify for a mortâ€" gage loan sooner. shop for home What types of mortgages â€" are available? A conâ€" ventional mortâ€" gage does not exceed 75% of the Making a larger downpayment will decrease the amount you need to borrow. This can lower your mortâ€" gage payment, or even better, let you pay off the loan on your â€"home â€" as quickly as possiâ€" ble. When decidâ€" ing how much of a downpayment you can afford, howevâ€" er, be careful to set aside enough moving expenses, and furniture and appliances costs. money to cover the other expenses of buying a home, such as legal fees, payment of 5%, depending on the location and sellâ€" ing price of the home. minimum down SOUTH EAST house as secunty. A second mort eage can be a con venient way of financing, _ but you‘ll want to be sure you underâ€" stand the additionâ€" What is the d i f f e re n ce between a first and second mortâ€" gage? Some peoâ€" ple may have two separate loans or credit lines secured by the same home. This may happen if you are getting a loan from two difâ€" ferent sources to buy the home or when, as a homeâ€" owner, you borrow money for another purpose, such as a new car, using the house as security. with a wider price range, or put addiâ€" tional cash aside for landscaping, home furnishings, and other expensâ€" es.... Underâ€" the National Housing Act, this type of mortgage must be insured against default (see below) by CMHC or the 1 n s u_ r Company Canada. & M ates | 1A ;: O ~C"t a n Cc e a of JY property insurance, with the lender the rremiums _ are based on your age and on the amount of your mortgage when you apply for coverage. The cost can be added directly to the mortgage payment. If you are buying a new home, coverâ€" age will usually begin when your mortgage applicaâ€" tion is approved, even though your house may not be complicated. Joint life insurance covâ€" erage is available. Mortgage disabilâ€" ity insurance is also available. This plan can cover your â€" mortgage payment if you are unable to perform your usual job due to accident or illâ€" ness. In addition, the home itself must be covered Most borrowers choose to take mortgage _ life insurance, which is offered by most financial instituâ€" tions. Mortgage life insurance is designed to pay off the mortgage in the event of an insured person‘s death. In most circumâ€" stances this allows your estate, usually your family, to receive the home mortgageâ€"free. ty than the first mortgage when it comes to repayâ€" ment. Second mortgage can be the mortgage amount) is usually added to the loan amount, although it can be paid by the borrower in the lumpâ€"sum payment in advance. covered by default d insurance. What about (See RE 24