hchheda,
Well you do not have go for 15 year from start. I suggest take 25 years amortization. Most financial institute offer 15-20% lumpsum payment per year. take advantage of that.

By going in for 15 years your mortgage qualification criteria goes up. Just imagine if your situation changes and you cannot afford extra payments then you cannot go back to 25 and reduce payments. There is a percentage of what you can extend. That depends upon your house value at that time & balance & your credit situation. So a lot of unknowns.

In the nut shell go for 25 years then pay extra per year depending on what you can afford.

-Mercury

great replies everyone!

Good point by mercury about going 25 years mortagage and paying off quickly....which is possible only with 2 people working in the household(i.e, save one person's income for down payment)

The more i study the real estate..the more i want to stay away from it..

1) This article clearly says that unless you make substantially downpayment and fast repayment of the mortagage, the banks will eat you raw..

I believe, for a 200K house, the interest alone will come close to 140K..which means you are paying 340k for a house which you thought was 200k!! ....In other words, you are paying 340K for a 200k ownership.

Banks are trapping people in a vicious mortagage cycle....especially with new 0% and 5% downpayment options..This is more like a scam done legally.


seenappa

There seem to be concern that the interest amount paid totally is too high and too much.

Also please consider the advantage of Equity building. As a Mortgage Specialist I have no interest nor do I have a license selling Homes, but I will not discourage someone from homeownership because of the fact that at the end we have paid too much in cost of borrowing.

When we takeout a car loan we look at the convenience of tavelling. If we were to calculate the price of car plus the cost of running it (ie Fuel, Insurance and Maintainance) we would be using TTC or our local transit each day. We donot do that because of the convenience the car ownership give us..

.....simmillarly there are other benefits to pride of home ownership other than making monthly payments. Yes it would be foolish in somcases to buy a home that is bigger than what you need. Yes it would be foolish to buy a home very far from your work or schools or your place of worship(in case you are regular worshippers) At the end of the day, calculators besides there are other factors when purchasing a home to live in.

The problem is if you ask a 1000 friends on Mortgage terms and interest rates and about buying now versus later you will invariably get a 1000 different answers and be absolutely confused.

Our forefathers told us, ''It is always wise to have your ÖWN roof over your head"

Back in DES we were buying everthing for cash and here the system is called Amortised System. That is the nature of the animal in the Capitalist Society and there is little we can do unless we win a lottery and make a big downpayment.

Yes, My points are debatable but at the end of the day we must encourage every Desi to live in their own home (I can hear Realtors clapping at this)

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I just recently did a mortgage for a young couple who took most of their loans from relatives RRSP Savings plan. Your familys RRSP plans can also lend you money and that way you pay interest at the going rates to your own family. Please consult a licensed Financial Planner on how to go about this and feel free to call us as well for more info.

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We hope the above information hits home!!!

Kindest Regards,

S. Bhimani BA. (Mortgage Alliance Corp. of Canada) 416 970 0896

AND

S. J. Kanji AMP (HLC Mortgages Inc.) 1 800 265 2694

A good article on why we need a downpayment and what is the right amount to make.

http://articles.moneycentral.msn.com/Banking/HomeFinancing/WhyYouNeedAHomeDownPayment.aspx

seenappa

Hello Seenappa, fellow house hunters and other GTA veterans,

I've just started my research to look for a property to settle down.

I need some suggestions regarding the possibility of areas you think might fit my needs below.

- Proximity to the Financial district of Toronto (Say Downtown), an hour commute max.

- Good schooling area as my daughter is 5 years old and will be in Grade 1 next year.

- Not a notorious area.

- Based on the banks calculation, I can afford 320K house.

- Limiting to a 3 bedroom (2 storey) home that has a one bedroom basement atleast and the property is not aged beyond 10 years.

- Only place I managed to figure out is Markham. (Border of Scarborough), looking to drive in McCowan to take subway in Scarborough Town Center.

- access to some sort of public transportation as an alternate.(Go, Subway, Bus).


There might be some other people who also work in Downtown and researched for location. Please share your information.

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The cowards never started,
The weak died on the way,
Only the strong arrived.
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I seem to be a lone voice in this regard

but I think Durham region especially Pickering/Ajax is a good pick. It is well connected by GO train for the downtown and has good E-W connections (401, 407, Taunton/Steeles) - and is the most affordable townhome/detached-home real estate I've managed to find in GTA. For 320K, you'd be able to buy a new 42' detached home in Ajax whereas in Markham, it'd buy you a new 32' max. or a fairly small townhome. Resale prices too are lower in this area as opposed to most others.

I too have a 5 year old; I'll be moving to the region early next year and would be happy to post how I find the school experience there. Currently my daughter is attending Denlow which is a top TDSB school. York region schools are in general better than Durham (depending how much faith you put in EQAO scores) but Applecroft n Nottingham (only 1 year old) are pretty good schools in Durham.

Good luck with your search.

Rashmig,

Congrats on your new home. The prices that you have mentioned are almost same when you compare Peel and Halton regions. In Brampton and Milton, detached homes (36' and 1600-1700 sqft) start at 300K.

Both the above regions are connected to Toronto via GO Train. The outer suburbs of Toronto will gain pace, as more and more first time buyers/ new immigrants enter the market. These home are more affordable than comparable homes in the bordering Toronto suburbs and people see better value, even at the cost of some extra commute time everyday.

Someone who does not want to spend extra dollars and commuting time and want to live closer to his/her workplace in Toronto, the best options can be condominiums-freehold townhouse, condo townhouse, apartments.

Regards,

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