Home Buying FAQ

Frequently Asked Questions

How much of a downpayment will I need?

This is the first question many people will ask me when starting the process of purchasing a property.

The downpayment usually represents between 5-20% of the total price of the property. This is something we should sit down and discuss as there are different ways to provide this down payment. If you're thinking of borrowring your down payment, there are still some options. Read more about the Flex-Down program HERE.

Should I get pre-approved for a mortgage before I start looking for a house?


Getting pre-approved for a mortgage is an important first step when buying a new home. By taking this step, you’ll know in better detail how much you can afford when shopping for your new home. You will be able to know what your expected mortgage payments will be. You may also be offered a Rate Hold, which gives you the peace of mind of having a guaranteed interest rate for a period of time. This can be a great tool to keep you sleeping soundly and not worrying about whether rates are going up. We are also often able to bring your rate down should interest rates decline.

Contact me at 250.682.0908 when you're ready to take this first step. I work for you, and as such there is no cost and no obligation to meet and discuss your options.

High-Ratio vs. Conventional

A high-ratio mortgage generally means that your mortgage exceed 80% of the property's value. What this means for you is that your lender will require you to have high-ratio mortgage default insurance on your property to insure their investment. There are different options and programs to suit all types of borrowers and I'm happy to provide more info at any time.

What is the difference between High Ratio Mortgage Insurance and Mortgage Life Insurance?

High Ratio Mortgage Insurance protects the lender against payment default by the home buyer. It is required by most lenders if the home buyer has less than 20% downpayment. An insurance premium will apply. Mortgage Life Insurance is different, and protects your dependents and loved ones in the event of your death or permanent disability.

What about Closing Costs?

Closing costs are the costs associated to completing a real estate transaction. These can include things like Appraisal Fees, Legal Fees, Property Transfer Tax, Prepaid Property Tax/Utility Adjustments, or GST*. See my Glossary page for more info on any of these costs, or contact me for more info. We will discuss these in more detail during the application process.

When the mortgage lender pays the Property Taxes, how are payments calculated?

The estimated amount of your Property Taxes can be added to the mortgage payment and paid on your behalf at the appropriate times. Depending on the balance in your tax account, it may be necessary to increase or decrease the amount of monthly payments to reflect the timing of Property Tax payments.*

Can we make changes to the mortgage application, such as length of term, repayment frequency, etc., once the application has been submitted?

Yes. Your ideal mortgage formula has probably already been created, but if you want to consider a change let's review the possible benefits and implications. Each and every lender has unique rules about what can be changed and when and it's my job to keep track of the options and direct you as needed.

Is GST paid on a resale home?

There is no GST unless the house has been renovated substantially, and then the tax is applied as if it were a new house.*

What is an IAD or Interest Adjustment Date?

If your transaction is due to close in the middle of the month, but your regular mortgage payments are set for the start of the month, your first mortgage payment could be delayed for several weeks. To cover this, a date is set as the IAD and an amount is collected on closing to cover this Interest Adjustment Date period.

 * Tax information consists of general comments only, for full details see the applicable legislation or review with your advisor.

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Our office can be found at:

Ryan W. Smith - Mortgage Broker
Mortgage West
242 Victoria Street, Suite 207, Kamloops BC.
Phone: 250.682.0908

Our regular office hours are:

Monday - Friday, 8:30AM - 5:00PM