Construction Mortgage in Canada: What you Need to Know


To save money and design the home of their dreams, many people choose to build their homes from the starting level with the map in mind. When making a home, one has to consider how they will finance the big project. One loan option many people choose is the Construction Mortgage.

What is Construction Mortgage?
A construction mortgage is a loan that is used to finance the building of a home. The money is usually given to the borrower in set amounts at each stage of the construction process is completed. Most construction mortgages involve paying the interest only during the construction period with full repayment required after the owner obtains a certificate of occupancy.



There is no denying that many people are looking for a construction mortgage in Canada, as they find it a better option to deal with the variable mortgage rate so that you can get your home with the best mortgage priorities and dealings.

What Are the Requirements to Get Qualified for Construction Mortgage?

·         Stable monthly income
·         Excellent credit history
·         20% down payment
·         Low debt-to-income ratio

One should always know that these requirements are necessary to keep up with mortgage lenders. These lenders need to ensure you can afford the fees plus the interest and any extra and surprise expenses.


Why do People Opt for Construction Mortgage over Residential Mortgage?
It has been seen that people in Canada are fascinated with the low mortgage rates, as with this they can see construction to a permanent financing plan where the construction loan is switched to a mortgage loan after the certification in the specific things given out. One can also get a higher construction mortgage in Canada and then get a better mortgage rate when you switch to the traditional way of opting for the financing. With this, it is essential to remember that with a variable rate, repayments can fluctuate each month. Generally, construction mortgage rates are quoted on a prime plus basis.

Important tip: When considering this type of mortgage, it is vital to understand how it works, the cost to build, and the repayment terms and conditions. With the right knowledge, it will not be long before you are living in your dream home.

Wrapping Up
Hence, if you are seeking more information on construction mortgages in Canada, then connecting with RateShop.ca is the best decision by your side. Based in Mississauga Canada, they are one of the top professionals from whom one can seek information on mortgages, insurances, credit cards, and cheap money transfers!

Location: Mississauga, ON, Canada

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