can someone help me please

[Velvet Revolver]

here is a quote from cmhc on mortgages and i would like to know what they mean by principle. if the mortgage rate is 3% and the house is $300k and I need 5% down means i need $15k down

i however have been looking at it wrong because i then thought i needed $710/m (3% on $285k) for the interest but there is more to it then just paying off the interest need to pay off the principle to. the td calculator states payment of $1350/m that is $640/m paying down the mortgage is that then the principle?

the other fee's and expenses i did not realize is the legal fees are 1.5%-4% of the price

land tax around here is just a hair above a half a percent.

 

so in conclusion i can still think of it as 3% but i need to double that for what the bank wants each month.

Quote

Your total monthly housing costs, including Principal, Interest, property Taxes, Heating (P.I.T.H.), the annual site lease in the case of leasehold tenure and 50% of applicable condominium fees, shouldn’t represent more than 32% of your gross household income (Gross Debt Service (GDS) ratio). Use the GDS form to calculate how much you can afford in housing costs to be eligible.

 

[brenan999]

Principle is the amount remaining in the loan, so that $640 of that payment goes against the remainder $285 000 which is the remaining amount. But you have to be approved on the loan as though you are paying $300 000. It's part of the new laws our government just handed down. Even though they require that downpayment making it the 285 you have to be able to pay for a mortgage at the higher amount. Essentially they look at the Principle as $300 000 then you pay your $15 000 and and your payments will go against your new principle.

 

I know it's silly but try going to a mortgage broker they are able to help and you may even be able to get a better rate. Not sure where you are but The Mortgage Centre has offices all over Canada and I used the one here and they were great.

[Velvet Revolver]

interesting new laws that laugh in the face of the usa scam

Instituting a 20 per cent minimum down payment for non-owner occupied properties.

Limiting borrowing to a maximum of 80 per cent of the value of their homes when refinancing, a drop from 95 per cent.

Limiting the maximum gross debt service (GDS) ratio to 39 per cent and the maximum total debt service (TDS) ratio to 44 per cent.

Requiring banks to qualify all borrowers applying for an insured mortgage at the Bank of Canada’s conventional five-year fixed posted mortgage rate, an interest rate that is typically higher than what they will actually be paying.

Reducing the maximum amortization period for insured mortgages from 40 years to 25 years.

Requiring a down payment of at least five per cent of the home purchase price. A further 10 per cent must be added to the down payment for the portion of the house price between $500,000 and $999,999. For non-owner occupied properties, a minimum down payment of at least 20 per cent is mandatory.

 

I have not found this one you mention anywhere

9 hours ago, brenan999 said:

But you have to be approved on the loan as though you are paying $300 000.

 

[brenan999]

Thats how it was explained to me. Again your best bet is to go talk to a broker and not a tech forum.

[Velvet Revolver]

yes the question i had to the principle is advanced, i should have found a finance forum.