(PRWEB) May 03, 2013
Marcus Arkan, CTO of leading Canadian mortgage firm Syndicate Mortgages cautions new home buyers against purchasing new real estate without taking potential penalties into account. According to a recent post by Mr. Arkan, there are certain types of closing costs that are associated with prepaid mortgages.
When asked why future homeowners might need to be aware of the potential penalties, the CTO had this to say, “Most families would rather get their payments off their hands as fast as they can. Unfortunately, what most of them do not realize is that the down payment and monthly payments are not the only aspects that they will have to deal with down the road. Budgeting for a mortgage is a good idea but it does come with its fair share of traps. If it was easy, wouldn’t everyone else be doing it?”
Mr. Arkan also explains that accelerating payments might also prove to be a costly prospect for homeowners. He directs his opinion towards current mortgage holders who might believe that paying off their mortgages through lump sums will help their financial situations.
In fact, as Mr. Arkan points out, such people might have to save up a considerable amount beforehand. This is especially considering the 5% down payment amount that lenders will ask for in the case of monthly payments. Mortgage holders will also have to opt for mortgage insurance in such cases as well. The mortgage insurance might also end up costing more for the amount of the total payments which is why the CTO also cautions property owners to be aware of the fact.
The bottom line, according to Mr. Arkan, is that lenders will still charge mortgage holders in penalty amounts in case they are looking to break their mortgages early. This can depend on a number of factors. The real estate expert opines that the cause can be pre-defined IRDs (Interest Rate Differentials). Another cause can be interest payments that can accumulate in a three month prepayment plan.
The CTO concludes his analysis by stating that paying off mortgages beforehand can still be a lucrative way for people to deal with fluctuating interest rates despite the hidden penalties.
About Syndicate Mortgages
Syndicate Mortgages is a firm that specializes in aiding customers in finding the best mortgage deals in Canada. The company comprises of industry specialists whose experience whose make it convenient for clients to locate mortgages rates that suit them the best. The real estate firm has access to a wide variety of lending institutions across the country like credit unions, major banks, trust companies as well as private funds. Syndicate Mortgages also has contact with as many as 70 Canadian mortgage lenders at its disposal.
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