Mortgage FAQ

The minimum down payment depends on the purchase price: • Under $500,000: 5% minimum • $500,000 to $999,999: 5% on the first $500K + 10% on the portion above • $1,000,000 or more: 20% minimum For example, a $700,000 home requires $25,000 (5% of $500K) + $20,000 (10% of $200K) = $45,000 minimum down payment.

A pre-approval is a formal review of your finances by a lender. They pull your credit, verify your income and debts, and issue a written commitment for a specific mortgage amount at a locked-in rate (usually valid for 90-120 days). It tells you exactly how much you can afford, protects you from rate increases while you shop, and shows sellers you are a serious buyer with financing confirmed.

The stress test is a federal requirement that ensures you can afford payments at a higher rate than your actual mortgage rate. You must qualify at the greater of: your contract rate + 2%, or 5.25% (whichever is higher). This applies to all buyers, even those with 20%+ down payment. It reduces the maximum amount you can borrow compared to your actual rate.

A pre-approval typically takes 24-48 hours once all documents are submitted. A full approval (after you have an accepted offer on a property) takes 3-5 business days for straightforward files. Complex files (self-employed, commercial, private lending) may take 1-2 weeks. Working with a broker speeds this up because we know exactly what each lender needs upfront.

Fixed rate: Your rate stays the same for the entire term (typically 5 years). Best if you want predictable payments and peace of mind. Variable rate: Your rate fluctuates with the Bank of Canada’s overnight rate. Historically, variable rates have saved borrowers money over time, but they come with payment uncertainty. In 2026, with the BoC cutting rates, variable rates are attractive. But it depends on your risk tolerance and how long you plan to stay in the home. We help you decide based on your specific situation.

Term: The length of your contract with the lender (usually 1-5 years). When the term ends, you renew or switch lenders. Amortization: The total time to pay off the mortgage (usually 25 or 30 years). A longer amortization means lower monthly payments but more interest over time. For example, you might have a 5-year fixed term within a 25-year amortization.

Most mortgages allow prepayments, but the terms vary by lender. Common options include: • Lump sum payments: Typically 10-20% of the original balance per year • Payment increases: Increase your regular payment by 10-20% per year • Double-up payments: Make an extra payment that goes entirely to principal Always check your prepayment privileges before signing. Breaking these limits triggers penalties.

Yes. Several lenders have programs designed for self-employed borrowers, including: • Stated income programs (declare your income with 12 months of bank statements) • Add-back programs (deductions like vehicle and home office are added back to income) • Bank statement programs (lenders review deposits to calculate income) You typically need 2+ years in business and may need 10-20% down payment instead of 5%. We work with self-employed clients every week.

Yes. Most major banks have newcomer programs for permanent residents and work permit holders who have been in Canada less than 5 years. Benefits include: • Down payment as low as 5% • No Canadian credit history required (some lenders) • International credit or bank references accepted • Employment letter sufficient for income verification At E7 Mortgages, we serve newcomer families in English, Cantonese, and Mandarin.

Almost never. Your bank’s renewal offer is rarely their best rate — they count on you signing out of convenience. A 0.40% rate difference on a $500,000 mortgage saves approximately $6,600 over a 5-year term. Contact a broker 4-6 months before renewal. We shop your renewal across 30+ lenders and often find rates significantly lower than your bank’s initial offer. Switching lenders at renewal is free in most cases.

Refinancing means replacing your current mortgage with a new one. Common reasons: • Access home equity for renovations or investing (borrow up to 80% of home value) • Consolidate high-interest debt (replace 20%+ credit card rates with a 4-5% mortgage rate) • Get a lower rate if current rates are better than what you locked in • Remove a co-signer or ex-spouse from the mortgage There are costs (penalty, appraisal, legal fees), so we always run the numbers to make sure it is worth it.

The penalty depends on your mortgage type: • Variable rate: Usually 3 months’ interest (e.g., $2,000-$4,000 on a $500K mortgage) • Fixed rate: The greater of 3 months’ interest OR the Interest Rate Differential (IRD) — which can be $8,000-$20,000+ depending on your rate vs. current rates Call your lender for an exact quote, or ask us — we can estimate it for you.

For standard residential mortgages, our service is completely free to you. The lender pays the broker fee when your mortgage funds. You get access to 30+ lenders and expert advice at no cost. For private mortgages or complex commercial deals, there may be a broker fee (typically 1-2% of the loan amount), which we disclose upfront before you commit to anything.

Your bank can only offer their own products. A broker compares rates and terms from 30+ lenders — banks, credit unions, monoline lenders, and alternative lenders — to find the best fit for your situation. Brokers are especially valuable for: • Self-employed borrowers (we know which lenders are flexible) • Renewals (we negotiate against your bank’s offer) • Complex situations (new to Canada, credit issues, investment properties) • Commercial deals (access to specialty lenders your bank does not have)

We serve all of British Columbia, with a focus on Richmond, Vancouver, Burnaby, Surrey, Coquitlam, and the Lower Mainland. For commercial and private lending deals, we work across BC. All consultations are free — call (778) 834-9618 or WhatsApp us.