Buying a home can be an exciting and challenging experience. When you’ve made your choices on location, size and style, you then have to prepare for costs and deal with your mortgage application. There is a huge range of options to choose from when deciding on a mortgage provider.

Why comparing mortgage rates matters

Buying a home is a huge investment. Whether you’re a first-time buyer or not, it’s always important to carefully research mortgage rates to ensure you get the best deal. Mortgages vary in many aspects. One broker could have the lowest rate, but unreasonably high fees. as well as interest rates, you must consider the conditions in the contract and decide if they’re beneficial for you. Every mortgage is different and if you want to find one that suits your needs, you have to explore all possible options.

‘Open’ vs. ‘closed’ mortgages – Which one is best for you?

With an open mortgage, you can choose to pay your balance any time before the term ends, without incurring any penalty. But, you still have to pay a premium. This is ideal if you’re planning to move in the near future, or if you’ll soon receive a large amount of money. A closed mortgage means your premium rate is relatively lower, but the amount of principal you can pay every year is restricted. If you decide to pay off everything before the end of your term, you’ll have to pay a penalty.

Fixed-rate vs. variable rate mortgage

When choosing a mortgage, you’ll need to decide between a fixed or variable rate. With a fixed-rate mortgage, you agree to pay a certain rate over a predetermined time period. The most common term is five years, but you can also opt for a longer or shorter duration. There is a lower risk involved since the rate is not going to change over the course of your mortgage. This also makes it easier to plan your budget because you know how much to set aside. However, fixed-rate mortgages tend to have expensive additional fees. Variable-rate mortgages are more affordable, but riskier. Monthly payments depend on the prime rate. Although you can save more money initially, the price will fluctuate if prime rates change. Volatile rates make it harder to prepare a budget. Read more: Fixed vs Variable Mortgage Rates

Best mortgage rates in Ontario

If you’re looking for the best mortgage rates in Ontario, you’re in the right place. The Financial Forum simplifies your search by instantly giving you a list of the most competitive lenders and banks. Our service is free of charge and gives you the most up-to-date results.