a. Accepting Deposits: of individuals, non-individuals (partnerships, companies, trusts etc.). They pay an interest on your deposits.
b. Lending: They give loans and other credit facilities to individuals & non-individuals for their business/personal requirements.
Financial Institution: There are several types of financial institutions. They are:
a. Banks (Retail & Wholesale)
b. Non-Banking Financial Companies (NBFCs)
c. Insurance companies
d. Pension funds
Credit scores range from 300-900 (you need at least a 680 to qualify for mortgage “A-Lending” as these are CMHC and Genworth’s criteria).
Payment History is worth 35% of your total score. Be sure to make payments on time, the longer past due, the lower the score. Frequency is also a factor, the number of times you are late. This also applies to bankruptcies, liens, mortgages, and judgments.
Amounts Owed is worth 30% of your score. Are you maxed out on all your credit cards? If you don’t want to have this affecting you then be sure to use only 75% of your credit limit. If your limit is $5000 don’t use more than $3750 or it will affect your mortgage credit score.
Length of Credit History is worth 15% of your score. How long have you had your loan/credit card for? Have you been using your credit cards recently prior to getting a mortgage?
New Credit is worth 10% of your score. Make sure you do not apply for credit too often. Newly activated accounts may lower your score. Also, make sure you do NOT have your credit checked too many times when applying for a mortgage. This will lower your score. They want to make sure you are not living beyond your means.
Types of Credit you use are worth 10% of your score. Watch out if you have several credit cards with high limits. This could mean that at anytime you can max these out and have a financial hardship because unlike installment loans, you do not need re-approval to reach the maximum limit. NOTE: If you are the person who likes paying with cash, make sure you use your credit card at least once a month to boost your credit score to get the ideal mortgage rate.
New to Canada – 35%
Salaried/Hourly – 5-20%
Self Employed – 20%
When making 26 bi-weekly payments in one year, an extra monthly payment is made which in turn reduces your principle and shortens your amortization.
This effect can save you thousands in interest and take years off of your mortgage.
Note: Scotia Bank is the only lender that labels their Accelerated Bi-Weekly payments as regular bi-weekly payments, they do not offer a traditional bi-weekly option.
For example let’s say your mortgage balance is $50,000. $50,000/52 *weekly* payments = $961.54
Let’s use the same mortgage balance of $50,000. $50,000/12 *monthly* payments = $4,166.67/4 *for accelerated weekly payments* = $1,041.67.
Therefore you are paying an extra $80.13 a week ($4,166.84 more a year) which will shave down that amortization and principle.