New Home Buyer? Mortgage Basics.

Purchasing a home can be one of the biggest investment decisions we make in our lives. It is important to understand how mortgages work since we don't usually pay all the money upfront to purchase a home.

Depending on the type of mortgage you choose (fixed vs. variable, open vs. closed) you can save tons on interest over the life of the mortgage.

One tip is to increase the frequency of your mortgage payments. Instead of paying once a month, choose a bi-weekly payment plan. You cut the payment that you would regularly pay in a month into half and pay it every two weeks. Since there are 52 weeks in a year you actually end up making 13 mortgage payments in a year instead of 12. That extra payment cuts down the amount you pay in interest over the life of the loan dramatically and will allow you to own your home mortgage free years sooner.

With little to no change in your life style you can shave off $1000's in interest. For more on mortgage basics check out this video:

Got a Mortgage? Shop Around!

When we go out shopping we often try to get the best deal, whether it's by clipping coupons or checking the weekly flyer. The same goes for mortgages, only in this case we're shopping for the best interest rate. It's always a good idea to get at least two to three different rates from different banks. Knowing who can offer the lowest rate is an excellent bargaining chip when negotiating for the best rate.

To find the most competitive mortgage rates in Canada go to Ratehub: http://www.ratehub.ca/

This is an excellent site that has the most up to date Canadian mortgage rates. It also has some cool calculators that help you find out how much house you can afford and what the payments would be like.

Don't forget that the bank is in business to lend money. You can always take your business elsewhere. Shopping around and paying the best rate will help you become mortgage free years ahead!

Here's a video with some tips on how to negotiate the best mortgage rate: