Question

Different banks sell insured mortgages (5% to 20% down payment) differently. You are currently working with Noura to advise her regarding a $500,000 mortgage for her first-time home purchase.

She is a single, never-married individual with a $100,000 annual income.
She has had a stable job with the Federal government for more than 20 years.
She can come up with a down payment of $100,000 to 130,000 if it is required.
Noura is looking for some recommendations from you, the mortgage specialist, who has access to all major banks such as TD, BMO, CIBC, RBC and Scotiabank in Canada.
Noura is seeking your advice on the best-suited mortgage option for her first home purchase and she is really excited to meet with you. As a successful mortgage specialist, you know that you will have to prepare some sales dialogues along with the presentation that allows you to guide her through her decision-making process.
To do this, you have chosen to research and review a minimum of TWO different bank websites. For each bank, you want to look at the following information for comparison and presentation purposes:
· The mortgage rates (1-, 3-, and 5-year terms)
· The benefits and features of different types of mortgages.
· The way the bank presents its mortgage products to the general public.
· What information do the banks present to create a better understanding of mortgages in general?
a. Rules
b. Fixed vs. variable rates
c. Open. vs. closed mortgage
d. Terms
e. Amortization periods
f. Down payment calculators
g. Mortgage payment calculators

Answer 1

To advise Noura, it's essential to compare the mortgage rates, terms, benefits, and features from different Canadian banks. A sizeable down payment eliminates the need for mortgage insurance. Tools like payment calculators help in assessing financial commitments.

Step-by-step explanation:

When advising Noura on the best-suited mortgage option for her first home purchase, it is important to consider various aspects that banks in Canada offer for their mortgages. With her capability to provide a down payment between $100,000 to $130,000 on a $500,000 property, she can avoid the additional cost of mortgage insurance required for down payments less than 20%. However, understanding the current mortgage rates for 1-, 3-, and 5-year terms, the general rules of mortgages, and the differences between fixed vs. variable rates, open vs. closed mortgages, and various terms and amortization periods is crucial to make an informed decision. Additionally, using online down payment and mortgage payment calculators provided by the banks can help Noura visualize her financial commitments over the life of the mortgage.

Given Noura's strong financial position and stable job, she may prefer a mortgage with a lower interest rate and benefits such as the ability to make prepayments or having a flexible payment schedule. Comparing the offerings from major banks like TD, BMO, CIBC, RBC, and Scotiabank will provide Noura with a range of suitable options. The aim is to select a mortgage that complements her financial goals and provides long-term security.