Why You Should Hire a Mortgage Broker

Purchasing a home is one of the financial decisions you'll make in your lifetime. It involves navigating complex financial processes, understanding mortgage options, and ultimately finding the right loan to suit your needs. While you could approach this journey on your own, enlisting the services of a mortgage broker offers several compelling advantages. In this article, we'll explore why hiring a mortgage broker is smart when embarking on your homeownership journey.

Expertise and Industry Knowledge:

Mortgage brokers are professionals with in-depth knowledge of the mortgage industry. They stay up-to-date with the interest rates, and lender policies which allows them to provide valuable insights and guidance tailored to your unique financial situation.

Access to a Wide Range of Lenders:

One of the primary benefits of working with a mortgage broker is their extensive network of lenders. They have access to multiple financial institutions, including banks, credit unions, and private lenders. This means they can shop around to find the most competitive rates and loan options on your behalf.

Personalized Advice:

They use this information to recommend mortgage products that align with your needs. Whether you're a first-time homebuyer, self-employed, or seeking to refinance, a mortgage broker can help you find the right solution.

mortgage broker

Time and Convenience:

Searching for the perfect mortgage can be a time-consuming process. Mortgage brokers streamline this process by doing the legwork for you. They gather the necessary documentation, complete paperwork, and liaise with lenders, saving you valuable time and reducing stress.

Negotiation Skills:

Mortgage brokers are skilled negotiators. They can leverage their relationships with lenders to secure favorable terms and rates on your behalf. This often results in cost savings over the life of your loan.

Unbiased Advice:

Unlike bank loan officers who represent a single institution, mortgage brokers work independently. They don't have a vested interest in promoting a specific lender's products. This independence ensures that the advice they provide is impartial and focused solely on your best interests.

Tailored Solutions:

Every borrower's financial situation is unique. Mortgage brokers recognize this and tailor their recommendations to your specific needs. They consider factors such as your credit score, income, and long-term financial goals to find a mortgage that suits you.

Assistance with Complex Cases:

If you have a less conventional financial situation, such as being self-employed or having a lower credit score, securing a mortgage can be challenging. Mortgage brokers have experience working with a wide range of clients, including those with complex cases. They can help you navigate these challenges and find solutions.


You might assume that hiring a mortgage broker comes with added fees, but in many cases, their services are free for borrowers. They are compensated by the lenders, meaning you can access their expertise at no additional cost.

Peace of Mind:

Perhaps the most significant advantage of working with a mortgage broker is the peace of mind it brings. You can trust that a dedicated professional is guiding you through the mortgage process, ensuring you make informed decisions and secure the best possible loan for your situation.

In conclusion, hiring a mortgage broker is a prudent choice when embarking on your homeownership journey. Their expertise, industry knowledge, and commitment to your best interests can save you time, money, and stress while helping you secure the ideal mortgage for your dream home. When it comes to something as significant as buying a house, enlisting the services of a mortgage broker can make all the difference in your financial well-being.

Looking for Your Dream Home in Burlington? Look no further! Our expert Mortgage Brokers in Burlington are here to help you turn your homeownership dreams into reality.

Applying for a Second Mortgage: Everything You Need To Know

For many Canadians, homeownership is a significant achievement, but it also represents an opportunity for financial flexibility. One way to unlock the value of your home is by obtaining a second mortgage. Whether you are looking to consolidate debt, fund for home renovations, or invest in other opportunities, a second mortgage can be a valuable financial tool.

Let us explore everything you need to know about getting a second mortgage in Canada.

Understanding Second Mortgages

second mortgage

A second mortgage is a loan secured against the equity you have built in your home. It's called a "second" mortgage because it comes in addition to your primary mortgage, which is the initial loan you used to purchase your home.

Why Get a Second Mortgage?

There are various reasons why Canadians consider obtaining a second mortgage:

  1. Debt Consolidation: If you have high-interest debts like credit card balances or personal loans, a second mortgage can be used to consolidate these debts into a single, lower-interest loan. This can save you money on interest payments and simplify your finances.
  2. Home Renovations: Second mortgages are commonly used to finance home improvement projects. Whether it's a kitchen remodel, a new bathroom, or a basement renovation, tapping into your home's equity can fund these upgrades.
  3. Education Expenses: Some homeowners use a second mortgage to cover the cost of their children's education, particularly when other financing options may not be as favorable.
  4. Investment Opportunities: Real estate investments or other income-generating opportunities can be funded through a second mortgage. This allows you to leverage your home equity for potential financial growth.
  5. Emergency Expenses: Unexpected medical bills, emergency repairs, or other urgent financial needs can be addressed by accessing a second mortgage.

How Does a Second Mortgage Work?

Getting a second mortgage involves several key steps:

  1. Equity Assessment: Lenders will assess the current market value of your home and subtract your outstanding mortgage balance to determine the available equity. The amount of equity you have will influence the size of the second mortgage you can obtain.
  2. Loan Terms: You'll need to decide between a home equity loan (where you receive a lump sum) or a HELOC (which provides a revolving line of credit). Loan terms, interest rates, and repayment schedules will also be determined.
  3. Application and Approval: Once you apply for s second mortgage the lender will review your credit history, and other financial factors to check your eligibility and interest rate.
  4. Legal Process: Legal documentation and registration against your property are part of the second mortgage process. These legal steps protect both you and the lender.
  5. Funding: Once approved, you'll receive the funds from your second mortgage. You can then use these funds for your intended purpose.
  6. Repayment: You'll make regular payments on the second mortgage, which will include both principal and interest. The terms of your loan will dictate the repayment schedule.

Interest Rates and Costs

Interest rates for second mortgages can vary depending on factors like your credit score, the loan-to-value ratio, and the lender. Generally, second mortgage interest rates are higher than those for primary mortgages but lower than unsecured loans or credit card rates. Additionally, there may be closing costs, legal fees, and appraisal expenses associated with obtaining a second mortgage.

Managing Risks and Responsibilities

It's crucial to understand that with a second mortgage, your home is used as collateral. This means that if you fail to make the required payments, you risk losing your home through foreclosure. Before obtaining a second mortgage, carefully assess your financial situation, including your ability to meet the repayment terms.

Why Work with a Circle Mortgage

Navigating the complexities of obtaining a second mortgage can be challenging, but you don't have to do it alone. We at Circle Mortgage, can simplifying the process and ensuring you make informed decisions. 

Here's how we can help:

  1. Access to Multiple Lenders: We have access to a vast network of lenders, which allows us to shop around for the best rates and terms on your behalf.
  2. Tailored Solutions: We take the time to understand your financial goals and match you with the lender and services that aligns with your needs.
  3. Expert Guidance: We provide expert advice and guide you through the application process, helping you avoid potential pitfalls.
  4. Time Savings: We handle the paperwork, documentation, and communication with lenders, saving you valuable time and reducing stress and negotiate favorable terms, potentially saving you money.
  5. Ongoing Support: Even after your mortgage is obtained, we can provide ongoing support and advice.


Getting a second mortgage in Canada can be a strategic financial move, offering access to funds for various purposes. However, it's essential to approach it with careful consideration and expert guidance. By working with trusted professionals like Circle Mortgage, you can make informed decisions and leverage the equity in your home to meet your financial goals while minimizing risks.

Everything to Understand about Commercial Mortgages

Commercial mortgages play a crucial role in the Canadian real estate market, facilitating the growth and expansion of businesses across the country. Whether you're a business owner looking to purchase a property or an investor exploring opportunities, understanding Canadian commercial mortgages is essential.

What Is a Commercial Mortgage?

A commercial mortgage is a loan secured by a commercial property, such as an office building, retail space, industrial facility, or multi-unit residential complex. These mortgages are specifically designed for business purposes and differ from residential mortgages in several ways.

Key Distinctions Between Residential and Commercial Mortgages:

  1. Property Type: Commercial mortgages finance income-generating properties, while residential mortgages are for homes where the borrower lives.
  2. Terms and Rates: Commercial mortgages typically have shorter terms (e.g., 5 to 20 years) and higher interest rates compared to residential mortgages.
  3. Loan-to-Value Ratio: The loan-to-value (LTV) ratio for commercial mortgages is often lower than that of residential mortgages, requiring a larger down payment.
  4. Underwriting Criteria: Commercial mortgage approvals consider factors like property income, business financials, and the borrower's creditworthiness.

Types of Canadian Commercial Mortgages:

  1. Owner-Occupied Mortgages: Business owners purchase properties to operate their businesses. These mortgages enable them to acquire a location for their operations while building equity.
  2. Investment Mortgages: Investors buy commercial properties to generate rental income and capital appreciation. These mortgages help finance real estate investments.
  3. Construction Loans: These loans fund the construction of new commercial properties or significant renovations and typically convert into permanent mortgages once the project is complete.

Factors Influencing Commercial Mortgage Approval:

  1. Property Income: Lenders assess the property's income potential and its ability to cover mortgage payments.
  2. Business Financials: For owner-occupied mortgages, the financial health of the business plays a significant role in the approval process.
  3. Creditworthiness: Borrowers' personal and business credit histories are evaluated.
  4. Down Payment: Lenders typically require a down payment ranging from 15% to 35% of the property's purchase price.

Interest Rates and Terms:

Interest rates for Canadian commercial mortgages can be fixed or variable and are influenced by market conditions, the borrower's creditworthiness, and the property's income potential. Terms vary but commonly range from 5 to 20 years, with amortization periods of up to 25 years.

Loan-to-Value Ratio (LTV):

Lenders assess the property's value and the borrower's creditworthiness to determine the maximum LTV ratio. Commercial mortgages often require an LTV ratio of 65% to 80%, meaning borrowers must provide a substantial down payment.

Prepayment Penalties:

Commercial mortgages may include prepayment penalties if borrowers pay off the loan before the term ends. These penalties vary and should be carefully considered when selecting a mortgage.

Choosing the Right Commercial Mortgage:

Selecting the most suitable commercial mortgage involves evaluating your specific needs, property type, financial situation, and long-term goals. It's essential to work closely with a knowledgeable mortgage broker or lender who can guide you through the process.


Commercial mortgages Burlington are essential financial tools that facilitate business growth and real estate investments. Understanding the nuances of these mortgages, including their types, approval factors, interest rates, and terms, is vital for making informed decisions. Whether you're an entrepreneur looking to expand your business or an investor seeking income-generating properties, Canadian commercial mortgages offer opportunities to achieve your objectives in the dynamic Canadian real estate market.

Is a home equity line of credit right for you?

For many homeowners, the equity they have built in their homes represents a valuable financial asset. It's a testament to their investment and responsible financial management. But did you know that you can leverage this equity to achieve various financial goals? One way to do so is by considering a Home Equity Line of Credit, commonly known as a HELOC. 

In this article, we will explore what a HELOC is, how it works, and whether it might be the right financial tool for you.

Understanding the Basics of a HELOC

A Home Equity Line of Credit (HELOC) is a type of revolving credit that allows homeowners to borrow against the equity in their homes. Equity, in this context, is the difference between the current market value of your home and the outstanding balance on your mortgage.

HELOCs are considered "revolving" because, similar to a credit card, they provide a maximum credit limit, but you only borrow and pay interest on the amount you use. This flexibility makes HELOCs a versatile financial tool for various purposes.

Is a HELOC Right for You?

Determining whether a HELOC is suitable for your financial needs requires careful consideration of your goals, financial situation, and risk tolerance.

Here are some factors to weigh when deciding if a HELOC is right for you:

1. Financial Goals:

2. Financial Situation:

3. Risk Tolerance:

4. Repayment Plan:

5. Responsible Use:

6. Alternatives:

7. Consultation:

In Conclusion

A Home Equity Line of Credit (HELOC) can be a valuable financial tool when used wisely. It offers flexibility, competitive interest rates, and the ability to access funds for various purposes. However, it's crucial to evaluate your financial goals, situation, and risk tolerance before pursuing a HELOC. 

Circle Mortgage can provide you with the insights and guidance needed to make an informed decision. A HELOC might be the right choice to help you achieve your financial aspirations, but it's essential to do your due diligence and consider all factors carefully.

Mortgage Stress Test Canada

New Canadian Mortgage Stress Test Rules Introduced To Cool Overheated Housing Market

The housing market has experienced an unprecedented and unexpected boom amid the COVID-19 pandemic. There have been countless stories of how first-time home buyers and young hopefuls are being priced out of the market, and even many industry professionals from Canada's big banks have recognized the unusual overheating. Over the last few months, there have been calls for the Canadian federal government and the Bank Of Canada to intervene and implement measures to effectively cool the market.

As of June 1 st 2021, the new Canadian mortgage stress test rules took effect. This means that the minimum qualifying rate for a mortgage has changed from the previous 4.79% to 5.25%. This new qualifying interest rate has reduced the purchasing power of most borrowers by 3 to 5%. It essentially reduces the amount people will be able to spend as a maximum on their mortgage.

But does the new mortgage stress test solve the problem of Canada's increasingly unsustainable housing market? And will the stress test rate help to calm the market enough that.

How The Stress Test Impacts Mortgage Payments

Let's take a closer look at how the new stress test works and who it impacts. If you want to see how it impacts you directly, try our comprehensive mortgage calculator.

The new Canada mortgage stress test will affect Canadian home buys who are applying for a new mortgage or renewing an existing one. Stress testing at these new interest rates will sooner impact those with a variable rate mortgage, as opposed to those with a fixed-rate mortgage.

The Canada qualifying rate for uninsured mortgages, where the down payment is 20% or more, is now either two percentage points above the contracted rate, or 5.25%, whichever is higher. As of right now, this does not apply to insured mortgages.

As an example, effective June 1st, a family with an annual income of $150,000, with property taxes of $4500, will see their maximum amount for an amortization period of 25 years fall from $772,000 to $738,000.

The fact of the matter is that these new mortgage rules and stress tests alone will not do much to reduce housing costs in Canada.

Majority Of Home Buyers Are No Match For These Bidding Wars

One of the biggest issues that plague the market conditions today is the lack of transparency in the offer process. Many hopeful buyers have lost out on their dream homes in blind bidding wars, while others have taken on a substantial and risky amount of debt payments in order to get into the market.

The supply side of real estate is definitely another issue, but cannot be solved as quickly as the implementation of regulations surrounding offers. By putting these types of rules in place, housing would increase at a more gradual pace as opposed to this rapid growth we have experienced over the last year.

When potential home buyers are looking to make an offer on a home, a real estate agent will often tell them to put their maximum willingness forward. Conditions and clauses would previously protect the buyer, such as a home inspection or a few days to explore their mortgage options. Now, those standards have completely gone out the window.

Many people are finding it increasingly difficult to compete when sellers are entertaining multiple cash offers with no conditions. Offers of this nature are subject to a fair amount of risk and other debt payments down the line - but it is slowly becoming the new standard of the market.

Did you know that when mortgage lenders, whether that's financial institutions or private lenders, lend on the appraised value or the sale price of a home, whichever is lower? So essentially, if a buyer makes an offer well over asking, and the value is not supported, they will have to make up the difference of the purchase price in CASH.

And while there is the potential of borrowing enough money from unsecured sources, such as credit unions, any type of unsecured home loan can throw your entire scenario offside and put you into dangerous financial strain.

Transparency Needs To Be Implemented In The Offer Process. The Stress Test Is Not Enough.

While the mortgage stress test will undoubtedly remove some buyers from the market, it seems like those who are greatly impacted will be first-time home buyers. Many of these individuals have spent years saving for a down payment and are eligible for the lowest mortgage rates, but they will continue to be isolated from the housing market due to the blind bidding wars. The stress test doesn't help.

Now imagine the Bank of Canada were to work with Canada's Realtor Association to change the process from blind to transparent. What would happen, first and foremost, is that the large gaps between offer amounts would shrink immediately as buyers would no longer have to wonder or blindly guess what a competing offer may contain. Instead, they can simply view a spreadsheet that is updated as offers are registered. This way, when you put your best foot forward, you can see everyone else's shoes.

A transparent process also eliminates offers that are far off from being successful. If the registered offer values are above the maximum you are willing to spend, you will save yourself from the mental angst of waiting to see if your home dreams can come true.
Becoming a homeowner is arguably one of the top milestones in one's life. Throughout this latest housing boom, many people are so tired of losing out on the offer process that they one day wake up and say "screw it, out all the chips in".

Here is a multiple offer scenario of three offers: The home was a detached property in North Burlington. Offer 1 was $5000 below asking, Offer 2 was at full price. Offer 3 was $80 000 over the asking price. While Offer 3 will never know what #1 and #2 looked like, they overpaid. To the tune of $79 000 or about an additional monthly payment of $300 for 25 years. Multiply that by the number of multiple offer scenarios and you'll begin to see the problem.

Is Canadian House Pricing Putting A Strain On Our Quality of Living?

It has recently been argued that the unsustainable growth in hosting prices could directly impact our quality of life. Household income has not increased at the rate of housing, and in order to afford a monthly mortgage payment, many are allocating the majority of their monthly income towards homeownership. This doesn't leave much room in the monthly budget for student loans, car payments or any other type of unexpected expense.

Panic Buying And Speculation Are Fueling The Housing Market - Not The Mortgage Rates

Prior to the June 1st enactment of the new rules, the mortgage industry saw a huge amount of panic buying. As a mortgage broker wanting to help mortgage applicants get secure the best interest rates, I am also aware of how interest rates are only one part of the equation.

Changing the qualifying rate of mortgages will only reduce these winds from 1000km/h to 950km/h. We shouldn't be making it more difficult to secure a mortgage loan or maintain the current mortgage with a financial institution - instead, it is time for our Government to work with Canada's Realtor Associations to fix the offer process.

In scenarios where supply and demand were closer to equal, an intervention was not needed. It is past time we explore a solution that doesn't make a mortgage impossible to maintain.

Circle Mortgage Is Here To Help

If you are a first-time home buyer and looking for a competitive mortgage rate, contact Circle Mortgage Group today. Our team would be more than happy to help you explore your options.

Toronto index stopped trending down in January

In January the Teranet–National Bank National Composite House Price IndexTM rose 0.3% from the previous month, a tic higher than the historical average for January and a second consecutive monthly increase. However, only four of the 11 metropolitan markets surveyed showed gains – the first time since January 2016 that a rise in the Composite Index has had so little breadth. It was due mainly to a second straight monthly jump of the index for the important Vancouver market (1.2% in January on the heels of 1.3% in December). The Toronto index rose 0.2%, the Victoria index 1.0% and the Montreal index edged up 0.1%. All the other component indexes were down on the month: Hamilton (−0.2%), Ottawa-Gatineau ( 0.2%), Edmonton (−0.3%), Calgary (−0.3%), Halifax (-1.0%), Winnipeg (−1.1%) and Quebec City (−2.0%). For Montreal, it was a 13th monthly increase, and for Hamilton it was a fifth decrease in a row. The rise of the Toronto index was the first in six months. The raw (unsmoothed) Toronto index [1] on which it is based was up for a third consecutive month. The firming of the smoothed index is due entirely to condo dwellings. The smoothed index for non-condo units fell in January for a sixth straight month, bringing its cumulative decline to 9.6%.
Click here for full release. https://housepriceindex.ca/2018/02/toronto-index-stopped-trending-down-in-january/

2018 CMHC Prospective Home Buyers Survey

In October 2017, CMHC surveyed 2,507 prospective home buyers on-line. Respondents were all prime household decision-makers who intend to purchase a new home within the next two years, including approximately 1,500 First-Time Buyers, 500 current owners, and 500 previous owners.
The survey results highlight that:
• First-Time Buyers and Previous Owners share the same top motivator to purchase a home: they want to stop renting. Improved accessibility (physical obstacles and barriers) and investment opportunity were also noted as top motivators across all groups. Changes to mortgage regulations and concerns about possible future interest rate increases were not among the top motivators.
• Over four-in-ten First-Time Buyers and Previous Owners say they would delay their home purchase if they were not able to find their ideal home, with a fairly similar proportion saying they would be willing to compromise on the size of the home and location.
• The majority of future home buyers intend to obtain a mortgage to finance their home purchase, with First-Time Buyers showing higher incidence compared to Previous Owners and Current Owners.
• Across all future home buyers groups, more than six-in-ten say they are likely to have a financial buffer in case their expenses change in the future. Furthermore, the majority of future home buyers, especially Current Owners, agree that they feel confident they have the necessary tools and information to manage their mortgage and debt load.
• Among all groups, the two most common actions completed one to two years prior to the purchase of a home were saving for a down payment and determining what type of home to buy. On the other hand, in the last three months before purchasing, about two-in ten of prospective buyers pre-qualify for a mortgage.
• About one-in-four prospective home buyers stated that they would be very likely to consider delaying their purchase in the event of an increase in interest rates.

Vancouver the main driver of the Composite in December

Vancouver the main driver of the Composite in December says Teranet and National Bank of Canada
Without Vancouver, the Composite index would have declined for a fourth month in a row. The strength of Vancouver’s index is consistent with continued tight home resale market conditions. Toronto’s index declined for a fifth consecutive month, but the unsmoothed index (see note on methodology on next page) rose for a second month in a row (middle chart). Unless the unsmoothed index relapses in January, the sequence of declines in the smoothed index should then be interrupted. However this improvement is likely to prove temporary, as it might have resulted from buyers rushing to avoid the new bylaws on qualification for an uninsured mortgage (implemented in January 2018). This view is supported by the increase in Toronto home sales in November and December compared to previous months (bottom chart). Therefore, a resumption of the downward price trend early this year cannot be excluded.
Please click on the link below to access the full report:
201712 TNB monthly commentary

Bank of Canada increases overnight rate target to 1 1/4 per cent

The Bank of Canada today increased its target for the overnight rate to 1 1/4 per cent. The Bank Rate is correspondingly 1 1/2 per cent and the deposit rate is 1 per cent. Recent data have been strong, inflation is close to target, and the economy is operating roughly at capacity. However, uncertainty surrounding the future of the North American Free Trade Agreement (NAFTA) is clouding the economic outlook.
The global economy continues to strengthen, with growth expected to average 3 1/2 per cent over the projection horizon. Growth in advanced economies is projected to be stronger than in the Bank’s October Monetary Policy Report(MPR). In particular, there are signs of increasing momentum in the US economy, which will be boosted further by recent tax changes. Global commodity prices are higher, although the benefits to Canada are being diluted by wider spreads between benchmark world and Canadian oil prices.
In Canada, real GDP growth is expected to slow to 2.2 per cent in 2018 and 1.6 per cent in 2019, following an estimated 3.0 per cent in 2017. Growth is expected to remain above potential through the first quarter of 2018 and then slow to a rate close to potential for the rest of the projection horizon.

Fourth Quarter Housing Market Trends Seal 2017 as ‘the Year of the Condo’

According to the Royal LePage House Price Survey, Canada’s residential real estate market saw strong, but slowing year-over-year price growth in the fourth quarter of 2017. While year-over-year aggregate appreciation remained high in the Greater Toronto Area (GTA) and Greater Vancouver, two-storey and bungalow home values softened in the GTA, slightly declining on a quarter-over-quarter basis. Meanwhile, in both Greater Vancouver and the GTA, condominium prices continued to outpace all other property types, primarily due to growing affordability constraints within these markets.
The Royal LePage National House Price Composite, compiled from proprietary property data in 53 of the nation’s largest real estate markets, showed that the price of a home in Canada increased 10.8 per cent year-over-year to $626,042 in the fourth quarter of 2017. When broken out by housing type, the median price of a two-storey home rose 11.1 per cent year-over-year to $741,924, and the median price of a bungalow climbed 7.1 per cent to $522,963.
During the same period, the median price of a condominium appreciated faster than any other housing type studied, rising 14.3 per cent to $420,823 on a year-over-year basis. This trend was predominantly driven by the significant price gains witnessed in many of the country’s largest condominium markets. In the GTA, the median price of a condominium increased 19.5 per cent year-over-year to $476,421, while in the City of Toronto, the segment saw a similar gain of 19.6 per cent year-over-year to $515,578. In Greater Vancouver, condominiums also followed a similar price trajectory during the quarter, rising 20.2 per cent to $651,885, while the median price of a condominium unit in the City of Vancouver rose 18.7 per cent to $775,806. Many suburban markets across the GTA and Lower Mainland of British Columbia posted strong year-over-year condominium price gains of 20 per cent or more as well, with the segment appreciating at a faster rate than detached homes, which had previously led the charge.
“To prospective homeowners in our largest cities, condominiums represent the last bastion of affordability,” said Phil Soper, president and CEO, Royal LePage. “This is especially true for first-time buyers whose purchasing power has been reduced by tightening mortgage regulations.” Click here for more.