of mortgages & men

Hugo Boss preppy. Post-yoga Zen. Tall, dark and dangerous. Just as there's a suitable partner for luckycat girls of all romantic stripes, there’s a mortgage for luckycat girls of all financial stripes as well.

Basic mortgage types that luckycat girls need to know:

Closed. For the girl who craves security.
You promise to keep the mortgage for a set number of years. The lender promises a fixed interest rate for that same amount of time. But pay out your mortgage early and you may need to pay a penalty. Feeling trapped? Many closed mortgages have pre-payment options that allow you to pay down the debt more quickly. In some cases, you can pay off 10-20% of the mortgage principal each year without penalty.

Open. For the commitment-phobe.
You can prepay at any time, without penalty. Open mortgages typically have a higher, guaranteed interest rate, often for a 6 month or 1 year term.

Convertible. For the girl who wants to have her cake and eat it too.
A convertible mortgage allows you to play the short term market, but lets you lock in to a longer term once you feel that interest rates are going to go up. But careful the icing! Some convertible mortgages restrict the term you can convert to. And while you can switch to a longer term without penalty, you’re not guaranteed the lowest rate.

Cash Back. For the girl seeking instant gratification.
You get 3-5% of the original mortgage balance in cash, on the day of funding the mortgage. Just bear in mind that you’ll likely be paying the bank’s posted rate, not a lower one that you otherwise could have negotiated.

Secured Line of Credit. For the girl willing to put out.
This loan option remains fully open for pay down without penalty. But you’ll need to put out and pay the prime rate. And you’ll be restricted to a maximum loan amount of 75% of the purchase price or appraised value.

Variable Rate. For the girl up for a ride.
These mortgages fluctuate with the bank's prime rate. Some variable rate products will actually be locked in for 3 years and the interest rate will change daily or monthly. Others will fluctuate every 3 months. Variable rate mortgages are best in times where interest rates are stable to declining. But while they’ve been increasingly popular in the last few years, it’s hard to measure one product against the next. Talk to an expert for more information.

Consult your lender or mortgage broker to discuss these and other options before making your mortgage move. And visit luckycatrealestate.com for more on real estate in Greater Vancouver.