Clinton meets up with Ana Almeida from CTV to talk about how a pre-approval is…
Home Trust Mortgage in the News:
What Happens if Your Mortgage Lender Stops Lending?
Not to scare everyone and sound doom and gloom but if you have not heard, Home Trust company is having some financial issues. This can create challenges if you have a home trust mortgage. This translates into a future for them where they may or may not be sold or stop lending under their existing name. This is not the first time we have seen a mortgage lender be in this situation and exit the Canadian marketplace. In the past, mortgage lenders have merged, changed names, and closed their doors. Home Trust will not be the first and they will not be the last to be in this situation.
What happens to the clients who have a home trust mortgage or with a lender who is no longer lending?
If your mortgage lender goes bankrupt, you still have to pay your mortgage. They will likely sell your mortgage to another lender.
Will They Call My Mortgage and It’ll be Due?
If you have an insured mortgage it will most likely be assigned to another lender. This lender will offer you a mortgage renewal and you can just continue. Alternatively, you can switch lenders when the mortgage comes up for renewal as long as you can still qualify. In most cases, your mortgage terms will not change.
Will I Lose My Home if the Lender Goes out of Business?
If you have an alternative mortgage, you may be required to requalify or payout your existing mortgage to another lender. In these cases, they may want to exit the type of product you have. It is very common for lenders to offer a shorter-term renewal for those who cannot get a new mortgage and the rate could be higher. In the case of Home Trust, the bulk of their mortgage business is this type of alternative mortgage business.
It can be a scary time and we understand that. We are here to help! Don’t fear the worst. The best thing to do is to see a mortgage broker and discuss your options when your mortgage comes up for renewal. Feel free to contact us, if you have any questions!