Buying a home is one of the most significant financial decisions you will ever make. Whether you are a first-time homebuyer, refinancing your existing mortgage, or preparing to renew your loan, choosing the right mortgage professional is just as important as selecting the right home.
A knowledgeable mortgage broker or lender can help you secure the best rate, avoid costly mistakes, and structure a mortgage that fits your long-term financial goals.
However, not all mortgage providers offer the same level of transparency, expertise, or service. That is why asking the right questions is crucial. The better the questions you ask, the better your chances of finding the perfect mortgage solution.
1. What Mortgage Options Do You Offer?
Not all mortgages are the same. Before choosing a product, you need to understand the full range of options available to you.
A reliable broker or lender should be able to explain the difference between clearly:
- Fixed-rate mortgages
- Variable or adjustable-rate mortgages
- Open vs. closed mortgage terms
- Conventional vs. high-ratio mortgages
- HELOCs (Home Equity Lines of Credit)
- Specialty products for self-employed borrowers
By asking this question, you’ll learn whether the professional is offering a wide selection of lenders and products—or simply steering you toward a single solution.
2. What Interest Rate Can I Qualify For?
Interest rates affect your monthly payment and total borrowing cost, so this is one of the most important questions you can ask.
A reputable mortgage professional will consider:
- Your credit score
- Your income and employment situation
- Your down payment
- Your existing debt
- The mortgage stress test
- The type and term of the mortgage
Be cautious if someone offers a rate that sounds too good to be true. Ask how long the rate is guaranteed and whether it may change before closing.
3. What Factors Could Affect My Rate Before Closing?
Many buyers are surprised when their rate changes just before their mortgage closes.
Common factors include:
- A change in credit score
- New debt added during the approval process
- Income verification issues
- Market rate fluctuations
- Expiry of a rate hold
By asking this question early, you’ll understand how to protect your approval and avoid last-minute surprises.
4. What Will My Monthly Payments Be?
Your monthly payment doesn’t just depend on the mortgage amount. It’s also shaped by:
- Your interest rate
- Amortization period
- Payment frequency (monthly, biweekly, accelerated)
- Whether you pay taxes and insurance through your lender
A mortgage broker should provide an accurate breakdown of your monthly costs, including the impact of selecting accelerated biweekly payments (which can shave years off your mortgage).
5. What Are the Total Closing Costs?
Many Canadian homebuyers overlook closing costs until the end—and are shocked when they add up.
Closing costs may include:
- Land transfer tax
- Legal fees
- Appraisal fees
- Home inspection
- Title insurance
- Mortgage default insurance (if down payment < 20%)
- Rate-lock fees
- Administrative or broker fees
Asking this early helps you set aside the correct budget and avoid dipping into your emergency savings.
6. What Is the Total Cost of the Mortgage Over Time?
Interest rates are important, but your long-term financial cost matters even more.
Ask your mortgage broker to calculate:
- Total interest you’ll pay over the entire amortization
- The difference between a 25-year and vs. 30-year amortization
- How much do you save with accelerated biweekly payments
- How rate changes affect total cost
This allows you to choose a mortgage that supports—not sabotages—your financial goals.
7. What Prepayment Options Do I Have?
Prepayment privileges determine how quickly you can pay off your mortgage.
Typical prepayment options include:
- Lump-sum payments
- Increasing your monthly or biweekly payment
- Doubling your payments
- Anniversary prepayment privileges
Some lenders offer more flexibility than others. A strong prepayment program can help you pay off your mortgage years earlier and save thousands in interest.
8. Is There a Penalty for Paying Off My Mortgage Early?
Not knowing your mortgage penalty could cost you thousands—especially if:
- You decide to sell your home
- You refinance to access equity
- You want to renegotiate your rate
- You need to break your term early
Penalties vary based on the lender and mortgage type:
- Fixed-rate mortgages often use an Interest Rate Differential (IRD) calculation.
- Variable-rate mortgages typically charge interest for three months.
Understanding penalties can help you choose the right product and avoid unexpected costs if your life plans change.
9. Does This Mortgage Come With Any Restrictions?
Some of the lowest advertised rates come with strict limitations.
Common restrictions include:
- Limited prepayment privileges
- No ability to switch lenders without penalties
- Mandatory mortgage insurance
- Higher penalties for breaking the mortgage
- Limited refinancing options
Asking this question helps you avoid “low-rate traps” that cost more in the long run.
10. Can You Walk Me Through the Mortgage Stress Test?
In Canada, all borrowers must pass the mortgage stress test—even if they are putting down more than 20%.
The stress test applies the higher of:
- The Bank of Canada’s qualifying rate, or
- Your contract rate + 2%
A good mortgage broker should help you understand:
- How the test affects your borrowing power
- What you can do to improve your chances of qualifying
- Whether adjusting your mortgage term or type can help
This one question can prevent buying a home you can’t honestly afford.
11. Which Documents Do I Need for Approval?
Your approval depends on providing the proper documents on time.
Typically required documents include:
- Government ID
- Recent pay stubs
- Employment letters
- T4 slips or NOAs
- Bank statements
- Proof of down payment
- Credit report
- Tax returns (for self-employed borrowers)
Asking for this list early ensures a smooth approval and avoids delays.
12. Are You Charging Any Broker or Lender Fees?
Some mortgage brokers charge:
- Origination fees
- Processing fees
- Rate-lock fees
- Administration fees
Many brokers are paid directly by the lender, not the borrower. But that’s not always the case—especially for private or alternative mortgages.
13. What Is the Difference Between Going With a Broker vs. a Bank?
Ask them to explain:
- How many lenders do they work with
- Whether they have access to special promotions
- How they compare lenders on your behalf
- Whether they earn commission and how that affects recommendations
This helps you ensure you are getting the best possible mortgage product—not the one that pays the highest commission.
14. Will You Help Me After My Mortgage Closes?
Many borrowers need guidance even after closing—for renewals, refinancing, changing payment frequency, or accessing home equity.
Ask your broker or lender what support they provide after the mortgage is finalized, including:
- Rate monitoring
- Renewal reminders
- Refinance assessments
- Annual mortgage checkups
A good mortgage professional doesn’t disappear after closing.
15. Can You Explain the Mortgage Term Options?
Mortgage terms in Canada typically range from 1 to 10 years, with 5-year terms being the most common.
Ask your broker to explain:
- Benefits of shorter vs. longer terms
- How terms affect rate stability
- Renewal strategies
- Penalties associated with breaking the term
Choosing the correct term can protect you from market volatility and save you money.
16. What Down Payment Do I Need?
Your down payment affects:
- Whether you need mortgage default insurance
- Your total loan amount
- Your interest rate
- Your monthly payments
In Canada:
- Minimum down payment is 5% on homes up to $500,000
- 10% on the amount between $500,000 and $999,999
- 20% for homes $1 million+
Your broker should help you explore programs that make buying easier, such as:
- First-Time Home Buyer Incentive
- RRSP Home Buyers’ Plan (HBP)
- Provincial grants and rebates
17. How Long Will Approval Take?
Ask for a realistic timeline based on:
- Your financial profile
- The lender involved
- Market conditions
- Required documentation
This helps you plan your closing date and avoid unnecessary stress.
18. Can You Provide a Written Mortgage Estimate?
Always ask for mortgage details in writing, including:
- Interest rate
- Payment amount
- Fees
- Term length
- Amortization schedule
- Prepayment options
- Penalty structure
Keep this document for your records—it’s your protection in case of discrepancies.
Final Thoughts: The Right Questions Lead to the Right Mortgage
Asking the right questions helps you avoid costly mistakes, understand your mortgage terms, and secure the best financing option for your situation. Whether you are working with a broker or a lender, transparency and clear communication are essential.
With this list of questions, you will be prepared, confident, and empowered during the mortgage process—ensuring you choose a mortgage that supports your financial goals for years to come.
