We’re at 2011 right now and it wasn’t that long ago that you were able to get a 40 year amortization. Then it got cut down to 35 years. From there it’s now being cut down to 30 years, but I still get the question all the time, “Can I get higher than a 30 year amortization? I heard a rumour that I can.” The quick answer to this is yes, it is possible to get a higher than 30 year amortization for a mortgage, but the other part to that is it is not available at every lender. There is some government law that you need to understand first before you start asking for exceptions like that.
Now the first thing to lay out is that the government has set a mandate that if you put less than 20 percent down on the purchase of your property, or if you have less than 20 percent down in your home if you’re refinancing, you must have a cap of 30 years for an amortization. You cannot go any higher than that. That’s simply to safeguard you so that we don’t have any kind of economic collapses again, like we just experienced. Because of that 30 years is your maximum. No ifs, ands or butts. You can’t pay anyone off. You can’t talk to a friend and get a good deal. 30 years is your max because it’s a government set law. OK?
Now, that said, if you are putting more than 20 percent down, and if you go to one of the very few lenders out there who are still offering this, you can still get 35 years. In fact there’s still maybe one or two lenders that will still let you do 40 year amortization. Depending on the size of the property that you’re getting or trying to afford, you may need that extra amortization. But, if you’re going to buy something, not much, you must put at least 20 percent down payment.
So, that’s it. If you’re looking to buy a house at less than 20 percent down, which most of you are, don’t even ask about amortization; you are capped at 30 years. OK? But if you’re putting more than 20 percent down exceptions can be made, but chances are your bank won’t be able to do it for you. There are just, truly, one to two lenders out there we’ll say three or four lenders that will let you go to 35 years, and then one or two that will let you do 40 years. To try and fish them out yourself is going to be really difficult, so I do recommend going to a broker or coming to me.
If you have any questions about amortization let me know. Leah Cross with the Mortgage Centre. Don’t forget to subscribe that way you won’t miss any videos. As well, leave a comment down below. Email or call me if you have any questions. Other than that give a thumbs up if you like the video and it was helpful to you. I guess that’s it for now. Good luck with the amortization and I will talk to you later.
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