Mortgages

 


 

We offer a number of flexible and convenient options to assist you with your mortgage financing needs. Whether you are looking to purchase your first home, working towards a debt consolidation or needing some funds to complete home renovations we have many great options available.
 
Product Facts

All of our closed mortgage term loans offer flexible “15/15” prepayment options to help you pay off the mortgage faster.

Weekly, biweekly, semi-monthly and monthly payment options are available for our fixed term mortgages.

Interest only minimum payments are available for our mortgage line of credit product, which is also known as a “Primeline”.

VPCU offers fixed and variable mortgage rates. Our variable rates are based on the VPCU Prime Lending Rate.

We offer mortgage term loans ranging from one to five year terms in length. Amortization lengths can be up to 25 years.

Affordable payment protection is available.
 
Questions & Answers
 
1. Is it possible to get a better rate than the posted rate?
Yes it is! At VPCU we have a relationship pricing model in place. That means the more business you have with us, the better the rate you will get. If you bring over your direct payroll deposit, use our Visa card, setup an RRSP investment account or have other lending products with us, we will take that all into consideration and offer a better rate accordingly. Relationship pricing is offered for new and existing mortgages as well as for mortgages that are up for renewal. Please contact us at loans@vpcu.com for more details.
 
2. I have a current mortgage with VPCU and I am looking to “upsize” and purchase a bigger residence and need a larger mortgage, but my current mortgage does not come due to renew for another two years. What are my options?
We would look at a “Blend & Extend” of your mortgage rate. This option “blends” your current rate with the new rate and “extends” the term of your current mortgage with the term of your choice. In addition, your new term must be of equal or greater length than the existing term. This option is the best of both worlds. You avoid paying a mortgage penalty and your mortgage rate is somewhere between the rate you are currently paying and the current posted mortgage rate. Please contact our lending department at loans@vpcu.com for full details. 
 
3. What is a debt consolidation loan?
A debt consolidation loan is a loan that re-organizes all or a significant portion of your outstanding debt into one focused loan and loan payment. When you complete a debt consolidation through a mortgage you will save a great deal in interest as mortgage rates are much lower than unsecured loan rates and credit card rates.
 
4. VPCU has the 15/15 mortgage pre-payment options attached to the fixed term mortgage products. Could you please explain how that works?
Members are permitted to increase mortgage payments by 15% and are also permitted to make up to a 15% lump sum payment based on their original mortgage balance per mortgage year. To illustrate how this works, please refer to the example below.

Example: Member received a new mortgage of $100,000 on February 1, 2017. They currently pay $1000/month. Their mortgage year runs from February 1, 2017 to January 31, 2018.

Between February 1, 2017 to January 31, 2018 this member may use one or both of these options:
 
  1. Lump Sum Payment – This member may make a lump sum payment of up to $15,000 (15% * $100,000). This lump sum payment may be split up into a few portions, but the total amount during this period cannot exceed $15,000. On February 1, 2018, the member’s lump sum payment option resets and they are allowed to make another $15,000 lump sum during the next mortgage year running from February 1, 2018 to January 31, 2019. Please note that if a member does not use their lump sum option during the mortgage year, this option is not carried forward.
 
  1. Payment Increase – This member may increase their monthly payment to a maximum of $1150 ($1000 + 15%). On February 1, 2018, they will be eligible for another payment increase by up to 15%. In other words, they can increase their monthly mortgage payment from to $1323 ($1150 + 15%). Please note that if a member does not use their payment increase option during the mortgage year, this option is not carried forward.
 
5. Other banks and credit unions charge hundreds of dollars just to process mortgage applications these days. Does the same apply to VPCU?
No. VPCU does not charge any loan application processing fees.
 
6. What are the other fees I should be aware of when applying for a mortgage?
Depending on the type of mortgage some or all of the fees listed below may apply:

Appraisal fee – Depending on the value of the mortgage you are trying to obtain we may require a condensed online appraisal report or a full appraisal report where an inspector views your property in person.

Legal fees – Some existing mortgages and all new mortgages require new legal documents to be completed. Pricing will vary depending on which notary or solicitor you choose.

Title search fees – Any financial institution completing a mortgage refinance will complete a title search. This ensures that there are no other liens ranking ahead of the mortgage registration. The majority of lenders require their mortgage to be in first priority, which is also known as a “first mortgage charge”.

Discharge fee – If you are selling your home and paying off an existing mortgage, the mortgage registration needs to be removed from the property title. Only a lawyer or notary public can do so and there is a cost for them to complete the discharge.
 
7. I’m a first time home buyer and I’d like to prepare myself as best I can before purchasing a new home. Besides budgeting for the appraisal fee and legal fees are there any other costs I should be aware of?
As a first time home buyer it is best to set a budget to plan for all costs associated with home ownership. Here are some of the key costs to consider:
 
High Ratio Insurance – In the event the borrower has less than a 20% down payment when purchasing your new residence, banking regulations require the borrower to add “default insurance” to the cost of the mortgage. The insurance premium is typically added to the mortgage loan balance. Default insurance protects the lender because the borrower is provided a larger mortgage loan. VPCU’s current default insurance provider is the Canadian Mortgage & Housing Corporation (CMHC). Should you wish to get an estimate of what that premium cost may be, please refer to the CMHC premium calculated that can be found HERE.
 
B.C. Property Transfer Tax – This cost is considered a “closing cost” meaning at the time you sign your mortgage documents at your lawyer/notary’s office, they will request sufficient funds to cover this cost. There are some exemptions available for this tax so we recommend members contact their lawyer or notary to advise accordingly. You can calculate your estimated property transfer tax by view a calculator provided by the B.C. government HERE.
 
GST on New Home Sales – This is another “closing cost”. All brand new properties are required to pay GST upon the completion of the sale of the property. There are some rebates available for this tax so we recommend members contact their lawyer or notary to advise accordingly.
 
Home Insurance – A member’s lawyer/notary will request a copy of a home insurance policy be provided at the time mortgage documents are signed. We recommend members shop around for a home insurance policy at least three weeks in advance of the completion date of your home purchase. We also recommend members seek earthquake and flood insurance in addition to the standard fire insurance included in most home insurance policies.
 
Moving Costs – Yes, you will have to pay the movers! Don’t forget to add them to your budgeting.
 
Property Tax – As a homeowner, annual property taxes are due typically on the first business day of July each year. Many municipalities also require homeowners to pay annually for water and utilities charges in the months of February or March or they may charge on a quarterly basis.
 
Strata Fees – If you live in a condominium, you will have to pay a monthly strata fee. This pays for all the maintenance costs for the building that you live in.
 
Condominium Content Insurance – If you live in a condominium, the strata will take care of all the maintenance costs through your strata fees. However, within your condo unit, the contents are not covered. In addition, should you be found responsible for an accident such as a flood of a condo unit below your unit, you are required to pay the strata the deductible for the strata’s insurance claim. In many cases, this deductible fee is in the tens of thousands of dollars. A condo content insurance policy will provide you with coverage to pay the strata’s deductible in situations like this. It is highly recommended that all condo owners take some form of condo content insurance to mitigate this risk.
 
Regular Maintenance – Depending on the age and build of your property, these costs will vary.
 
8. How long does it take to get a loan approval at VPCU?
Once you have provided us with a completed loan application form and the required income verification documentation, we will respond to your request within 1 to 2 business days. Response times will vary depending on the volume of requests. The most efficient way to submit your request is to email the signed completed loan application form and your income verification documents to loans@vpcu.com . If you are applying for a debt consolidation loan, please also send us the most recent statements of the loans and credit cards you wish to consolidate as well.
 
9. I can’t make it into the branch to sign documents or chat with a Loans Officer because of my unusual schedule. What can I do?
You can send us the loan application form by printing it off, completing and signing it and scanning it to us via email at loans@vpcu.com or directly to a lender you may be working with. We will correspond with you accordingly from there. Should your request be approved, and as electronic signatures are now accepted, all required documents would be sent through Docusign for you to sign via email. Please read about our Docusign service by clicking here.
 
10. I was declined for a mortgage 10 years ago. Does that mean I likely wouldn’t get approved today?
If an applicant was declined we would typically reconsider a new application within a year. Having said that, your financial circumstances may have changed recently or you may now have a co-applicant that is willing to support your loan request. In short, being declined for a loan 10 years ago has very little bearing on how we view a loan application today. We are focused on your current financial circumstances so please connect with our lending team so we can provide you our advice on how to best to move forward with your credit inquiry.

We have assisted members with many different solutions to help them rebuild their credit. We recognize life happens and there are all sorts of financial challenges that everyone is faced with at different points in their lives. In view of this, we do our best to come up with creative lending solutions to assist accordingly.
 
11. I see a lot of non-traditional lenders advertising on television and the radio saying you’re instantly approved if you own a home. What’s the catch?
Every lender will have a variety of different pros and cons with each of their product offerings and lending approaches. There are some lenders that focus on offering mortgage lending based exclusively on the amount of equity in your home while other traditional lenders (banks and credit unions) focus on a combination of equity, credit rating and a borrower’s employment income. Lenders that focus just on the equity of a home tend to charge higher interest rates and require applicants to pay higher loan fees while traditional lenders tend to offer better overall pricing.