To understand what a discount mortgage is, one must first understand what a regular mortgage is. When purchasing a home, most people won’t have the funds to pay the entire purchase price up front. This is what a regular mortgage is; a loan to pay for the home. Like all financial products from lenders, there is a cost for borrowing money. This cost is based on several factors including how much money is borrowed and the length of time the loan is extended. The cost is also based on the individual and their particular financial situation. The differences between a regular loan and a mortgage lie in the details:

• • A mortgage is a considerably larger amount of money than a typical loan, often hundreds of thousands of dollars.
• A mortgage can be considered a ‘secured loan’ via the property that is being purchased
• There will likely be a remaining balance at the end of the mortgage term that requires additional payment
• A mortgage requires renewing several times at regular intervals before being completely paid off
• There is a more regimented qualification process required for a mortgage, including a test to determine if a person will be able to continue to make payments should their financial situation change mid-term
• An initial amount of money is required upfront – this is known as a mortgage down payment that starts at 5% of the purchase price for first time buyers, and increases from there
• It is common for a mortgage contract to be broken due to personal circumstances, although there are penalty fees associated with this

A ‘discount’ mortgage is a misnomer. This phrase is really used as a sales tool to draw in people who don’t have a clear understanding of what a mortgage is or how it works. A better term should be ‘fair mortgage’ because a discount mortgage really just translates to the circumstances in which a borrower is able to obtain the best terms and rates available to them based on their situation.

Often people who are looking for the best deals and discount mortgages in Ontario do so because they have bad credit. Poor credit negatively impacts a person’s purchasing power; especially for big ticket items. A person with decent to excellent credit is able to obtain financing a lot easier, and will also find that the interest and terms of that financing is both reasonable and affordable. A person with bad credit, or no credit history will find that they are no eligible for financing at all or, if they are the interest rates are exorbitant.

Other people looking for discount mortgages are doing so because they recognize the value of saving money whenever and wherever possible. After all, a penny saved is indeed a penny earned!

A little known tip for finding a discount mortgage in Ontario is knowing where to shop.

Shop2Save, which is an online volume buying and savings program offers an innovative loyalty program that rewards it’s members for shopping smarter. Shop2Save aims to give the purchasing power back to consumers by not only offering the very best in volume discounts, but also by offering real cashback rewards dollars for every dollar spent. And, not just on typical purchases; the Shop2Save loyalty program also includes big-ticket items. For members shopping for discount mortgages, they will be rewarded with both the best possible rates for their situation (a.k.a. the elusive ‘discount’ mortgage) AND earn cashback rewards when arranging a mortgage with Canada’s leading mortgage company Dominion Lending Centers.

Visit Shop2Save to see how you can arrange a discount mortgage in Ontario today!