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Beforeyoutakeyourfirststeptowardsbuyingahomeitisimportanttodeterminewhatyoucanaffordandthendecidewhichmortgagetypeworksbestforyou.Herearesomebasicmortgagetermsthatyouneedtoknow1TypesofMortgagesTherearetwobasicoptionstochoosefromaconventionalmortgagewhichrequiresatleasta20percentdownpaymentandahighratiomortgagewhichisdesignedforpeoplewhodonothavethe20percentdownpayment.Ifyoupurchaseahomewithahighratiomortgageyouwillpaymortgagedefaultinsurancewhichtransferstheriskofthedefaultfromthelendertothemortgageinsurer.Mortgageinsuranceisnottobeconfusedwithmortgagelifeinsurance.Whilebothprovideadditionalpeaceofmindforhomebuyersmortgagelifeinsuranceprovidesprotectiononlyintheeventofdeathorseriouslong-termdisabilitynotdefault.2AmortizationPeriodBothaconventionalandhigh-ratiomortgagecanhaveavarietyoffeaturessuchastheamortizationperiodwhichisthelengthoftimeoverwhichyourentiremortgageistobepaid.Somepeoplechoosea15or20-yearamortizationiftheywanttoowntheirhomeassoonaspossible.Othersprefera30-yearamortizationinordertohavetheflexibilitytomakelowermonthlypayments.Alowermortgagepaymenteverymonthfreesupmoneytocoverothermonthlyexpensesyoumayhave.3InterestRatesAnotherchoiceiswhethertoselectavariableorfixedinterestrateonyourmortgage.Afixedinterestratemortgagehasapre-determinedratethatwillnotchangeduringthemortgagetermnotetermlengthisdifferentfromamortizationandistypicallythreefiveortenyears.Fixedinterestratemortgageshelptoprotectyoufrommarketinterestratefluctuationsmakingiteasierfornewhomebuyerstomanagetheirbudget.Withafixedinterestrateyourmortgagepaymentsremainthesamemonthtomonthsoyoudonx19tgetanysurprises.VariableinterestratemortgageshaveinterestratesthatareadjustedbasedontheprimeinterestratesetbytheBankofCanada.Iftheprimerategoesupyourinterestmaygoupandthatcouldaffectyourmonthlymortgagepayments.Converselyiftheprimeratedropsyoucouldfindthatyouarepayingoffmoreofyourprincipalfastersinceyourinterestratemaybelower.Itisbesttospeakwithamortgageprofessionalaboutyouroptions.Findingyourcomfortzone20