LOANS & MORTGAGES
   ACCORDING TO GOVERNMENT REGULATIONS BORROWERS MUST BE ONTARIO RESIDENTS.
 
 
LOANS AND LINES OF CREDIT

PARAMA Benefits: Great rates, potential for a rebate on the interest you pay through our profit sharing program, flexible repayment plans and great service - what more can you ask for when looking for a personal loan or line of credit?


LOANS

Buying a car? Want to pay off a credit card? Come to PARAMA for your personal loan! We offer excellent rates, our loans are fully open and you can take up to 5 years to pay us back. All we need is a completed and signed Credit Application and a confirmation of your income to get started. Contact your PARAMA Loan Department today!


RSP LOANS

Every year right around RSP season, PARAMA offers special 1 year RSP Loans to our members. These loans are fast and easy, with a rate you can't beat and a payment deferment option, so you can wait for your tax refund before making any payments. Simply fill out the one-page application (available at either branch during RSP season) and we'll provide you with the money you need to invest in your PARAMA RSP.  If you want to catch up on contributions for previous years, longer repayment terms can be arranged at a slightly higher borrowing rate.


LINES OF CREDIT

PARAMA offers two kinds of Lines of Credit:

  • PERSONAL LINE OF CREDIT: linked to your Daily Chequing account, a personal Line of Credit is used primarily as an Overdraft, filling the gaps between paydays and purchases. Interest rates fluctuate with the Prime Rate and vary based on whether your LOC is unsecured or secured (usually with a PARAMA Term Desposit, GIC or TFSA).


  • HOME EQUITY LINE OF CREDIT ("HELOC"): also linked to your Daily Chequing Account, this is a registered Line of Credit secured by the equity in your home. Primarily used for renovations, debt consolidation and other large expenses, the HELOC is useful for current and future purchases and has flexible repayment terms. You can lock all or a portion of your outstanding HELOC balance into a fixed interest rate for a closed term of 1-5 years. This establishes regular fixed payments (subject to minimum amounts) in order to protect yourself from future rate increases. Once the termed-out portion is paid off, we can add that available balance right back into your HELOC again!

Fill out a PARAMA Credit Application, provide us with confirmation of your income and let us help you reach your financial goals. Contact your PARAMA Loan Department for more details.

MORTGAGES
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PARAMA Benefits: When you combine PARAMA's  competitive mortgage rates, potential rebates from our profit sharing program and fee-free everyday banking, why would you go anywhere else for your mortgage needs?

Let PARAMA help you purchase the home you want! We offer conventional and high-ratio residential and commercial mortgages at great rates. If you are a first-time home buyer, you may find the following "Mortgage Basics" summary helpful. If you already own a home, compare our rates, transfer your existing mortgage to us and take advantage of our Member Benefits!


MORTGAGE BASICS

Every first-time home buyer needs advice. Purchasing your home is not as complicated as it may seem, but there are things you need to know about the mortgage process.

1. Down payment: every financial institution requires you to make a down payment on a home purchase. Even "no down payment" mortgages do, in fact, require a down payment. Where the money comes from for the down payment is the issue. The smallest down payment a purchaser can make is 5% of the purchase price. The money for this down payment can be: cash you have saved, RRSP's (see www.ccra.gc.ca for details), a gift of cash, or borrowed. What "no down payment" means is the financial institution lends you the money or gives it to you in some form of "cash back" payment. These types of mortgages usually involve large fees, higher rates, and not everyone can qualify for them.

PARAMA does offer High Ratio mortgages, which require a minimum of 5% down and are insured by one of two mortgage insurers (Genworth Financial or CMHC). There is an insurance premium (plus HST) - payable to the mortgage insurer, not to PARAMA - and an insurance premium, which can be added right onto your mortgage amount and calculated into your regular payments. Please note that PARAMA does not charge a higher rate for High Ratio mortgages.

If you can provide 20% of the purchase price, your mortgage will be a Conventional mortgage, with no outside fees or premiums.

2. Appraisal: every mortgage lender will require a current appraisal of the property you are purchasing. With a conventional mortgage, PARAMA orders the appraisal for you but you pay the fee. With High-Ratio mortgages, the mortgage insurer does their own appraisal and the fee is included in your insurance premium fee.

3. Registration: When first purchasing a property, the Credit Union requires you to choose a lawyer in order to perform title searches to protect our interest in your mortgage loan and to make all necessary registrations on the property. We do not recommend any lawyers in particular; however, we do know of a few near our branches and would be happy to direct you to their offices. Lawyers charge their own fees for services rendered in ensuring that your title to the property you wish to purchase is properly registered. Please contact your lawyer of choice to find out how much they charge for their services. If refinancing your current mortgage or transferring into Parama, we use a company called First Canadian Title (FCT) to make the appropriate searches and registration. Their fees are substantially lower compared to lawyer's fees. It's just another way that Parama hopes to save you money.

4. PARAMA Mortgage Application: as with any loan, we need a completed application from you along with any supplemental documentation, such as confirmation of income and a copy of your purchase agreement ("Agreement of Purchase and Sale").

5. Terms: once your mortgage has been approved, you need to decide what "terms" you would like. PARAMA offers two types of mortgage terms:

  • OPEN VARIABLE: which have flexible repayment terms and a fluctuating rate.
  • FIXED RATE: where you choose a rate to "lock in" to for a specific period of time, and which are restricted to a fixed repayment amount but allow you to increase that amount by 15% each calendar year AND/OR make an annual lump-sum principal payment of 15% of your original mortgage amount.

PARAMA also offers the following mortgage-related loans:

Bridge Loan: if you have SOLD your home and have PURCHASED another, but your sale date is AFTER your purchase date and you temporarily need money to close the purchase of your new home, you need a Bridge Loan. Bring us your signed, unconditional offers for the sale AND the purchase, and we can help you "bridge" the gap between the two.

Interim Financing: if you would like to PURCHASE a new home but have NOT SOLD your current home, you may qualify for Interim Financing. This loan is secured by your current home and is paid off with the eventual sale of it. We will need a copy of your Purchase Agreement and all documentation needed for a typical mortgage application.

Refinancing: instead of taking out a loan or using your credit cards for a large purchase or renovation project, you can Refinance your current mortgage. You go through the same steps as with your first mortgage, but you add money to the existing balance. A new appraisal may be required and you will have to use a lawyer or First Canadian Title (FCT) to keep the legal end clean, but you can take advantage of a better rate (vs. loans and credit cards) and one simple payment to take care of your expenses.

Mortgage Pre-approval: if you're just shopping for a home and want to know the mortgage amount you are eligible for, bring us a confirmation of your income, how much of a downpayment you intend to make and we'll help you come up with a reasonable purchase price. Once you have signed a purchase agreement, your information will be re-evaluated and the regular mortgage approval process will commence.


MORTGAGE TRANSFERS

Already have a mortgage at another financial institution? Transferring your mortgage to Parama is easy! We'll need a statement of your current mortgage, an appraisal of your property and, of course, a completed application. See our rates, take a look at the potential rebates from our profit sharing program and our great services, and you'll wonder why you didn't transfer your mortgage sooner!

PARAMA is here to help you purchase the home you want. Please contact PARAMA's Loan Department for more information on any kind of purchase financing: we are happy to help you!

INSURANCE
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Purchase some peace of mind for you and your loved ones with Life, Disability and Loss of Employment Insurance from Credit Union Insurance Services (www.cuis.com). In the event of the unexpected, your Loan, Line of Credit or Mortgage payments are fully covered.

For Loans, we offer Life and Disability Insurance. The total insurance premium is added to your loan amount and is calculated into your regular loan payments: you have nothing more to think about and your payments are covered.

Line of Credit Life and Disability Insurance is paid by automatic monthly withdrawals and is based on your average monthly balance.

For your Mortgage, choose from Life, Disability and Loss of Employment to insure your payments. This premium is divided into monthly instalments and is taken directly from your PARAMA chequing account.

Protect yourself and your family: Don't let Loan and Mortgage obligations weigh on your loved ones in case of unexpected unpleasant events. Ask your PARAMA Loan Department for additional details.



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