Amortization: The period of time, often a maximum of 25 years, required to reduce the mortgage debt to zero when all regular blended payments are made on time and provided the terms (payment and interest rate) remain the same.

Mortgage payment: A regularly scheduled payment that is often blended to include both principal and interest.

Interest: The cost of borrowing money. Interest is usually paid to the lender in regular payments along with the repayment of the principal (loan amount).

Once you've made the necessary calculations and feel that you are ready to obtain a mortgage, it's a good idea to select a lender to get pre-approved. This means that the lender will look at your finances to establish the amount of mortgage you can afford. At that time, the lender will give you a written confirmation or certificate for a fixed interest rate good for a specific period of time.

Some buyers may not wish to pursue a mortgage pre-approval until they have found the home they want to buy. However, the idea of having a pre-approved mortgage amount makes the search for your new home much easier and less time-consuming because you have a good price range in mind.

Some of the things you will need to have with you the first time you meet with a lender are:

• Your personal information, including identification such as your driver's license
• Details on your job, including confirmation of salary in the form of a letter from your employer
• Your sources of income
• Information and details on all bank accounts, loans and other debts
• Proof of financial assets
• Source and amount of down payment and deposit
• Proof of source of funds for the closing costs (these are usually between 1.5% and 4% of the purchase price)

Will You Have Trouble Qualifying for a Mortgage?

Your calculations may show that you will have trouble meeting monthly debt payment and that you will likely have trouble getting approved for a mortgage. Here are some things you can do:

• Pay off some loans first
• Save for a larger down payment
• Revise your target house price

Other Helpful Strategies

• Meet with a credit counsellor who can help you minimize your debts.
• Buy your home through a rent-to-own program provided by the builder, a non-profit sponsor or a government sponsor.
• Find out about programs through which you can help build your own home.
• Ask the housing department of your municipality about any special programs available.