Yes, of course it happens that, once in a while, a real estate transaction goes through on a cash basis. In almost all cases though, the buyer must secure financing before the transaction can be completed.

Up to this point you may have done some general thinking about a mortgage. If there isn't already a mortgage in place, the buyer must now work with a lending institution to obtain one. Here are some important questions to ask the lender.

What types of mortgages are offered? Most major banks have several mortgage 'products'. You can get variable rate mortgages and fixed rate mortgages.

What prepayment privileges are available?

Is mortgage insurance required? What are the premiums?

What are the payment frequency options? They can be weekly, bi-monthly or monthly.

Is the mortgage portable and assumable?

Next you'll have to consider the down payment. The more money you (the buyer) put down, the lower the monthly payments. In this regard, there are two types of mortgage -- conventional or high ratio. The decision point is generally twenty five percent.

Conventional mortgages are for those who don't have the required twenty five percent down payment. If you don't have that money, you can try for a high ratio mortgage or possibly assume an existing mortgage. A second mortgage is also an option.

High ratio mortgages are for those who do have the necessary twenty five percent down payment but, in the lender's opinion, lack the required income for the lenders debt service ratios. Here your options can include making a larger down payment, consolidating other loans within your mortgage or getting someone to cosign your mortgage.

Once you have selected a lender and chosen the type of mortgage, the application process begins. Here is a list of things you can do to make this go more smoothly:.

• Ask your employer for a letter confirming your employment status. This would include number of years with that employer and current salary.
• Make photocopies of your T4 tax slips going back 3 or 4 years.
• Make a list or your assets and liabilities to determine your net worth.
• Itemize the sources for your down payment, including account numbers.
• Bring along all relevant information about the home you are purchasing

Call "The Wall" For Real Estate Support.