Where do you lend?
For now, Edison is only licensed to broker mortgages in British Columbia. Within British Columbia Edison will lend from Squamish to Chilliwack, the Capital Regional District, Central Vancouver Island (Nanaimo, Comox and Parksville) and the Okanagan (Kamloops, Kelowna, Penticton and Vernon). If your property is not in one of those regions, feel free to talk with us to see if there is some way we can work together on an exceptional basis.
We are working on expanding our offering to be across Canada. Stay tuned on that front!
I want to rebuild my house. Can I take out money for that?
Unfortunately, Edison does not do Construction Loans, but we do give home equity loans for renovations of your existing home.
What is the difference between a fixed rate mortgage and a variable rate mortgage?
A fixed mortgage rate is set for the duration of the mortgage term. Mortgage interest rate and payments are fixed.
A variable mortgage rate fluctuates with the market interest rate, known as the ‘prime rate.’ Mortgage payments either fluctuate with fluctuations in the prime rate, or the interest portion of the payment varies.
What is the difference between an open term and a closed term?
An open mortgage gives homeowners the flexibility to pay off their mortgage at any time without paying a penalty.
A closed mortgage is little more strict — if you pay it off before the mortgage term ends, you have to pay a penalty. Closed mortgages also have a prepayment limit.
Why can't I take out a longer term mortgage?
Edison’s product is designed to be a temporary form of financing and is not an amortizing loan. That said, Edison may renew your loan for an additional one year term if you are making your payments on time and meet other criteria that our lending committee has set from time to time.
What happens if my circumstances change and I need to pay off my mortgage?
Most of our mortgages are open mortgages. In the event you need to pay off your mortgage prior to the end of the term, you will be able to do so without any penalties.
Why do you have higher rates than my bank?
The short answer is because we lend to borrowers that are outside of the conventional mortgage space. By operating in that space, Edison takes on more risk with its borrowers and has to charge accordingly.
The long answer is that banks have access to cheap capital in the form of deposits and are able to insure their mortgages or sell them into a federally backed securitization program. Both of those advantages mean that the banks have a lower cost of funds as compared to Edison, and therefore can lend at cheaper rates.
Why are my payments similar to what my bank was charging me?
The interest on a home equity loan is typically assessed as interest-only payments. This means that borrowers pay monthly interest throughout the term of the loan and then make full repayment at the end of the term.
Monthly payments aren’t amortized like a conventional mortgage. However, while the interest rates on a home equity loan might be higher than when compared to a conventional mortgage, the monthly payments might actually be very similar.