Homewise Review: Everything You Need To Know

Finding the right mortgage can be a challenge. With so many things to consider, such as amortization periods, prepayment privileges and penalties, interest rates, and term lengths, you might want an expert to help you determine what you need.

Homewise is a Canadian company that provides that expertise. As a licensed mortgage brokerage, Homewise tries to help you find the right mortgage for your needs at no cost. Keep reading to learn whether Homewise is the right choice as you shop for a mortgage.

Homewise provides a range of mortgage options, in an attempt to ensure that clients find the ideal loan tailored to their unique financial situation. By partnering with over 30 banks and lenders, Homewise offers an extensive selection of mortgage products that try to cater to a wide variety of needs. Those needs can include preapproval, purchase approval, refinance and mortgage renewal or switch. Homewise also offers reverse mortgages.

Loan Types

Homewise offers both fixed and variable-rate mortgages with flexible terms, ranging from short-term solutions to long-term stability:

• One-year fixed
• Two-year fixed
• Three-year fixed
• Three-year variable
• Four-year fixed
• Five-year fixed
• Five-year variable
• Seven-year fixed
• 10-year fixed

No matter what your situation is, Homewise may have a mortgage for you. The company offers financing for:

• First-time homebuyers (including pre-approvals and approvals)
• Repeat homebuyers
• Newcomers to Canada
• Self-employed
• Renewals
• Refinancing
• Alternative/B mortgages
• Private mortgages
• Second mortgages
• Investment Properties
• Reverse mortgages

Homewise also offers mortgage solutions for a variety of residential property types, ensuring that you can find the right financing for your home, no matter its nature:

• Single-family homes
• Condos and townhomes
• New construction
• Second homes
• Vacation properties
• Owner-occupied investment
• Rental properties (up to four units)

Loan Minimum

The minimum borrowing amount to obtain a mortgage with Homewise is $100,000. This flexibility allows more clients to access the financing they need, even for smaller-scale purchases or investments.

Loan Maximum

While Homewise doesn’t specify a maximum mortgage amount, the company’s extensive network of lenders allows for competitive financing options, including for homes valued over $5 million.

Loan Servicing

Homewise partners with some of the most reputable lenders in Canada, ensuring that your mortgage is managed with the highest service standards. Depending on the lender, your mortgage may be serviced directly by the lender, but Homewise continues to provide ongoing support and guidance throughout the life of your mortgage. Homewise lenders include, but are not limited to:

• TD
• Scotiabank
• Equitable Bank
• Manulife Bank
• First National Financial
• RMG Mortgages
• MCAP
• B2B Bank
• Strive Capital
• Neo Financial
• Desjardins
• DUCA

This list includes local lenders like the Alberta Treasury Board (ATB), which is only available in Alberta, and Meridian Credit Union, which is only available in Ontario.

Homewise is ideal for a broad range of homebuyers and homeowners, particularly those who value a tailored mortgage experience beyond securing a low rate. They market themselves as perfect for all kinds of borrowers thanks to their stated ability to tailor their mortgage offerings to any situation. Therefore, they feel they are best for borrowers seeking the best rate and features, first-time and repeat homebuyers, renewals and refinancers looking for the best deal, newcomers to Canada, employed borrowers and those who value flexibility.

Getting a mortgage with Homewise is relatively straightforward. All you have to do is provide some information about yourself and the property you want to mortgage. Then, one of their experts will help you make it happen by finding quotes from lenders that may suit your needs.

• Step 1. Create a profile. The first step in getting a mortgage through Homewise is to create a profile on their website. You’ll be asked questions like whether you’re buying or refinancing a home, how you’ll use the property, and when you need your mortgage funds. You’ll also be asked to provide information about yourself, including details of your current home, income, expenses and debt obligations.
• Step 2. Homewise will find you a quote. Once your online profile is complete, Homewise will assign you a licensed mortgage agent as your go-to contact for arranging your mortgage. Your mortgage agent will review your profile, clarify any details that might be missing, and compare mortgage products across dozens of lenders to find a mortgage with a rate and term that fits your unique situation.
• Step 3. Choose an offer. Once your offers are ready, your Homewise mortgage agent will help you review the mortgages and weigh the pros and cons of each. With their advice, you’ll select the offer that makes the most sense for your circumstances.
• Step 4. Get funded. Once you’ve selected your mortgage, your Homewise agent will work with you to complete the application process. You’ll be asked to sign paperwork as well as provide identification and financial documents. You may also be asked to visit a bank branch to sign papers in person. Finally, you’ll need to employ the services of a real estate lawyer to close the mortgage.

Minimum Credit Score

A credit score of 650 or more is required to be considered for the best rates, but there is some flexibility, as Homewise works with lenders that may accommodate credit scores that are below this threshold.

Related: What Credit Score Is Needed To Buy A House?

Minimum Down Payment

A minimum down payment of 5% is needed for properties under $1 million, and 20% for properties valued at $1 million or more. Homewise also offers guidance on securing mortgage default insurance From the Canadian Mortgage and Housing Corporation (CMHC) if your down payment is less than 20%.

Maximum Debt-to-Income Ratio

Homewise considers both your gross debt service ratio (GDS) and total debt service ratio (TDS) when qualifying you for a mortgage. The GDS, which compares your housing costs to your income, should not exceed 39%, while the TDS, which includes all other debt obligations, should not exceed 44%. However, Homewise’s access to a wide range of lenders may provide flexibility for well-qualified borrowers.

Homewise says they ensure that there are no hidden fees or unexpected costs when their clients secure a mortgage with them. There are no fees with their services when it comes to advice from the advisors assigned to each prospective client for consultation because they make their money from the lenders homewise works with. That being said, other fees not charged by Homewise but by the lender you choose may apply.

Prepayment Penalties

As Homewise has many lenders to choose from, it allows them to find the most flexible solution for your needs. This includes their ability to offer flexible prepayment options, allowing you to increase your monthly payments by up to 20% and make lump-sum payments of up to 20% of your original mortgage amount each year without penalty. Some lenders they work with even allow for a full 100% double-up on monthly payments so that they can double their payments and pay down their interest more quickly. If you exceed these limits or decide to break your mortgage early, a prepayment penalty will apply. Some lenders have higher penalties, so Homewise Advisors guide their clients to understand which lenders provide the best options for both rates and features.

• Fixed-Rate Mortgages: For fixed-rate mortgages, the prepayment penalty is calculated using an interest rate differential (IRD) method, which is a common industry standard.
• Variable-Rate Mortgages: For variable-rate mortgages, the penalty is typically three months’ simple interest, calculated on the principal balance at your current interest rate.

Related: What Percentage Of My Income Should Go To Mortgage?

Real Estate Agents

Homewise has its own real estate brokerage and Real Estate team members that they can connect potential buyers and sellers with to help in their home search. These realtors include some of the top realtors in the country, and when borrowers work with Homewise for both their mortgage and real estate transactions, they can have thousands in savings. They also provide tailored real estate listings to their clients, all from their listing site

Real Estate Lawyer

Homewise has an integrated partnership with a Real Estate Lawyer, which enables them to offer $200 off legal fees to their clients.

Title Insurance

Title insurance protects you against potential issues with your property’s title, such as errors in surveys, unpaid taxes, or third-party claims. The average cost of title insurance in Canada is around $350. Homewise can help coordinate this through its integrated service partners.

Life Insurance

While life insurance is not mandatory, it is a product that many borrowers consider in their buying experience. Homewise has an integrated partner that helps their borrowers leverage in the process if they are interested.

Property Insurance

Property insurance is mandatory in the homeownership experience. Homewise offers integrated partners for property insurance and advertises that it has exclusive low prices to provide additional savings.

Applying for a mortgage with Homewise is simple and can be done entirely online, with their simple five-minute online application. The process begins by answering a few straightforward questions about your needs. You’ll be asked whether you’re purchasing, renewing or refinancing a mortgage, along with information about the property and personal details about yourself and any co-applicants.

Related: What Does It Mean To Co-Sign A Mortgage?

At the end of your application, you will be provided with your best three tailored options, with low rates and strong features that you can choose from. You can also discuss more options with your personal Homewise mortgage advisor. Once the initial details are provided, you’ll be connected with a dedicated Homewise mortgage advisor. They’ll guide you through the specifics of a conditional mortgage offer that was selected and provide you with access to rates and features across over 30 banks and lenders. Your advisor will answer any questions and ensure you select the mortgage that’s perfectly suited to your financial needs. This can be for preapproval, approval, renewal or refinance.

When you’re ready to proceed, Homewise will work with your lender choice on your behalf to manage all of the admin work. They’ll send all necessary paperwork your way to easily sign with e-sign, initially on your own and later with your real estate lawyer. During this time, you’ll also need to provide required documents, such as identification, bank statements, proof of income, a preauthorized debit agreement, and an accepted agreement of purchase and sale if you’re purchasing a home. Your Homewise mortgage advisor will assist you every step of the way, ensuring you gather all the required documentation without hassle.

Related: Five Things You Need To Be Preapproved For A Mortgage

Assuming everything moves smoothly, your lawyer will coordinate with Homewise to ensure the mortgage funds are transferred on time and allocated as needed.

Approval, Underwriting, and Closing Timeline

While timelines can vary, it’s generally recommended to allow at least 10 days from initial contact for your mortgage to close. This timeframe includes approval, document submission, underwriting and final funding of the mortgage. If you’re working with a tight deadline, simply let your Homewise advisor know, and they’ll work to ensure your mortgage closes in time.

To qualify for a mortgage with Homewise, you’ll need to meet several key criteria, including having a qualifying credit score, a suitable down payment, and manageable debt ratios.

Down Payment and Loan-to-Value (LTV) Ratio

For home purchases, Homewise requires a minimum down payment of 5% for properties under $1 million and 20% for properties priced at $1 million or more. You’ll also need to demonstrate that the funds for your down payment have been in your bank account for at least 90 days and originate from an approved source. If you’re renewing or refinancing your mortgage, Homewise will adhere to various LTV ratios.

Closing Costs

For home purchases, Homewise will ensure you have enough cash available to cover closing costs in addition to your down payment. The industry standard for closing costs is typically around 1.5% of the purchase price of the home. This is not a Homewise fee, it takes into account costs like government taxes, property insurance, legal fees and more.

Income and Debt Service Ratios

Homewise uses the same guidelines as major banks, limiting your Gross Debt Service (GDS) and Total Debt Service (TDS) ratios to 39% and 44%, respectively. These ratios will be calculated based on the Bank of Canada’s benchmark qualifying rate, or 2% higher than your actual mortgage rate, whichever is higher. Important to note, that Homewise also works with alternative, or B Lenders that allow borrowers to qualify who may not meet the standards of schedule A lenders. These come with slightly higher rates; however, they are helpful to borrowers with lower credit, higher debt, are new to Canada, or are self-employed.

Credit Score

To qualify for a prime A low-rate mortgage with Homewise, you’ll generally need a minimum credit score of 650. That said, Homewise typically prefers clients with a score of 680 or higher, with no history of missed payments or bankruptcies. If your credit score falls short of the required threshold, Homewise will still work with you to explore options and connect you with alternative lenders who specialize in providing mortgages to those with lower credit scores.

The Property

Homewise focuses on providing mortgages for residential and investment properties, as well as owner-occupied residential properties with up to four units. The property must meet specific qualifications in terms of structure and occupancy.

What To Do If You Get Turned Down

If your mortgage application is declined by Homewise, your mortgage advisor will provide a clear explanation and help you resolve the issue. The most common reason for mortgage denials is incomplete or missing documentation or not meeting the qualification needs for a down payment or income. Your Homewise mortgage advisor will work with you to identify the problem and guide you through the process to fix it. If the application is denied due to issues like your credit or concerns over your ability to afford the mortgage, Homewise will help you explore alternative lending options that better suit your financial situation, or provide advice for approval in the future.

Homewise simplifies the home-buying process from start to finish, making it easy and stress-free, especially for first-time buyers. Their approach focuses on helping clients understand their financial situation and secure the best mortgage options available.

• Preapproval: They assist buyers in obtaining a quick preapproval, ensuring they know their affordability and have a clear understanding of their budget. Also, it helps lock in the lowest rate from many lenders.
• Tailored Support for First-Time Buyers: Homewise has extensive experience working with first-time homebuyers. Their team ensures the process is straightforward, guiding clients from preapproval all the way through to locking in the best mortgage rate. Of course, own-up buyers get a lot of help too by getting strong advice on how to move from their current home to their next, and how to leverage their current home equity to maximize their purchasing power.
• Seamless Transition to Mortgage Approval: Once you’ve found your dream home, Homewise helps you smoothly transition from preapproval to mortgage approval. They ensure that you secure the best possible rates and features tailored to your specific needs, by shopping their 30 banks and lenders. Even if you already have a rate from your preapproval, they will continue their search for your best options.
• Real Estate Services: For those interested, Homewise Real Estate offers personalized property listings and realtor support, providing a comprehensive service that goes beyond just mortgage brokerage.
• Integrated Services for Convenience: To make the process even smoother, Homewise provides integrations with property insurance, life insurance and real estate law services

Refinancing with Homewise

Before moving forward with refinancing, it’s important to be aware of potential costs. If you break your existing mortgage early, your current lender may impose a prepayment penalty. Your Homewise advisor will walk you through the refinancing process and help you understand any fees, ensuring you make the best financial decision for your situation.

Renewing with Homewise

On average, Homewise promotes that it saves clients 20% off their existing mortgage rate at renewal, which can translate to thousands of dollars in savings over the life of your mortgage. A Homewise mortgage advisor will guide you through the process, helping you explore options that may lower your payments, adjust your mortgage term or offer more flexibility to fit your financial goals.

Homewise Vs. Nesto

Nesto is one of the best mortgage lenders in Canada, and it is ranked by Forbes Advisor Canada. This online mortgage company promises some of the best mortgage rates, excellent customer service and speedy mortgage approval.

While Nesto is an excellent choice for your mortgage, Homewise may be a better option in some circumstances. Nesto doesn’t offer one-year fixed mortgages or home equity lines of credit, but Homewise does. Homewise also offers mortgage solutions for people who are self-employed and who have bad credit. In contrast, Nesto only works with people who match the typical profile of an ideal borrower.

Homewise Vs. Dominion Lending Centres

Dominion Lending Centres is one of Canada’s largest mortgage brokerages, with over 380 locations nationwide. Working on a franchise model, It lends its brand and advertising power to local mortgage brokers who work independently.

By contrast, Homewise works entirely online from a centralized office. They don’t have brick-and-mortar locations, and they employ their mortgage agents directly. As such, Homewise likely has lower overhead costs and may be able to pass their savings along to you at a cheaper rate on your mortgage.

Homewise Vs. Equitable Bank

If you need a mortgage but don’t quite meet the bank’s income requirements or have its minimum credit score, Equitable Bank is one of the lenders that may give you one. They specialize in mortgages for people who are self-employed, have more debt than the major banks are comfortable with, and have less-than-ideal credit.

In fact, Equitable Bank is one of the many lenders Homewise works with. If you don’t meet the typical lending criteria, Homewise can help you compare Equitable Bank’s mortgages with offers from other alternative lenders. These partnerships make Homewise an ideal choice for people concerned about their odds of being approved for a mortgage.

When reviewing mortgage brokers we consider the following factors:

• Interest rates offered: 20%
• Loan types offered: 10%
• Fees: 15%
• Customer Service Experience: 20%
• Loan Amounts Offered: 15%
• Minimum Credit Score For borrowing: 10%
• Additional Services offered: 10%