Find The Best Mortgage Rates In Yukon

Your Guide To Getting The Best Mortgage Rates In Yukon

Your one-stop-shop for getting the best mortgage rates that Yukon has to offer is, without a shadow of a doubt, Compare Mortgages. We guarantee that you can completely depend on us to provide you with the necessary guidance for navigating mortgages in any market type and also supply you with the best interest rate upfront. 

About Yukon

Yukon promises homeowners plenty — ranging from incredible views to an active job market. However, the territory’s cost of living can be well over the average, which is why getting the best possible rate for your mortgage loan is essential. This page would provide you with all the information you need to have about the process of buying a home in Yukon and would also guide your loan choice.  

Yukon is located in northwest Canada, and the territory can be aptly described as sparsely populated, wild, and mountainous. In the Kluane National Park and Reserve, you would find the Alsek River, trails, glaciers, as well as Canada’s highest peak, Mount Logan. To the south are several glacier-fed alpine lakes, a notable one being the boldly coloured Emerald Lake. To the far north, Ivvavik National Park can be found alongside its Porcupine caribou calving grounds that are protected.

Key Facts About Yukon:

• Yukon’s territorial capital is Whitehorse, which doubles as its only city.
• The Yukon River shores are occupied by Whitehorse’s Riverdale and downtown areas. The river has its origins in British Columbia and joins up with the Bering Sea in Alaska. 
• The city got its name from the White House Rapids as a result of its similarity to a white horse’s mane that was located in Miles Canyon prior to the river being dammed.
• It is notable for its volcanoes (dormant and active), snowmelt lakes, snow-capped mountains, coniferous forests, snow-capped mountains, glaciers, cold water rivers, and the Arctic’s frozen tundra’s characteristic stark landscape.
• The territory is home to three national parks and eight provincial parks. The territory’s most popular national park is Kluane National Park and Reserve, which is situated close to the Alaskan border. Saint Elias Mountain Range, located in the park, serves as home to seven out of the ten highest mountains in Canada, including the highest point in the country, Mount Logan. In 1979, UNESCO declared it a World Heritage Site thanks to its remarkable icefield and glacier landscapes as well as the essential nature of the habitats of grizzly bears, Dall sheep, and caribou.

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About The Yukon Housing Market

The Yukon housing market felt the impact of the coronavirus pandemic very strongly. The impact was particularly felt in Whitehorse with its steady but aging population. Developers have been impeded from fulfilling the demand for new construction as a result of lumber supply problems and rising prices of existing homes have caused affordability problems for some residents. The challenge has been further exacerbated by an increasing migration rate to Yukon from other countries and other areas in Canada.  

First-Time Home Buyer Programs In Yukon

First-time homebuyers may take advantage of first-time homebuyer programs provided they are willing to set down roots in one of the rural areas outside Whitehorse. Yukon Housing can provide potential homebuyers with loan financing for up to 30 years and a five-year term on new construction done in rural Yukon. You also get interest-free payments during the construction process and interest rates that are pegged at a minimum of 1% lower than the prevailing rate at the point of construction completion. 

Yukon homeowners can also apply for rebates on upgrades or renovations to make their home a better version of an energy-efficient one. You can apply and get approved for the loan financing program and the rebates. 

Yukon Historical Mortgage Rates Trends

The Yukon housing market has seen a pretty turbulent period in the past five years. 2021 saw rates come down to a 20-year low as a result of the pandemic, going down to 1.4% for the very first time. The current mortgage rates in Yukon have begun to increase in 2022 to 1.99%. However, current mortgage rates are sitting around the 4.69% mark on a 5-year fixed rate.

What Are The Different Types Of Mortgages?

Open vs Closed Mortgage

An open mortgage allows for prepaying any amount of your mortgage at any given time without having to deal with a prepayment penalty. The trade-off for this flexibility that an open mortgage provides is the higher interest rate that follows the mortgage.  

On the flip side, a closed mortgage has a lower and more attractive interest rate, namely because the flexibility allowed in an open mortgage is missing here. Instead, there is a cap on the extra mortgage payment that you can make per year. This implies that you can only pay a specific percentage of your current or original balance annually – usually an average of 15%, however, there may be variations depending on the lender. If you are allowed to choose, ensure that you go for the option of original balance prepayment because it allows you to make more payments annually. Given that you would receive a prepayment penalty if you exceed your annual payment limit, it is essential to note these limits and remain within them.

Fixed Mortgages

Of all the mortgages in Canada, fixed-rate mortgages typically are the most popular. With a fixed-rate mortgage, your interest rate stays unchanged through the entire term of your mortgage (1 to 10 years).  Fixed-rate mortgages can be a good idea for conservative homebuyers working with a tight monthly budget or having their eyes set on a stable payment schedule. 

Variable Interest Rate Mortgages

A variable interest rate sees fluctuations throughout the term through increases or decreases. 

There are two versions of variable interest rate mortgages:

1. Variable rates with adjustable payments 
2. Variable rates with fixed payments

Fixed Payments With A Variable Interest Rate

In general, under this option, the payment remains fixed over time despite variations in the interest rate.

If the interest rate increases, more of your payment goes towards the interest and less to the principal.

If the interest rate decreases, more of your payment goes toward the principal. This means you pay off your mortgage faster.

Adjustable Payments With A Variable Interest Rate

Adjustable payments, true to their name, have payment amounts changing as interest rates in Yukon change. A fixed portion of the payment goes to the principal. As interest rates change, the monthly payment will increase or decrease. 

Land Transfer Tax In Yukon

The property value determines the land transfer tax paid by Yukon residents. The tax is a portion of closing costs and typically caters to the property ownership being passed to you. There may be variations in the rate depending on local governments, so Whitehorse’s rates may differ from the rates of other rural areas in the territory because it is a big city. Homebuyers within the Yukon territory have a flat fee based on their home value that comprises title transfer and a mortgage fee. There may also be a minimal assurance fee included.   

– Whitehorse – $50-$750 title transfer plus $50-$1,000 mortgage fee

– Dawson – $50-$750 title transfer plus $50-$1,000 mortgage fee

What Affects My Mortgage Rate In Yukon? 

Various factors all play a role in determining your mortgage pricing. They include income, credit score, the purpose of the loan, and down payment. 

Down Payment

How much you make as a downpayment determines your loan-to-value (LTV) ratio. Your LTV is the paramount factor in mortgage rate pricing following the insured or insurable lending criteria. It also determines whether you would have to pay mortgage default insurance alongside your recurring mortgage payments on your mortgage. 

For properties that fall under the less than 1 million dollars valuation benchmark, insured and insurable mortgage rate pricing would apply, and the amortization is up to 25 years. In scenarios such as this, there is a lower risk of loss to the lender, and as such, they would offer better mortgage rates.

In a situation where you make an insured purchase with less than a 20% down payment, you would have to buy insurance on the front end. To help lower your rate, lenders can choose to buy the insurance on the back end to reduce the mortgage default risk if you make a down payment of over 20%. 

If you make a down payment of less than 20% of the property’s value, you would be required to pay mortgage default insurance. 

Amortization Period

If you opt for a more extended amortization period (mortgages with less than 20% down payment have a maximum period of 25 years, while mortgages with down payments of 20% or higher have a maximum period of 30 years), you pay a lower amount as a mortgage payment since it is spread out for a longer period. Generally, the longer you take to pay off your mortgage, the more interest you would have to pay.

Property Usage

Purchasing a home you intend to make your primary residence and live in is considered owner-occupied. If you were purchasing a property you intend to rent to another, or more appropriately, an investment property, you would be saddled with a higher interest rate than your primary residence. This is because lenders rationalize that people prioritize paying the mortgage on their primary residence over a rental property. As a result, lenders tack on some additional risk for rental property rates.

Mortgage Type

Your mortgage rate would also be impacted by your choice of mortgage – such as open vs. closed or variable vs. fixed.

The choice of either option is personal and usually dependent on several factors.

For instance, for open vs. closed mortgages, you should note that open mortgages would feature a higher rate than closed mortgages due to the flexibility that borrowers enjoy since they can choose to pay off their mortgage anytime without a penalty. Similarly, fixed-rate mortgages have steady payments but higher penalties for breaking your mortgage compared to variable-rate mortgages.

Your Credit Score

Borrowers with a credit score of 680 and above are regarded as the ideal candidate for a traditional mortgage lender. The higher above 700 the score is – with a maximum score of 900, the better the chances of getting the best rates.

How Compare Mortgages Works

Our mortgage advisors are usually rewarded based on customer satisfaction with the service rendered. We’re always available to help you reach your goal of owning a home while guiding you through the uneasy home financing process. 

Generally, mortgage professionals who work with borrowers are aware of the best mortgage rates in Saskatchewan. However, only a few will give you that rate without making it a hassle. Here at Compare Mortgages, we are working to change the industry and its ideologies while providing the best rate upfront.

Learn About Rates & Mortgages In Yukon 

Our Frequently Asked Questions (FAQ) section is here to help you make educated decisions on the best mortgage rates in Yukon every time.