1) Cut your car insurance by increasing your deductible.
2) Check into dropping your mortgage insurance if your balance is low enough.
3) If you’re salaried, take your next raise and direct it to an RRSP or other retirement plan.
4) Save for college by having kids earn on their savings,or open a Trust Fund account in their name at your local bank.
5) Spend twenty minutes per week staying up on your financial options.
6) Invest some of your cash in stocks, bonds, or stock mutual funds.
7) If you don’t need it, don’t buy it. If you can’t pay for it, then don’t buy it, and if you don’t understand it, don’t buy it.
8) Analyze your health care plan. You may be driving a Cadillac when a Chevrolet will do.
Showing posts with label mortgage. Show all posts
Showing posts with label mortgage. Show all posts
Thursday, July 30, 2009
Thursday, July 9, 2009
Protect Your Cash
Here are some more great ways to control your finances and keep your cash:
Join a buying club that offers deep discounts. Buy what you need, and have it on hand, saving late night trips to the expensive quick stop shops. How did they ever get by on those wagon trains to California, without a convenience store?
Remember that the Revenue Canada allows you to take a deduction for donations of clothing, furniture, and miscellaneous items. Whatever they would be worth at a thrift shop is a guide. Simply obtain a receipt, and report it on your taxes. You’ll empty the house of cast off items, get more room in your closet, and help someone less fortunate, while lowering your taxes!
Being fit may require joining a health club, but if you joined and don’t go, it’s time to decide, go or quit. As a half step, some clubs offer off peak or alternate day plans that can help cut the fat out of your budget.
Join a buying club that offers deep discounts. Buy what you need, and have it on hand, saving late night trips to the expensive quick stop shops. How did they ever get by on those wagon trains to California, without a convenience store?
Remember that the Revenue Canada allows you to take a deduction for donations of clothing, furniture, and miscellaneous items. Whatever they would be worth at a thrift shop is a guide. Simply obtain a receipt, and report it on your taxes. You’ll empty the house of cast off items, get more room in your closet, and help someone less fortunate, while lowering your taxes!
Being fit may require joining a health club, but if you joined and don’t go, it’s time to decide, go or quit. As a half step, some clubs offer off peak or alternate day plans that can help cut the fat out of your budget.
Thursday, July 2, 2009
Financial Checkup
Look at Money Magazine or other financial publications to get their list of low cost credit cards. Some lower fee and lower interest rate alternatives are available. They’ll help you cut your costs of credit until you can pay off those cards. Some cards carry interest rates in excess of 21%, and require a minimum payment so low that it could take more than 10 years to repay the balance in full. Begin to double your monthly payments on the credit cards with the highest balances.
Open an RRSP or other retirement account to allow you to build your retirement nest egg. If you already have an account, analyze your investments to be sure you’re in the right place for your risk preference, and your goals. An annual checkup is in order.
If only someone had given us a thousand dollars at birth, and we had kept it invested at 12% (high) for 65 years (long time), we could retire a millionaire. It’s true, and it’s not too late. Pick some of these ideas and take action now!
Open an RRSP or other retirement account to allow you to build your retirement nest egg. If you already have an account, analyze your investments to be sure you’re in the right place for your risk preference, and your goals. An annual checkup is in order.
If only someone had given us a thousand dollars at birth, and we had kept it invested at 12% (high) for 65 years (long time), we could retire a millionaire. It’s true, and it’s not too late. Pick some of these ideas and take action now!
Wednesday, July 1, 2009
Sell Your Home or Become a Landlord
Renting your home out may seem like a great alternative to selling at a lower price than expected, but make sure you consider the financial implications.
If the main idea in renting the house is to move now and sell later, be sure to factor in the costs which may occur when reconditioning the rental home for sale as a residence. Chances are the aggravation of converting your home to a rental will exceed any contribution to costs or profits.
Most importantly, keep in mind that being a landlord can be difficult. Tenants will demand that repairs and home maintenance be kept up with in a timely manner. Expenses can be quite substantial, so be prepared with funds to cover them. Feel free to ask me for more information on sales or rental, anytime!
If the main idea in renting the house is to move now and sell later, be sure to factor in the costs which may occur when reconditioning the rental home for sale as a residence. Chances are the aggravation of converting your home to a rental will exceed any contribution to costs or profits.
Most importantly, keep in mind that being a landlord can be difficult. Tenants will demand that repairs and home maintenance be kept up with in a timely manner. Expenses can be quite substantial, so be prepared with funds to cover them. Feel free to ask me for more information on sales or rental, anytime!
Thursday, June 25, 2009
Controling Your Finances with a Plan
For most of us the first step to a bright future is to get control of our finances, and to use a plan to achieve our key objectives. As we get busier, and more transactions are electronic, by mail, by phone, or by ATM, we can lose track of where we are on the financial road map.
This list of suggested activities can help you get back in the seat on the way to your financial destination.
Like a diet requires you keep track of what you eat, in order to cut the fat, you must also track your spending for a month to see where it all goes. This will highlight areas to be targeted for savings.
Create a plan to save 10% off the top of your earnings. “Pay yourself first,” and “part of all I earn is mine to keep,” are key phrases to remind you that you’re entitled to save now for your future.
Put together all your insurance statements and policies and offer them to one or two reputable agents in order to either update coverage, or reduce your costs. Many of us carry too much insurance, in some areas, while we’re dangerously underinsured in others.
Driving a car that is getting older and less valuable, without adjusting your coverage could be an expensive mistake.
This list of suggested activities can help you get back in the seat on the way to your financial destination.
Like a diet requires you keep track of what you eat, in order to cut the fat, you must also track your spending for a month to see where it all goes. This will highlight areas to be targeted for savings.
Create a plan to save 10% off the top of your earnings. “Pay yourself first,” and “part of all I earn is mine to keep,” are key phrases to remind you that you’re entitled to save now for your future.
Put together all your insurance statements and policies and offer them to one or two reputable agents in order to either update coverage, or reduce your costs. Many of us carry too much insurance, in some areas, while we’re dangerously underinsured in others.
Driving a car that is getting older and less valuable, without adjusting your coverage could be an expensive mistake.
Thursday, June 18, 2009
Record Keeping Responsibilities
Here are a few ideas for accounting for the items inside your home, as well as the home itself:
Make a video or photo record and retain receipts for any specific items that are valuable or unique. Remember to add those items, especially jewelry, computer equipment, stereos, etc. to your insurance policy as specifically scheduled items. The additional cost of the insurance is low, and the peace of mind is worth every penny.
You may wish to organize the information about personal property onto a form. This form and the video or photo record will be a perfect partner, if needed, to answer questions in the event of a loss. Organize this information before you experience a loss.
It is important to keep lease or mortgage documents, as well as receipts for all home improvements in a secure place. Improvements are defined as those things which add value, extend the useful life, or adapt to a new use. Replacing a roof, building a fence or deck, or adding a garage are all examples of improvements. By retaining this information you will be able to show future buyers a history of your home.
If you are thinking of adding on to your home, moving up, or moving down, please call us A.S.A.P. Our experience can help you save time and money.
Keeping your important papers, documents and insurance policies in a convenient location, which is known to you, your spouse, and your loved ones, will save time and frustration. You could save thousands of dollars in the event of an emergency, death, or illness.
Here’s a list of the items the organized homeowner should keep together, in a fireproof file cabinet, safe, or strongbox.
· Bank information: Your account numbers, loan documents, statements, and deposits, as well as your most recent canceled checks.
· Car Documents: License, registration, insurance policy, extended warranty, repairs, and other key information.
· Education Records: Official transcripts, report cards, test scores for each student.
· Insurance Policies: Life, homeowners, health, disability, and any others.
· Tax Returns: Revenue Canada suggests you keep your tax returns for three to five years, just in case.
· Official Documents: Birth Certificates, passports, legal papers, deeds, and wills should probably be kept in a safe deposit box.
However, you may wish to keep copies on file at home, with instructions as to their location attached to the file.
Make a video or photo record and retain receipts for any specific items that are valuable or unique. Remember to add those items, especially jewelry, computer equipment, stereos, etc. to your insurance policy as specifically scheduled items. The additional cost of the insurance is low, and the peace of mind is worth every penny.
You may wish to organize the information about personal property onto a form. This form and the video or photo record will be a perfect partner, if needed, to answer questions in the event of a loss. Organize this information before you experience a loss.
It is important to keep lease or mortgage documents, as well as receipts for all home improvements in a secure place. Improvements are defined as those things which add value, extend the useful life, or adapt to a new use. Replacing a roof, building a fence or deck, or adding a garage are all examples of improvements. By retaining this information you will be able to show future buyers a history of your home.
If you are thinking of adding on to your home, moving up, or moving down, please call us A.S.A.P. Our experience can help you save time and money.
Keeping your important papers, documents and insurance policies in a convenient location, which is known to you, your spouse, and your loved ones, will save time and frustration. You could save thousands of dollars in the event of an emergency, death, or illness.
Here’s a list of the items the organized homeowner should keep together, in a fireproof file cabinet, safe, or strongbox.
· Bank information: Your account numbers, loan documents, statements, and deposits, as well as your most recent canceled checks.
· Car Documents: License, registration, insurance policy, extended warranty, repairs, and other key information.
· Education Records: Official transcripts, report cards, test scores for each student.
· Insurance Policies: Life, homeowners, health, disability, and any others.
· Tax Returns: Revenue Canada suggests you keep your tax returns for three to five years, just in case.
· Official Documents: Birth Certificates, passports, legal papers, deeds, and wills should probably be kept in a safe deposit box.
However, you may wish to keep copies on file at home, with instructions as to their location attached to the file.
Thursday, October 2, 2008
Mortgage Payments Can be Deceiving
You see a great home. You pull out your mortgage calculator and start punching in the numbers. The estimated monthly payment is displayed on the screen. You think, “Yep we can afford that!”
Can you?
It’s easy to be seduced by a mortgage payment calculation. However, mortgage payments aren’t the only costs of owning a home. You also need to consider:
Call today for help calculating the true cost of home ownership.
Can you?
It’s easy to be seduced by a mortgage payment calculation. However, mortgage payments aren’t the only costs of owning a home. You also need to consider:
- Property taxes
- Home insurance premiums
- Electricity costs
- Maintenance (especially a factor in older homes.)
- And more
Call today for help calculating the true cost of home ownership.
Friday, September 12, 2008
No Income Mortgages – Self employed and commissioned sales people
For years it was almost impossible for self employed or commissioned sales people to get financing for a home. Problems consists of
1) Onerous and Intrusive demands: Years of financial records, tax returns and other paperwork made it difficult, if not impossible, to get a mortgage.
2) Fluctuating incomes: Canadians with fluctuation incomes were treated as high risk clients and the amount of mortgages they were offered were far below what they could afford to pay or wanted.
3) Not a long enough history: Business owners and commissioned sales people that had not been in business for 3-4 years could not provide the required documents whereas employees need only be at their jobs a few months.
4) Taxable Income Too Low: Many self employed and commissioned sales people write off a portion of their gross income with legitimate tax deductible expenses. This can make their net operating incomes look too low for the lenders. The problem then becomes, "If I write off all my legal expenses so I pay the least amount of income tax, the lenders won’t like my net income, and if I don’t claim all my legal expenses I will have a higher income that the lenders will like, but I will pay unnecessary taxes. Either way I have a problem."
Finally there is an answer, No Income Verification Loans
Due to the highly competitive nature of our mortgage market, there are lenders that offer mortgages specifically designed for self employed and commissioned sales people. These lenders were smart enough to realise that there is a huge need for this type of product considering the high number of self employed and commissioned people in Canada.
No Income Verification loans mean exactly that. They resolve the 4 problems mentioned above.
1) They eliminate most of the documents required making it easier, faster and less intrusive to get a mortgage.
2) Fluctuating incomes from past years are not even looked at.
3) A long business history is not needed as years of financial statements are no longer required. Some lenders like to see that you have been operating for 2 years, but do not need a financial history.
4) Taxable income too low; these mortgages are granted on stated income rather than net taxable income. This allows you to continue to use all legal means possible to reduce your income taxes without hurting the possibility of qualifying for a mortgage.
New products - Bigger mortgages
Up to 90% Financing
As more and more Canadians move from traditional employment jobs to self employed or commissioned jobs, the mortgage market is motivated to develop more products.
Up until recently No Income Verification mortgages were limited to a maximum of 75% of the value of the property. Now that GE insurance has joined the market and provided mortgage default to lenders on No Income Verification loans, we are seeing loans as high as 90% of the value and still with No Income Verification.
Finally, self employed and commissioned sales people are being treated with the respect they deserve, fast and easy approvals and good discounted rates.
Please Call and we would be happy to discuss your options with you.
1) Onerous and Intrusive demands: Years of financial records, tax returns and other paperwork made it difficult, if not impossible, to get a mortgage.
2) Fluctuating incomes: Canadians with fluctuation incomes were treated as high risk clients and the amount of mortgages they were offered were far below what they could afford to pay or wanted.
3) Not a long enough history: Business owners and commissioned sales people that had not been in business for 3-4 years could not provide the required documents whereas employees need only be at their jobs a few months.
4) Taxable Income Too Low: Many self employed and commissioned sales people write off a portion of their gross income with legitimate tax deductible expenses. This can make their net operating incomes look too low for the lenders. The problem then becomes, "If I write off all my legal expenses so I pay the least amount of income tax, the lenders won’t like my net income, and if I don’t claim all my legal expenses I will have a higher income that the lenders will like, but I will pay unnecessary taxes. Either way I have a problem."
Finally there is an answer, No Income Verification Loans
Due to the highly competitive nature of our mortgage market, there are lenders that offer mortgages specifically designed for self employed and commissioned sales people. These lenders were smart enough to realise that there is a huge need for this type of product considering the high number of self employed and commissioned people in Canada.
No Income Verification loans mean exactly that. They resolve the 4 problems mentioned above.
1) They eliminate most of the documents required making it easier, faster and less intrusive to get a mortgage.
2) Fluctuating incomes from past years are not even looked at.
3) A long business history is not needed as years of financial statements are no longer required. Some lenders like to see that you have been operating for 2 years, but do not need a financial history.
4) Taxable income too low; these mortgages are granted on stated income rather than net taxable income. This allows you to continue to use all legal means possible to reduce your income taxes without hurting the possibility of qualifying for a mortgage.
New products - Bigger mortgages
Up to 90% Financing
As more and more Canadians move from traditional employment jobs to self employed or commissioned jobs, the mortgage market is motivated to develop more products.
Up until recently No Income Verification mortgages were limited to a maximum of 75% of the value of the property. Now that GE insurance has joined the market and provided mortgage default to lenders on No Income Verification loans, we are seeing loans as high as 90% of the value and still with No Income Verification.
Finally, self employed and commissioned sales people are being treated with the respect they deserve, fast and easy approvals and good discounted rates.
Please Call and we would be happy to discuss your options with you.
Tuesday, August 19, 2008
Mortgage Information
The Canadian government will guarantee up to 90% of the mortgage amount against insurer default. So, this is security for the lender in the event the insurer defaults. This Government Guarantee is in place for CMHC (Crown Corporation) as well as the private insurers, such as Genworth Financial Canada.
The government guarantee is also a criterion for high ratio loans to be sold into the Canada Mortgage Bond program, which is a relatively new cost-effective funding source for banks and mortgage lending companies. These Bonds are bought up by investors all around the world due to their higher yield than Government of Canada Bonds combined with their “government guarantee”.
So what has changed?
Well, the Finance Minister looked to our southerly neighbours as well as across the pond and noticed some pretty dire scenarios which begged the question: Are we guaranteeing mortgages that are a little too risky? After an analysis of the mortgages that fall within their guarantee, recent trends, and industry consultations, the Minister of Finance decided to cease guaranteeing high ratio mortgages with the following characteristics:
- LTV ratios in excess of 95%
- Amortizations in excess of 35 years
- Non-amortizing mortgages (Interest-Only Mortgages).
- Applications where the beacon score of both borrowers is less than 620.
How does this affect me?
If you are a current homeowner, who is happy in your home and have no intentions of moving in the near future than this probably doesn’t affect you. However if you are a prospective homebuyer, looking for 100% financing and a 40 year amortization then your financing options are becoming a little more limited. Most of the big chartered Banks and many lenders have already pulled the above products. Other lenders, such as MERIX are offering these products until October 13, 2008 (please speak with your mortgage originator concerning rules around this deadline).
Let’s take a closer look at the 40 year amortization phenomenon:
Why is it appealing when borrowers know they are paying many thousands of dollars in interest over the life of their mortgage? Well there are a couple of predominant reasons:
New homeowners are increasingly concerned more with their payment amount than the house price or the interest cost over the life of the mortgage. It’s a decision made largely on cashflow.
The vast majority of people who take 40 year amortizations actually qualify for 25 year amortizations but choose the former and accelerate their payments, which reduce their amortization to 32 years. Registering their mortgage with a 40-year amortization helps protect them in the future should they need to decrease their payment.
From a purely mathematical perspective, according to the Ministry of Finance:
“Reducing amortization from 40 years to 35 years on a mortgage loan of $200,000 with a 6 per cent interest rate results in a $41 increase in a borrower’s monthly payment, but the borrower will save $49,000 in interest payments.”
Looking ahead…
If the decision to take 40 year amortizations is based on cashflow, then we’d suggest $41 per month on its own will not cause any major disruptions in the housing market. The reality is that new mortgagors will have to spend a little more in their monthly mortgage obligations but the impact to the housing market will be isolated to those who needed the 40 year amortizations and 100% financing to qualify for their mortgage. As a replacement for 100% financing, we may see the increase in popularity of Cashback mortgages once again. The 100% financing programs have all but made CashBack offers obsolete, however they may be a decent option for some people once again - even if the interest rate is higher.
In the short term, we may see a small spike in homebuying and refinance activity as people try to accelerate their timelines in order to take advantage of these fleeting offers. This may keep the market relatively strong through 2008. In the medium to long term, we don’t expect these changes to have much of an impact to the housing market. 35 year amortizations are still available and for that matter 40 year amortizations will still be available by some lenders, such as MERIX, for those customers who have the minimum 20% down payment for conventional financing.
The government guarantee is also a criterion for high ratio loans to be sold into the Canada Mortgage Bond program, which is a relatively new cost-effective funding source for banks and mortgage lending companies. These Bonds are bought up by investors all around the world due to their higher yield than Government of Canada Bonds combined with their “government guarantee”.
So what has changed?
Well, the Finance Minister looked to our southerly neighbours as well as across the pond and noticed some pretty dire scenarios which begged the question: Are we guaranteeing mortgages that are a little too risky? After an analysis of the mortgages that fall within their guarantee, recent trends, and industry consultations, the Minister of Finance decided to cease guaranteeing high ratio mortgages with the following characteristics:
- LTV ratios in excess of 95%
- Amortizations in excess of 35 years
- Non-amortizing mortgages (Interest-Only Mortgages).
- Applications where the beacon score of both borrowers is less than 620.
How does this affect me?
If you are a current homeowner, who is happy in your home and have no intentions of moving in the near future than this probably doesn’t affect you. However if you are a prospective homebuyer, looking for 100% financing and a 40 year amortization then your financing options are becoming a little more limited. Most of the big chartered Banks and many lenders have already pulled the above products. Other lenders, such as MERIX are offering these products until October 13, 2008 (please speak with your mortgage originator concerning rules around this deadline).
Let’s take a closer look at the 40 year amortization phenomenon:
Why is it appealing when borrowers know they are paying many thousands of dollars in interest over the life of their mortgage? Well there are a couple of predominant reasons:
New homeowners are increasingly concerned more with their payment amount than the house price or the interest cost over the life of the mortgage. It’s a decision made largely on cashflow.
The vast majority of people who take 40 year amortizations actually qualify for 25 year amortizations but choose the former and accelerate their payments, which reduce their amortization to 32 years. Registering their mortgage with a 40-year amortization helps protect them in the future should they need to decrease their payment.
From a purely mathematical perspective, according to the Ministry of Finance:
“Reducing amortization from 40 years to 35 years on a mortgage loan of $200,000 with a 6 per cent interest rate results in a $41 increase in a borrower’s monthly payment, but the borrower will save $49,000 in interest payments.”
Looking ahead…
If the decision to take 40 year amortizations is based on cashflow, then we’d suggest $41 per month on its own will not cause any major disruptions in the housing market. The reality is that new mortgagors will have to spend a little more in their monthly mortgage obligations but the impact to the housing market will be isolated to those who needed the 40 year amortizations and 100% financing to qualify for their mortgage. As a replacement for 100% financing, we may see the increase in popularity of Cashback mortgages once again. The 100% financing programs have all but made CashBack offers obsolete, however they may be a decent option for some people once again - even if the interest rate is higher.
In the short term, we may see a small spike in homebuying and refinance activity as people try to accelerate their timelines in order to take advantage of these fleeting offers. This may keep the market relatively strong through 2008. In the medium to long term, we don’t expect these changes to have much of an impact to the housing market. 35 year amortizations are still available and for that matter 40 year amortizations will still be available by some lenders, such as MERIX, for those customers who have the minimum 20% down payment for conventional financing.
Friday, July 25, 2008
REFINANCING
Should you break your mortgage for a lower rate?Yes and no. When you break your mortgage contract to renew your mortgage at a new rate and a new term, you're faced with a prepayment charge to reimburse your financial institution for the lost interest income. As a basic rule of thumb, the prepayment charge is based on three months interest or the interest rate differential (that's the difference between you present mortgage rate for the balance of your term and the current rate you want to take out), whichever is greater.
Did you know that most Banks and Lending Institutions offer the worst rate possible when your mortgage comes up for renewal?
In response, you say: "But, they have all my business, they will give me the best rate because I have been with them for years!" -Wrong!
The fact is that each Bank branch acts as a separate profit centre independent of the Head Office. They are rewarded and paid based upon the profitability of their over all mortgage portfolio. They know that most homeowners don't want to go through the hassle of shopping around, and possibly having to re-qualify for their mortgage at a different Bank, so, they offer you a higher rate and hope that you will take it.
Some homeowners are smarter than others, and they negotiate for a better rate. This usual results in a rate that is 0.50 - 0.75% better than what was originally offered in the renewal process. The smartest homeowners call a mortgage broker!
We are able to gain competing offers on your mortgage business and we usually return with a rate that is -1.00 to -1.75% better than your Bank would offer you. That's right, - 1.75% better! This can translate into incredible savings! (See below with only a -1.50% savings)
Imagine saving over $129 per month, and reducing your mortgage by an additional $3,000 in 5 short years!
Here's an example for you to consider:
Bank Renewal Mortgage Mortgage Broker Negotiated Mortgage
Mortgage Principal: $150,000 Mortgage Principal: $150,000
Rate 5 yr Term: 6 % Rate 5 yr Term: 4.50%
Monthly Payment: $959.71 Monthly Payment: $830.21
Savings Monthly: $0 / month Savings Monthly: $129.50
Mortgage Principal at Term end: $134,755 Mortgage Principal at Term end: $131,694
Savings on Principal: $0 Savings on Principal: $3,061 !!!
In addition to a better rate, we can usually tailor fit a mortgage product to your specific needs. We fit a Lender's product to your specific desire to have a flexible mortgage versus a closed mortgage, or a variable term versus a fixed term, etc. We deal with over 30+ Lenders, so options are always available!
Arguably the best reason to use us for your mortgage referral is that we know the secret. Secret you ask? Yes, the secret is that you can secure your mortgage renew up to 120 days before your mortgage actually renews! This often helps you save thousands of dollars in interest. For instance, if your mortgage renews on June 1st, we can secure a new rate for you as early as February 1st. It often happens that rates fluctuate every 60 days, so, you will often be able to get a preferred with us.
Take a moment now, and feel free to contact one of our highly skilled mortgage brokers to help save you money on your renewing mortgage.
Did you know that most Banks and Lending Institutions offer the worst rate possible when your mortgage comes up for renewal?
In response, you say: "But, they have all my business, they will give me the best rate because I have been with them for years!" -Wrong!
The fact is that each Bank branch acts as a separate profit centre independent of the Head Office. They are rewarded and paid based upon the profitability of their over all mortgage portfolio. They know that most homeowners don't want to go through the hassle of shopping around, and possibly having to re-qualify for their mortgage at a different Bank, so, they offer you a higher rate and hope that you will take it.
Some homeowners are smarter than others, and they negotiate for a better rate. This usual results in a rate that is 0.50 - 0.75% better than what was originally offered in the renewal process. The smartest homeowners call a mortgage broker!
We are able to gain competing offers on your mortgage business and we usually return with a rate that is -1.00 to -1.75% better than your Bank would offer you. That's right, - 1.75% better! This can translate into incredible savings! (See below with only a -1.50% savings)
Imagine saving over $129 per month, and reducing your mortgage by an additional $3,000 in 5 short years!
Here's an example for you to consider:
Bank Renewal Mortgage Mortgage Broker Negotiated Mortgage
Mortgage Principal: $150,000 Mortgage Principal: $150,000
Rate 5 yr Term: 6 % Rate 5 yr Term: 4.50%
Monthly Payment: $959.71 Monthly Payment: $830.21
Savings Monthly: $0 / month Savings Monthly: $129.50
Mortgage Principal at Term end: $134,755 Mortgage Principal at Term end: $131,694
Savings on Principal: $0 Savings on Principal: $3,061 !!!
In addition to a better rate, we can usually tailor fit a mortgage product to your specific needs. We fit a Lender's product to your specific desire to have a flexible mortgage versus a closed mortgage, or a variable term versus a fixed term, etc. We deal with over 30+ Lenders, so options are always available!
Arguably the best reason to use us for your mortgage referral is that we know the secret. Secret you ask? Yes, the secret is that you can secure your mortgage renew up to 120 days before your mortgage actually renews! This often helps you save thousands of dollars in interest. For instance, if your mortgage renews on June 1st, we can secure a new rate for you as early as February 1st. It often happens that rates fluctuate every 60 days, so, you will often be able to get a preferred with us.
Take a moment now, and feel free to contact one of our highly skilled mortgage brokers to help save you money on your renewing mortgage.
Friday, July 18, 2008
Pre-approved Mortgage
A pre-approved mortgage certificate is a written commitment, by a lender, that you will get a mortgage for a set amount of money, at a specific rate of interest that is guaranteed for a set period of days. The commitment is made subject to a property assessment. The service is free and without obligation.
A pre-approved mortgage gives you an edge. Before you even go house hunting, you will know the size of your mortgage, the interest rate, and the size of your monthly mortgage payments. With your financing already mapped out, you can concentrate on finding the right home in your price range. A pre-approved mortgage also puts you in a strong bargaining position when you make an Offer to Purchase. If the seller wants to make a quick sale, you may be able to negotiate a price lower than the list price, because the seller knows that you are a serious buyer. On the other hand, if several people are bidding on the home you want, you may decide to offer to purchase at the list price, to beat out earlier offers.
This also lets the realtor no that you are a serious buyer. There is no point for the realtor showing you homes out of your price range.
Shopping for a Home
You are ready to go shopping if you have:
Set aside money for your down payment and additional costs
Determined the price of home you can afford
Investigated your mortgage options
Your pre-approved mortgage certificate
http://www.expertmortgages.ca/
Allyson Foulis, Laura Reaney, Maureen Haslehurst, AMP Brokers
Jennifer Robinson, Cheryl Leukefeld, Katharine Creery
office 250-727-7746
fax 250-721-5924
A pre-approved mortgage gives you an edge. Before you even go house hunting, you will know the size of your mortgage, the interest rate, and the size of your monthly mortgage payments. With your financing already mapped out, you can concentrate on finding the right home in your price range. A pre-approved mortgage also puts you in a strong bargaining position when you make an Offer to Purchase. If the seller wants to make a quick sale, you may be able to negotiate a price lower than the list price, because the seller knows that you are a serious buyer. On the other hand, if several people are bidding on the home you want, you may decide to offer to purchase at the list price, to beat out earlier offers.
This also lets the realtor no that you are a serious buyer. There is no point for the realtor showing you homes out of your price range.
Shopping for a Home
You are ready to go shopping if you have:
Set aside money for your down payment and additional costs
Determined the price of home you can afford
Investigated your mortgage options
Your pre-approved mortgage certificate
http://www.expertmortgages.ca/
Allyson Foulis, Laura Reaney, Maureen Haslehurst, AMP Brokers
Jennifer Robinson, Cheryl Leukefeld, Katharine Creery
office 250-727-7746
fax 250-721-5924
Thursday, July 17, 2008
Why You Should Order Your Own Credit Report
“I don’t have a problem with credit’” a potential new home buyer says. “I pay my bills on time. I never have trouble getting a loan.”
That may be true. However, according to several surveys, most people are surprised by at least one piece of information in their credit report. And it only takes one derogatory item to create an obstacle to getting the lowest mortgage rate possible, or even getting a mortgage rate possible, or even getting a mortgage at all.
That’s why it’s important to check your credit report before you shop for a new home. You will then have the opportunity to deal with any unexpected issues.
For example, you may discover an error. (This isn’t unusual) If you do find there is a mistake in your credit report, inform the credit bureau immediately. They are required, bylaw, to promptly make a correction.
If there are late payments noted on your credit report, you can write a letter of explanation to the credit bureau telling your side of the story. This will accompany the credit information that goes to your lender. Assuming everything else in your credit report is fairly good, most lenders will accept a reasonable explanation for late payments, such as being laid off from a job, an extended illness in the family, or military service overseas.
How do you get your credit report?
All have websites that allow you to order your credit report for a reasonable fee. It’s a good idea to order all tree credit reports as not all companies report credit information to all three bureaus.
Getting your credit report, and checking that it’s accurate, will make the home buying process go a lot more smoothly.
That may be true. However, according to several surveys, most people are surprised by at least one piece of information in their credit report. And it only takes one derogatory item to create an obstacle to getting the lowest mortgage rate possible, or even getting a mortgage rate possible, or even getting a mortgage at all.
That’s why it’s important to check your credit report before you shop for a new home. You will then have the opportunity to deal with any unexpected issues.
For example, you may discover an error. (This isn’t unusual) If you do find there is a mistake in your credit report, inform the credit bureau immediately. They are required, bylaw, to promptly make a correction.
If there are late payments noted on your credit report, you can write a letter of explanation to the credit bureau telling your side of the story. This will accompany the credit information that goes to your lender. Assuming everything else in your credit report is fairly good, most lenders will accept a reasonable explanation for late payments, such as being laid off from a job, an extended illness in the family, or military service overseas.
How do you get your credit report?
There are three major credit bureaus in North America:
- Equifax (www.equifax.com)
- Trans Union (www.transunion.com)
- Experian (www.experian.com)
All have websites that allow you to order your credit report for a reasonable fee. It’s a good idea to order all tree credit reports as not all companies report credit information to all three bureaus.
Getting your credit report, and checking that it’s accurate, will make the home buying process go a lot more smoothly.
Friday, July 11, 2008
Ottawa revamps mortgage rules
KEVIN CARMICHAEL
Globe and Mail Update, Reuters
July 9, 2008 at 4:36 PM EDT
OTTAWA — The federal government says it will no longer guarantee 40-year mortgages, one of a handful of measures aimed at guarding against a U.S.-style housing bubble.
The Finance Department said Wednesday in a news release that the government will guarantee no mortgages with durations longer than 35 years. The government also will demand a minimum down payment equal to 5 per cent of the value of the home.
“Today's announcement marks a responsible and measured approach by the government to ensure Canada's housing market remains strong and to reduce the risk of a U.S.-style housing bubble developing in Canada,” the Finance Department said.
The government hastened to emphasize that Canada's housing and mortgage markets were performing much better than in the United States.
Canadian housing prices are in line with economic factors such as low interest rates, rising incomes and a growing population and the demand for residential housing remains buoyant at more than 200,000 housing starts a year, it said.
The percentage of bank mortgages in arrears is also stable at 0.27 per cent, the lowest levels experienced since 1990 and well below the highs of 0.65 per cent in 1992 and 1997.
“The historically prudent and cautious approach taken by Canadian financial institutions to mortgage lending, combined with a sound supervisory regime, has allowed Canada to maintain strong and secure housing and mortgage markets,” it said.
It nonetheless noted “accelerated financial innovation” in the mortgage markets since the fall of 2006, for example, allowing loans up to 100 per cent of the value of the house and increasing amortization periods to 40 years from 25 years.
The government will now require a consistent credit score for mortgages it backs, and a minimum level of loan documentation standards to ensure evidence of the reasonableness of property values and the borrowers' income.
In addition, government guarantees will not be allowed for high-ratio mortgages where amortization is not required in the first few years – e.g., mortgages that begin with interest-only payments.
Finally, it will set a maximum of 45 per cent on a borrower's debt-service ratio – the proportion of gross income that is spent on debt service and housing-related fixed or essential payments.
Globe and Mail Update, Reuters
July 9, 2008 at 4:36 PM EDT
OTTAWA — The federal government says it will no longer guarantee 40-year mortgages, one of a handful of measures aimed at guarding against a U.S.-style housing bubble.
The Finance Department said Wednesday in a news release that the government will guarantee no mortgages with durations longer than 35 years. The government also will demand a minimum down payment equal to 5 per cent of the value of the home.
“Today's announcement marks a responsible and measured approach by the government to ensure Canada's housing market remains strong and to reduce the risk of a U.S.-style housing bubble developing in Canada,” the Finance Department said.
The government hastened to emphasize that Canada's housing and mortgage markets were performing much better than in the United States.
Canadian housing prices are in line with economic factors such as low interest rates, rising incomes and a growing population and the demand for residential housing remains buoyant at more than 200,000 housing starts a year, it said.
The percentage of bank mortgages in arrears is also stable at 0.27 per cent, the lowest levels experienced since 1990 and well below the highs of 0.65 per cent in 1992 and 1997.
“The historically prudent and cautious approach taken by Canadian financial institutions to mortgage lending, combined with a sound supervisory regime, has allowed Canada to maintain strong and secure housing and mortgage markets,” it said.
It nonetheless noted “accelerated financial innovation” in the mortgage markets since the fall of 2006, for example, allowing loans up to 100 per cent of the value of the house and increasing amortization periods to 40 years from 25 years.
The government will now require a consistent credit score for mortgages it backs, and a minimum level of loan documentation standards to ensure evidence of the reasonableness of property values and the borrowers' income.
In addition, government guarantees will not be allowed for high-ratio mortgages where amortization is not required in the first few years – e.g., mortgages that begin with interest-only payments.
Finally, it will set a maximum of 45 per cent on a borrower's debt-service ratio – the proportion of gross income that is spent on debt service and housing-related fixed or essential payments.
Thursday, June 26, 2008
What does a lender look for?
Most lenders look at the five "Cs" of credit before approving a mortgage.
CHARACTER is a reflection of your stability and willingness to repay credit obligations. Have you used credit before and paid it back on time? Is your application completed accurately and honestly? Have you moved or changed jobs often?
CAPASITY is a look at your earning power, current income, and credit commitments. Can you really afford a loan now?
CAPITAL is your net worth (the difference between what is yours, free and clear, and your debts). This includes an in-depth look at your total financial situation, including the value of your home and other assets.
COLLATERAL is an item of value you own that can be promised to the lender. If you don't repay your loan, the lender has the right to take your collateral. By pledging collateral, you can sometimes get a large loan or lower interest rate - that's because you're more likely to pay back the loan when something you value is at stake, so the lender may be taking a smaller risk.
CONDITIONS include the national and local economic picture. Are there lots of layoffs or are employers hiring more people?
Allyson Foulis 746-5924
Cheryl Leukefeld 701-3978
CHARACTER is a reflection of your stability and willingness to repay credit obligations. Have you used credit before and paid it back on time? Is your application completed accurately and honestly? Have you moved or changed jobs often?
CAPASITY is a look at your earning power, current income, and credit commitments. Can you really afford a loan now?
CAPITAL is your net worth (the difference between what is yours, free and clear, and your debts). This includes an in-depth look at your total financial situation, including the value of your home and other assets.
COLLATERAL is an item of value you own that can be promised to the lender. If you don't repay your loan, the lender has the right to take your collateral. By pledging collateral, you can sometimes get a large loan or lower interest rate - that's because you're more likely to pay back the loan when something you value is at stake, so the lender may be taking a smaller risk.
CONDITIONS include the national and local economic picture. Are there lots of layoffs or are employers hiring more people?
Allyson Foulis 746-5924
Cheryl Leukefeld 701-3978
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