Mortgages Made Easy Blog

Our brokers post interesting news, tips, and industry updates every week.
JUN
28

How to avoid the hidden trap of mortgage penalties

How to avoid the hidden trap of mortgage penalties

Every mortgage shopper wants the lowest mortgage rate possible, but be careful; sometimes a low rate comes with unrealistic terms and conditions, or potential future penalties and fees that could nullify your initial savings.

I recently read in the news about a Toronto man who had to shell out $13,000 in fees for breaking his mortgage contract early. Nadim Kara didn’t know homeowners with a fixed term longer than five years can only be charged a penalty of three months’ interest if they break their mortgage after the fifth year. If Nadim had waited 60 more days to break his contract, he would have paid $3000 in fees rather than $13,000. This pertinent information was not in his contract, or explained to him until after the fact.

This story is an example of why having an experienced mortgage broker on your side is so important. Brokers take a forensic approach to examining the details of your mortgage contract to ensure you are protected, and that includes checking that the contract isn’t missing any information. Mortgage contracts must disclose all information on penalties for ending a mortgage early and how they will be calculated. Our brokers have been around the block a few times and won’t let mistakes fall through the cracks.

Many homebuyers can be overwhelmed by the technical language in mortgage contracts and may not pay close enough attention to the details before signing the dotted line. Our brokers are here to answer your questions and explain the fine print, so you don’t have to worry about overpaying on your mortgage, or being taken advantage of later.

We’ve been helping our clients navigate the mortgage industry since 1989. Give us a call at 613-563-3447 and let us take the confusion out of planning your mortgage.

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347 Hits
MAY
09

Is a CHIP Reverse Mortgage Right For You?

Is a CHIP Reverse Mortgage Right For You?

If you are a homeowner, 55 or older, and considering selling your home or downsizing, you should know there are other options available. One such option is a CHIP Reverse Mortgage. 

What is a reverse mortgage?

A reverse mortgage is a home loan that gives owners access to their home equity and turns it into tax-free money for you to spend as you wish. Instead of selling or downsizing to save money for your future, you can keep the home you love. 

How does a reverse mortgage benefit me?

A reverse mortgage allows you to receive up to 55% of the value of your home (depending on your age, type of home and location). The money from a reverse mortgage can supplement monthly income and help you enjoy your retirement or cover expenses, without dipping into your savings. With a reverse mortgage, you can avoid taking out a line of credit. Any outstanding loans will be paid out by the proceeds from your reverse mortgage.

Also, as long as you live in your home, you won’t have any regular mortgage payments. You retain ownership and control of the house and will never be asked to leave or sell (as long as you pay taxes, insurance and maintain the property).

Homeowners can receive the money in three ways:

• As one lump sum in advance

• Some now and some later

• Planned advances over a set period of time

Finally, once the CHIP Reverse Mortgage is repaid, you keep the remaining equity on your home. On average, the amount left over is 50% of its value when sold. 

Call one of our mortgage brokers today to find out if a CHIP Reverse Mortgage is right for you.

 

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561 Hits
JAN
09

The rules have changed, so you better have your credit story straight.

Know the rules

The recent mortgage rule changes in Canada have been all over the news. In short, it’s tougher to get a mortgage today than it was just a few weeks ago. That doesn’t mean you can’t get a mortgage, but it does mean that you need to be really well prepared before you go shopping. When the rules tighten up, presenting yourself in your very best light can go a long way to increasing your options. One brilliant way to make a great impression on a lender is to have your credit story in order.


One thing that becomes an Achilles heel for a lot of borrowers is their credit score – and that even holds true for borrowers with really high incomes. You would be amazed how much weight your credit score carries. So, before you go for pre-approval, here are some sure-fire steps you can take to put the odds in your favour.

Find out where you stand, not where you hope you stand.

Your credit report can be had for free. It’s the same report that lenders will reference when they assess your credit-worthiness as far as them lending you their money. Good, bad or ugly, your journey starts with a review of your credit score, because the truth will set you free. The last thing you want is to be turned down over a bad report or even an error in your report. You’d be surprised how few times people actually go into their report and clear out long out of date information that could be hurting their credit rating. The more accurate the report, the faster you’ll know where you stand.

Be obsessed with paying your bills on time

This is hugely important to your credit health. Pay your bills on time. By on time, I mean in time for the payment to be received and processed before the due date so that your payment is registered on time, not submitted on the day it is due. And if you can’t pay the full bill, pay your minimum balance. If you do, you’ll be rewarded in your credit report.

And if you’re in a short-term jam and can’t make ends meet one month, call your creditor immediately, in advance of the payment due date and explain the situation.  Great communication with your creditor can also prevent a late payment form being reported to the credit bureau and repayment reliability is the single biggest influencer on your credit score. 

Are you a first time buyer? Build your credit score now.

New buyers often think that they stand a better chance at getting a mortgage if they don’t have credit cards of a history of debt. Sorry, but that’s not true.

When you don’t have any credit record, lenders can get leery. Lenders actually love seeing a healthy record of borrowing and repaying on time, as per agreement. It tells them that you have experience and you can handle the obligations that come with borrowing money. Being able to own and manage a credit card and also stay within your limit gives you a green light with lenders.  Of course, there are essential strategies that need to be employed, and simply running a credit card to the limit then only making months of the minimum payment won’t actually be great for your score. Remember, whether it’s a credit card bill, or your Internet and cable bill, paying them on time every time sets you up for mortgage success.

And here’s a tip no one usually knows: If you have more than one credit card or an old card you no longer use, don’t close the account. Having an active card that you don’t use also sends the message that you don’t use credit for the sake of using credit and lenders like seeing that too. It’s all a test and sticking to a simple payment plan can yield great scores in ways most people could never imagine,  

Lay off that “fist full of cards”

Opening multiple credit cards at the same time as you plan to seek a mortgage can also send a bad signal to a lender. You might think being approved for several credit cards at once is a sign of credit worthiness, but a mortgage lender looks at it differently. The mortgage lender sees a red flag as they assume you need these to pay bills and make ends meet regularly. That’s an instant stress test when it comes to assessing your ability to repay your mortgage with a lot of high interest debt on your plate. Once again, having a couple of cards that you manage well is fine, having a wallet full of high interest debt, is not.

Stay in touch with your credit report

We help our clients devise and execute many more credit strategies – all aimed at improving their ability to borrow for a mortgage at the best rate. One thing we always tell clients: now that you’re armed with credit IQ, make sure you occasionally check in on your credit report. It keeps you completely current on your most important asset when searching for a mortgage (or anything else of high net worth): your credit worthiness.

Pick an expert’s brain, for free

Ok, so I’ve just shared some sound advice about how to give you a better mortgage experience by building credit score.  But we’ve got plenty more ideas and strategies available, if you really want to supercharge your credit story. Trouble is – and stats will bear me out on this one – most of us need help to understand our situation and what the best way to improve it is. We’ve been helping clients secure mortgages and get their credit house in order for more that 30 years, and we can help you. It costs nothing to get our opinion and our quick form is effortless and completely confidential. The rules have changed and more than ever, today someone should be looking out for your interests. We’re happy to take on that challenge.

Looking for a mortgage? Wondering if you qualify? Interested in refinancing? Our secure and completely confidential “no obligation” quick-form can give you answers, fast. Find it here.

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1255 Hits
DEC
12

Canada’s new mortgage rules: who’s looking out for your interests now?

Canada Mortgage and Housing Corporation logo

Recently, the CEO of the Canadian Mortgage and Housing Corporation stated they would issue a “red level” warning for the Canadian housing market. 

In case you’re wondering, a “red level” warning indicates evidence of problematic conditions in the housing market and is primarily based on 4 factors: 

  • Overheated demand, which is marked by the number of houses for sale being greater than number of new listings
  • Accelerating rise in house prices
  • The overvaluation of homes as reflected in prices that are not justified by income, mortgage rates and population
  • Overbuilding of new homes

What does it mean for you as you prepare to get a mortgage? Well, like most things, there is more than one theory about the warning, who it might effect and how.

Some economists, knowing the economy is moving forward and a housing slowdown is already in the works, feel that this warning may really be about slowing down Vancouver’s out-of-control property run and influencing federal policy around housing.

In our opinion, the warning won’t have much impact on buyers, but once again, the new mortgage rules (and coming rule changes) will definitely impact buyers in regards to the new “repayment stress tests” that borrowers will be facing for new mortgages. This could significantly impact first time buyers in the market.

In simple terms, if you are a new buyer with less than 20% down payment, you’ll most likely be approved for less home ownership.

Of course, there are still many excellent options out there, as long as you know how to access them - even for first time buyers.

If you’re trying to get yourself approved for a new mortgage under the new rules, there may never be a more profitable or more valuable time to put a great mortgage broker to work on finding you the best solution out there.

Think about it: Ottawa Carleton Mortgages currently works directly with more than 20 quality lenders, including banks as well as some of the leading “non-big-bank” mortgage lenders in Canada. Nothing works better for you than having lenders compete for your business.  Add in the unimpeachable guidance of a 30+ year proven track record and there is simply no way you can get yourself the same options and advantages on your own.

The government and the big banks are not motivated to help you succeed in your mortgage quest, but we are, and I guarantee it. Put us to the test today and see just how much mortgage you can actually get for yourself.

It’s your money, so make them work for it. We’ll help you do that.

Looking for a mortgage? Wondering if you qualify? Interested in refinancing? Our secure and completely confidential “no obligation” quick-form can give you answers, fast. Find it here.

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960 Hits
OCT
20

Canada’s new Mortgage Rules: A message to First Time Home Buyers 

New mortgage rules

Canada’s new mortgage rules came into effect this week. The bottom line is that they make it more difficult for anyone seeking a new mortgage, trying to buy a rental property, looking to transfer a mortgage or seeking to renew an existing mortgage.

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1093 Hits
SEP
20

It’s a Great Day to Refinance

Refinance mortgage application form

As the Globe and Mail (and countless other Canadian news outlets) have recently reported, the ratio of Canadian household debt to disposable income has hit a new record high. Statistics Canada says that, on average, households hold $1.65 in debt for every dollar of disposable income. As is always the case, a lot of that new debt comes in the form of mortgages, but consumer credit is also at an all time high.


So what now? Well, if your mortgage rate is greater than 3% or if you’re looking to manage high interest credit debt at much lower rates, this just might be the best time in our history to refinance.

It’s a Great Day to Refinance

Mortgages are at record-lows today, but if you’re paying into a 5-year fixed rate mortgage and still have a few years left on the mortgage, you might not be feeling so great. You might want to explore the possibilities of a new mortgage, because it could save you a bundle – especially if you have enough equity to let you eliminate some high interest personal debt you might be carrying.

Of course, every situation is unique so do your research.  Before you refinance you’ll need to be sure that the savings you’ll gain will trump any penalties connected with breaking an existing mortgage.  A good mortgage broker can easily give you the answers you seek.

Leverage your home equity

Housing prices continue to rise everywhere, so you may have more equity in your home than you think you do. That’s important because it can change your ratios, and give you more borrowing power, which opens up all kinds of new opportunities. Just imagine repackaging high interest debt or paying off a credit line or starting that major renovation or taking that trip you’ve always dreamed of. If you find yourself house rich and cash poor, borrowing money at today’s incredibly low interest rates could change your world.

Consolidate your high-interest debt

I touched on it above, but if you find yourself fighting off high interest debtors, debt consolidation can solve your personal debt situation while letting you keep your home. When you roll your existing debt into a single low interest loan, your life greatly improves. Knocking your high credit score down to low single digit interest rates means your new mortgage pays off your existing debts and you get a clean start. And once again, you get to keep your home.

Do the real math on mortgage penalties

The simple truth is that if you have a closed mortgage, you’ll have to pay a penalty to escape your existing deal with your bank. If you have a variable rate mortgage, the formula is simple: It will cost you three months’ interest on the existing mortgage. If your current mortgage rate is fixed, you’ll have either pay three months’ interest or something called the Interest Rate Differential (IRD); whichever is higher. Interest Rate Differential can be scary in some instances, so make certain you and your mortgage broker do the real math for your current mortgage to make certain that refinancing makes sense in your situation. What’s the point if it’s going to cost you money instead of saving you?

It’s pretty clear: today could be a great day to refinance.

Get started & give us a call.

Looking for a mortgage? Wondering if you qualify? Interested in refinancing? Our secure and completely confidential “no obligation” quick-form can give you answers, fast. Find it here.

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997 Hits
AUG
15

How to crush your mortgage debt

Crush mortgage debt

Paying off your mortgage early isn’t easy, but it’s certainly worth it.

Of course, tightening up your spending belt is a core tactic for freeing yourself from mortgage debt, but it’s not the only way. There are other tricks that won’t cost you a dime but will save you a ton. Here’s some foolproof guidance.

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1269 Hits
JUN
30

The Best Mortgage Is NO Mortgage

Debt free just ahead

Getting Started

There is GOOD & BAD credit debt, as I used to tell my two kids when they were teenagers.  When I got them their first credit cards they were aghast.  “Dad you’ve told us that debt is bad.” I clarified by stating that there is GOOD debt, such as mortgage debt on your home, and BAD debt, such as paying high interest rates on credit cards.  In order to qualify to borrow for GOOD debt and owning your own home, you need to have a plan and discipline. Having two credit cards & using them properly is a great strategy to achieve the goal of home ownership.


 

The Plan

To obtain a prime mortgage for your home requires good credit, a minimum credit score of 650-680 points is required. Using two credit cards for at least 2 years and paying them properly will help make this happen. You must have credit cards to create a good credit score. Not having a credit score will cause you to be declined for prime mortgage terms & rates! Paying your credit card debt in full on or before the due dates is the best plan.  You get to use the banker’s money for approximately 45 days without paying any interest!  And you’re not paying the monthly minimum payments with the 9% -20% interest rates!  This allows you to put some savings away for the down payment on your new home. Of course, you can pay the minimum payment every month with the high interest charges and still have a good credit score.  It’s just a dreadful financial plan that can lead you to the abyss. (See other blogs on credit).

The Best Mortgage Is No Mortgage

I’ve said this for many years when I’m asked what the best mortgage is; my answer is always the same, NO MORTGAGE.  People always say that’s impossible and for the majority this is the true, not because of the mortgage amount but because they didn’t have a plan. But for those that have discipline and the right plan it’s not only possible- it’s a guarantee.

You must have a plan to pay the mortgage BEFORE the amortization time, which is usually 25-30 years.  You can’t do this without the right plan or discipline.  The plan is simple and guaranteed to work; all mortgages allow you to prepay lump sum payments as well as increasing your payments.   As much as 20% can be increased in payments or lump sums deposits. I know, you are wondering where can you find that extra cash?  Prepaying even 10% on a $250,000.00 mortgage will set you back $25,000.00! This for most people is too much but what about $1,000.00 each year, or an increase in your payment by $20-$25.00?  Most people can find a way for these small amounts.  And if you do this, I guarantee even the small amounts add up to the point you will have your mortgage paid in full many, many years ahead of schedule.  In addition, taking even a slightly shorter amortization period will not increase your payment by very much but save you thousands of dollars in mortgage interest.

We can help you with your mortgage plan and show you the proof and the savings of what these smaller amounts can do. The savings of interest & the quickness of your mortgage balance dropping are amazing and improve each month and year. And seeing this in print is a huge motivator.

Get started & give us a call.

Looking for a mortgage? Wondering if you qualify? Interested in refinancing? Our secure and completely confidential “no obligation” quick-form can give you answers, fast. Find it here.

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1223 Hits
JUN
07

Purchase-Plus Improvement Mortgage

Couple planning home layout

With summer off to a great start, this is no doubt the most hectic time of the year for real estate agents and mortgage brokers.  The busiest closing months for new purchases are at the end of June and July.  The great weather during the preceding months makes it very easy for clients to list and show off their homes for sale.  With the increased number of homes listed and so many potential purchasers competing for properties, it can be difficult for clients to find their dream home with all their desired features. This is where our PURCHASE-PLUS IMPROVEMENT MORTGAGE can be very beneficial.

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1262 Hits
MAY
18

Credit score has a huge impact on your financial health

Checking credit score

When it comes to mortgages, your credit score can be the difference between getting a good mortgage rate and qualifying for a mortgage at all.

As a mortgage and finance professional, it’s my job to guide you through some simple, yet important steps to help you get your credit score right where it needs it to be so you can realize your mortgage goals and dreams.


 

Five key factors

Credit scores can range for a low of 300 to a high of 850. The higher the numbers, the more loan-worthy you become to lenders.

Up to 1 in 8 people applying for a mortgage may not qualify because their credit score is between 500 and 600. Here’s a simple chart that let’s you know how mortgage underwriters assess applicants:

720 and over

Terrific - Best Rates and Terms offered to you

700-719

Excellent - High Value Borrower

680-699

Good - In good position to purchase

660-679

OK - Wouldn't receive exceptions to policies

640-659

Borderline - Ok if strong in other factors

620-639

Weak - File would need to be perfect

600-619

Difficult - will need work or a special program

Below 600

Trouble! - you will need to fix your credit

 

Scores are determined using 5 factors...

  • Payment History accounts for 35% of your score. Late payments have a negative effect and missing a big payment hurts your score more than missing a small payment.
  • Outstanding credit balances also account for 35% of your score.  Keeping your credit card balance below 70% of your available limit will make a positive difference in your credit score.
  • Your credit history accounts for 15% of your score.  An experienced borrower often scores better than a brand new borrower.
  • The type of credit you owe accounts for 10% of your score.  A mix of credit cards, auto loans and mortgages is better for your score than a high concentration of credit card debt.
  • The number of inquiries made about your credit history accounts for 10% of your score. Each formal inquiry can cost 2-50 points on your score, so if you apply for a lot of credit, it can negatively impact your score. 

Here’s a tip

I’m an expert at helping my clients employ debt strategies that can help improve their credit score. Here’s just one example:

When a credit report is run, it’s simply that day’s snapshot of your credit profile.  If you get approved for a mortgage, you need to be sure to stay very responsible with your spending. If you were to decide to go on a major shopping spree after you qualified for your mortgage and as a result, increased your credit burden, you could change your debt ratios and find you’re no longer qualified for that mortgage. 

If you’d like more information or help on maximizing your credit score, just drop me a line or email me.

Looking for a mortgage? Wondering if you qualify? Interested in refinancing? Our secure and completely confidential “no obligation” quick-form can give you answers, fast. Find it here.

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1238 Hits
APR
14

How's your plan working?

Plan, act, evaluate, improve

It’s been said before, but there’s never been a better time to get a mortgage. Rates today continue to be historically low, which means you’ll never be able to buy more home than you can now.

Of course, a mortgage is simply a low interest secured debt and as such, should really be entered into with some sort of long term plan that goes beyond getting the mortgage approved. If you have a home buying plan, great. If you don’t, here are some things to consider.


 

A mortgage without a plan is like a gym membership without a plan.

Well, actually there’s one difference; one costs a heck of a lot more than the other. That aside, the lesson is that without a mortgage plan, your success could be limited.

Every mortgage client wants the lowest rate available and everyone in the mortgage lending space knows exactly who’s offering what rates, so there are no surprises there.

But beyond searching for a great rate, you still need a plan to ensure that allows you to take full advantage of the potential a great mortgage offers you.

Your goals are unique. Your mortgage should custom-fit your goals.

Again, it’s essential that you understand your situation, how to reach your goals and what mortgage details and terms will serve you best. The best way to get those answers is to research more than one perspective, and that must include asking a mortgage professional for their opinion. It can only help you make a great decision, so take the time and do this right.

Track records matter

You’re probably going to own your home for a long time, it might be wise to talk with people who have succeeded helping others over a long period of time. Why? Well, this is the biggest financial commitment most of us make and having the peace of mind that comes with a proven track record is really worth its weight in savings. It’s nice to know that when you pick up the phone that the person you dealt with picks it up on the other end. That accountability is critical to your long-term mortgage success, and that’s our stock-in-trade.

Be brutally honest with yourself: If your plan isn’t working, get a new plan

Many mortgage clients are smartly folding their high interest debt into their new mortgage, which is obviously a brilliant way to stop the big interest wheel form churning relentlessly.

That’s a great way to start down a new path, but you also need to make changes in your life so that you can capitalize on this new easier, lower payment so that you don’t simply fall right back into high interest spending.

We’re experts at helping our clients link their new mortgage to their goals – not just for the moment, but for the years ahead as well. We may sound obsessive about linking your mortgage to a better financial future for yourself, but the truth is that when this is done right, many of our home owner clients experience the kind of freedom and control that they never thought they could, and that can be life changing. If your current plan isn't getting you where you need to be, you owe it to yourself to drop us a line and drop in for a chat. There’s no obligation and the very worst you can do is leave with a greater understanding of what it’s going to take to get you where you want to go with your next mortgage.

Many can offer a mortgage rate, but few will share what we will with you.

We specialize in “mortgages made easy”, and we’ll show you just how easy.

Looking for a mortgage? Wondering if you qualify? Interested in refinancing? Our secure and completely confidential “no obligation” quick-form can give you answers, fast. Find it here.

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1102 Hits
APR
14

We've been where you are

Compass laying on mortgage rate charts

The mortgage landscape is changing. Fast. A simple Google search will tell you that. Of course, getting approval for a mortgage and just as importantly, getting approved for the best mortgage for your set of circumstances may not be nearly as straightforward. Mortgages are exceptional financial tools that are tied to the biggest decisions most of us ever make: buying a home. Of course getting a great mortgage isn’t a one-time decision, as most homeowners renew that commitment every 3-5 years. And no matter whether it’s your first home purchase, your 4th home purchase, or you’re simply looking to eliminate high interest debts through a mortgage renewal, it’s crucial to do your homework. As we always say, the devil is in the details and the only great mortgage is a mortgage that’s great for you.


 

No matter what your situation, we've been through it and the folks we've helped have been through it, and that experience is what really makes us a great choice for you.

I started this company a long time ago and I can tell you I’ve personally seen the highest highs and the lowest lows. I went from the penthouse to almost wiped out in the mortgage crash in the 80’s. It wasn’t pleasant, it wasn’t easy, but it was entirely fixable. Because of my deep hands-on experience in finance and mortgages, I made tough decisions and executed a financial plan that allowed me to rebuild myself into a stronger person and a better businessman.

So why should you care?

The advice and guidance we offer is proven. Beyond getting the best mortgage rates in the market, the advice and guidance we offer is simply not taught in books. Between what we've experienced and the thousands of clients we've helped, we've been where you are and we have solutions for your goals and dreams.

Looking to eliminate high interest debt? We've been there. Got decent credit and looking for the best options that reward your hard work and responsibility? We have some superb options for you. Are you a first time homebuyer? We've all been there. Rebuilding or protecting your assets after a break up? We've helped hundreds in the same situation.

There is no financial situation we haven’t seen or found solutions to. That's the difference with a company like ours. Getting a great rate is simply table stakes. The starting point. Getting the perfect plan for you? Well that’s something entirely different. Your situation and goals are entirely unique to you so your solution should be too. Our experience and generosity are anything but cookie cutter.

When we promise you “mortgages made easy”, we mean it.

Looking for a mortgage? Wondering if you qualify? Interested in refinancing? Our secure and completely confidential “no obligation” quick-form can give you answers, fast. Find it here.

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1224 Hits
MAR
21

I love Variable Rate Mortgages

Couple putting change in piggy bank

When it comes to mortgages, you have two options: fixed rate and variable rate. Fixed rate means just what it says; your mortgage is at a fixed rate for the entire length of the mortgage. A variable rate mortgage is linked to the prime lending rate which fluctuates, and can change with market conditions.

Many people still choose fixed rate mortgages, but during this unprecedented run of historically low interest rates, a fixed rate can actually be a costly decision.

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1281 Hits
MAR
08

Independent online mortgage hunting vs. working with a mortgage broker...

Couple planning mortgage with mortgage broker

...Why not choose both?

Online mortgage searches and options are becoming more popular than ever. So the question that sometimes comes up is, should I work with a good mortgage broker or go it alone myself with online options.

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1296 Hits
MAR
04

The brutal truth about getting a mortgage

Time for truth

We meet all kinds of mortgage shoppers in our business. Young and old, people buying their fifth home and people hoping to buy their first. Some people have zero debt, good income, and no credit history; There are also people with tons of debt hoping to refinance and make the kind of changes that get them back on track. You name the situation and I guarantee we’ve come across it, and can give the mortgage advice you need. To that end, I thought I’d take some time to boil down the act of getting a mortgage, into areas we like to call the brutal truths of mortgages:


 

A mortgage is a loan – a really big loan

I’m stating the obvious, but that’s because I never lose sight of the fact that a mortgage is a loan and as such, comes with 2 key parts: the part where you qualify for that loan, and the part where you get a loan that has the conditions you need to meet for successfully repaying that loan. Both ends of this require shrewd attention, because conditions can make all the difference in approval and repayment. I like to point this out to everyone so they look at their needs, goals and conditions from a holistic, 360-degree perspective instead of looking only at shiny rates while ignoring what’s under the hood.

Sometimes having patience (and a plan) gets you to a better mortgage down the road

Your credit history and debt load will have a huge impact on qualifying for a mortgage and the rate you qualify for. Many customers are shocked to discover that not having a credit card or debt history actually works against them when shopping for a mortgage. Other customers are surprised to see that simply reassigning some of their existing debt can make a massive difference in getting them qualified. One thing a lot of people don’t realize is that a great mortgage broker should also be a master of understanding debt. I can’t tell you how many folks we’ve helped sort out challenging debt situations so they not only qualified for a mortgage, but they also had a legitimate plan for getting out of, and staying out of high interest debt for the rest of their life. For these clients, getting a mortgage was actually life changing. Sometimes it takes a bit longer to get there, but in the long run, you’ll be miles ahead.

The lowest rate is the most important aspect of your mortgage. Except when it isn’t

If everyone was the same and everyone had perfect credit and debt history, we could all simply shop for a rate. Trouble is, that’s not really how things go. Sure, you’d be hard pressed to beat our best rates anywhere, but the truth is we all have a story, and for a whole host of reasons, good people can find themselves in tough spots. For example, jobs disappear, marriages end, and the investment market can fluctuate wildly. When these things happen, “perfect world” conditions don’t apply and sometimes we need to deal with big financial changes in our lives. Those changes might put people into conditions where they no longer qualify for the best rate possible, and when that happens, a smart mortgage broker can give you options and insights most of us couldn’t possibly find on our own. Conditions change and when you need a solution for those new conditions you’ll be hard pressed to find better advice than you’ll get from a mortgage broker who’s seen pretty much everything there is to see; me.

In the end you have a decision to make

Like anything in life, we all get to make our own decisions, and when it comes to getting a mortgage, you get to decide: am I going to get the best mortgage and financial solution on my own, or by working with someone I trust?

It’s a simple question. If you’re the type of person who really has your house in order, or the kind of person who simply loves planning and negotiating with banks and lenders, you just might be perfect at securing your own mortgage. If you’re the kind of person who wants a mortgage but finds the planning and negotiation process a challenge or worse, something you’d prefer to avoid like the plague, you’ll need to protect your interests by working with someone who’ll work their butt off for you.

We’re ok with whatever you think works best for you, but we’re also happy to have you put our approach to the test. It won’t cost you anything to find out, but it could save you a fortune.

Looking for a mortgage? Wondering if you qualify? Interested in refinancing? Our secure and completely confidential “no obligation” quick-form can give you answers, fast. Find it here.

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1436 Hits
FEB
22

Sometimes looking beyond rate can save you a fortune

 Save a fortune

 We understand our business and we know that every client wants the lowest rate possible, but like I always say, rate – though important, is really only one component of the best mortgage possible. I’ll prove it through a series of questions every borrower needs to have clear answers to...


 

How does your lender calculate penalties?

No one wants to be in this situation, but life happens, and that includes emergencies like separation, divorce, sickness, death or being forced to sell as part of an international move for work. In these situations, big banks use a formula called Interest Rate Differential, which never favours the borrower, so in an emergency, you’ll pay through the nose when your mortgage is with a major bank.

By comparison, Monoline lenders like ICICI Bank, Street Capital, First National, MCAP and CMLS are the best lenders to be with.  They don’t use the same calculations as the big banks and as a result, in an emergency their penalties are dramatically lower by comparison. 

Where is your lender at when it comes to pre-payment or your mortgage?

Prepayment of your mortgage is a great thing if you can do it. It reduces the length of time it takes to pay down your mortgage and can eliminate thousands of dollars in interest as well. There are many ways to prepay a mortgage and I can share them with you when we connect. Again, you really need to know where mortgage lenders stand on prepayment to ensure you get the best terms for your goals and situation. But if you find yourself with extra money, with the right mortgage you can choose to repay up to 10%, 15% or even 20% of the original principal amount of your mortgage at any time during each year of the mortgage term. Again, this can have a massive impact on mortgage and interest payments. You just need to understand where your lender stands.

Is your mortgage portable if you decide to buy and sell in the next five years?

If your mortgage isn’t portable, you will have to start the mortgage process all over again, and you could incur additional costs including a penalty to break the mortgage early as well as higher rates. Portability is a great thing if you think you might sell and buy again within this 5-year window. Also, does your lender offer bridge financing? If there is no bridge financing in place and it ends up being needed, you may have to break your mortgage, pay a penalty and then start all over again, again with the possibility of facing higher mortgage rates. This can be a costly proposition.

Does your lender register a “collateral mortgage” against your property?

A collateral mortgage is where a lender registers a higher amount than the mortgage you are actually borrowing.  The lender advises clients that by doing this, they will save legal fees if they ever have to re-finance in the future.  If this is the case with your lender, then you need to know that for these types of mortgages to be transferrable in the future, you will be required to pay legal fees for that to happen.  Banks who register this type of charge tend to offer clients higher rates on renewal because most clients don’t have the money to pay legal fees to move their mortgage for a better rate.  Collateral mortgages are something you really should know about, regardless of your rate.

These are just a few of the really important questions a real mortgage pro makes a point of answering. The bottom line is that sometimes the best mortgage goes way beyond just getting the best rate, and this is exactly what I do best.

I specialize in mortgage terms and conditions that a lot of people ignore, and as a result, I save my clients a lot of money over the life of a mortgage. I’d like to do that for you as well, so I hope you drop me a line or call me.

Looking for a mortgage? Wondering if you qualify? Interested in refinancing? Our secure and completely confidential “no obligation” quick-form can give you answers, fast. Find it here.

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FEB
10

So who pays the Mortgage Broker?

 

What does a mortgage broker do?

I’m a registered mortgage broker – not an agent (I’ll explain the difference in another later blog post). In a nutshell, my job consists entirely of arranging mortgage financing for people either looking to buy a home or refinancing a home they already own. I’ve been happily doing this job for 28 years.

So who pays the Mortgage Broker?

Good question. I am 100% self-employed, which means I am not paid a salary. Everything I earn is simply a result of being paid a commission by a mortgage lender, and I only get commissioned if I’m successful in connecting the right lender with my clients. You are my priority, so for that reason, I never deal with a single lender. Every client has unique circumstances, which is why I work with a pool of about 20 different lenders, including Banks, Trust Companies, and Credit Unions. This gives my clients more and better options and it makes lenders compete harder for your business. This results in the best mortgage experience for my clients.

In the simplest of terms: If I don’t keep you happy, I don’t get paid.

The only time there might be a charge to you the borrower is when I’m arranging finances for someone with a challenging credit situation or income issues that may make it necessary to borrow from “B” type or private lenders. Sometimes people need help, even when the big banks say no. In this situation, all fees are required to be disclosed up front, by law, so there’s never a surprise and never an obligation before you decide what’s best for you.

This is a tiny list of some of the things I do. If you’re looking to buy or refinance your home, always do your homework and ask questions, because you need to be sure that the mortgage you get is right for your needs – both today and down the road.

I do this stuff every single day. I get paid to help people. In fact, it’s the only way I get paid.  I love what I do, and I’d love to help you.

Looking for a mortgage? Wondering if you qualify? Interested in refinancing? Our secure and completely confidential “no obligation” quick-form can give you answers, fast. Find it here.

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FEB
09

Avoiding the First-time Home Buyer Blues

Homebuyer blues

A lot of young adults are eager to break out of their parents’ houses as soon as they finish school. Most rent, but more and more young adults are intrigued by the idea of owning and either renting or sharing costs and accommodations. It’s an exciting idea that begins to build asset wealth early, but first time home ownership comes with a set of challenges that you need to plan for if you are going to be successful.

The best place to start is by understanding how lenders think and act, and what they expect from an applicant.

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1346 Hits
JAN
26

Credit and Christmas: As the bills come in, a little credit wisdom for next time.

Red gift box on credit card

Credit companies are in the business of making money; a lot of money. Most of it in the form of high interest charges on balances not paid back within 30 days. So, as we look at another Christmas spending season in our rear view mirrors, I thought I would share a few credit tips to help reduce the future cost of using your credit card.


 

If you can’t pay the full bill, always pay the minimum.

Sounds obvious, but you would be surprised how many times a person misses the minimum payment and how that hurts their credit score. Little things really do matter when it comes to protecting and improving credit scores.

If you pay the minimum payment after its due date, you are late. Not only are you paying additional high rate interest on your balance, but your credit card company also reports your late payment to credit agencies like Equifax or Trans Union. These services rate your credit worthiness and share this information with any lender you may hope to deal with.

 When you pay on time, you are rated at “R1”, which is perfect. Pay 30 days late? Get an “R2” rating. Pay later than that, and it keeps getting worse. The more frequently you pay your bills late, the worse the impact on your credit score, and that impacts the terms upon which you can borrow. A credit score of 800 is excellent, 675 is average, and below 600 is problematic when you need to borrow money.

Always carry less than 70% of your card limit as your balance on your card

Here’s a secret not many people know. Even if you pay on time and are “R1” rated, when you carry more than 70% of your available credit limit as your balance, credit bureaus use an algorithm that will end up actually rating you as a higher credit risk, and this will negatively impact your credit score. Do everything you can to not carry an outstanding balance. If you can’t pay your full balance, keep your balance under 70% of your credit limit. If you can’t do that, be sure to pay your minimum on time (or early). When you do these things, you will improve your credit score. That will give you better borrowing options and save you a ton on fees.

Today mortgage lending has become almost completely dependent on having a good credit score. If you have any questions on credit scores or mortgages, I’m happy to help you answer them. 

Looking for a mortgage? Wondering if you qualify? Interested in refinancing? Our secure and completely confidential “no obligation” quick-form can give you answers, fast. Find it here.

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1140 Hits
JAN
14

Budgeting for your new home? It’s all in the details.

Buying home loans

Buying your first home is an exciting event. In fact, for most of us, it’s the most significant purchase we may ever make. As a new homeowner, you put a lot of work into buying the right home for you at the right price and getting the best first mortgage possible, but there are other costs you need to plan for. If you don’t, you could be in for a bit of a rude awakening. I’m going to show you how to avoid this additional financial stress.

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Contact Us

  • Ottawa-Carleton Mortgage Inc
    381 Richmond Road Ottawa,
    Ontario K2A 0E7
  • Phone: 613-563-3447
    (24 hours)
  • Fax: 613-563-3195

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