Value in Home Improvements

As we move into 2009, you may be thinking about those spring-time projects that you will need to tackle, like landscaping the garden, rebuilding a patio or fence, changing older windows and doors, a new roof, or even remodeling your basement, kitchen or bathroom. If you tune in to some recent popular TV programs like “Extreme Makeover – Home Edition”, you will surely catch the home makeover bug.

If you live in a freehold house, you should be spending an average of 1% of your home value annually, on maintenance, just to keep it in good repair and to prevent it from declining in value, according to “Home Buying for Dummies” by Eric Tyson and Ray Brown. And according to the Appraisal Institute of Canada’s 2004 Home Renovation Survey, professional home improvements and renovations will bring the following return on your investment:

Top Four Renovations that will give you the Highest Payback Potential

Bathroom renovations (75-100%) Kitchen renovations (75-100%) Interior painting (50-100%) Exterior painting (50-100%)

Other Renovations Payback Potential

Roof shingle replacement (50-80%) Furnace/heating system (50-80%) Basement renovation (50-75%) Recreation room addition (50-75%) Installing a fireplace (50-75%) Flooring (50-75%) Constructing a garage (50-75%) Window/door replacement (50-75%) Building a deck (50-75%) Central air conditioning (25-75%)

Six Renovations that will give you the Lowest Payback Potential

Landscaping (25-50%) Interlocking paving (25-50%) Building a fence (25-50%) Asphalt paving (20-50%) Adding a swimming pool (10-40%) Installing a skylight (0-25%)

Homeowners can also visit the “Appraisal Institute of Canada” website, to try out their on-line tool which helps you understand what value you can anticipate to see from the various improvements that you make on your home. The name of this particular tool is called RENOVA and it is an excellent resource for homeowners. You may visit the site, by following this link below:

http://component.aicanada.ca/e/resourcecenter_renova.cfm

Remember that the referenced website link is only a guide, and you should always carefully consider that proper appraisal values can only be provided by a certified professional appraiser holding an AACI or CRA designation. It is also important to mention that an appraiser will also assess other factors, about the home, to complete accurate appraisal results, for example, the neighbourhood, recent real estate activity, lot, location, etc.

This article was written by Elizabeth Blair, a Licensed Mortgage Agent with Mortgage Edge in Richmond Hill, Ontario. Elizabeth services mortgage clients in Mississauga and all over the Greater Toronto area.

You can contact Elizabeth directly by phone at (905) 510-5785

by email at eblair@mortgageedge.ca

or you visit her website at: www.missmortgage.ca

Elizabeth is licensed with the Financial Services Commission of Ontario and is also a Member of IMBA (the Independent Mortgage Brokers Association of Ontario) www.imba.ca

Useful Website Links for Home Buyers in Ontario

Tired of navigating through countless websites to find the exact information that you need? I am too so I decided to put together a list of useful links that you can use yourself. The subject areas covered are, buying a home and mortgage loan insurance premiums, information on the Ontario land transfer tax and refund, enrolling in your city’s pre-authorized payment plan, a link to ordering your own personal credit report as well as a link to the government website listing grants available to home owners who make their homes more energy efficient. Please let me know if these are helpful and if happen to think of any new links that you would like to see, please pass along your ideas to me and I will attempt to add this on. I sincerely hope that these links can save you some time.

Do you need to check if a Mortgage Brokerage, Administrator, Mortgage Agent, or Mortgage Broker is registered and properly licensed in Ontario

Visit the Financial Services Commission of Ontario website at:

http://www2.fsco.gov.on.ca/mbslist/agents.mbl

Do you want to look up the Mortgage Loan Insurance premiums with

Genworth Financial Canada

Mortgage Loan Insurance premiums are available at:

http://www.genworth.ca/mi/eng/product_solutions/premiumRateTable.html

Do you want to look up the Mortgage Loan Insurance premiums with

AIG United Guaranty

Mortgage Loan Insurance premiums are available at:

http://www.aigug.ca/products/premium-rate-chart.pdf

Do you want to look up the Mortgage Loan Insurance premiums with

Canada Mortgage and Housing Corporation or CMHC

Mortgage Loan Insurance premiums are available at:

http://www.cmhc-schl.gc.ca/en/co/moloin/moloin_005.cfm

Do you need to know anything about the Ontario Land Transfer Tax, how it is calculated on your purchase price, or how to apply for the land transfer tax rebate for either a newly constructed home, or a resale home, visit the the Government of Ontario, Ministry of Revenue website at:

http://www.rev.gov.on.ca/english/taxes/ltt/

Do you need to enroll in the City of Mississauga’s Pre-authorized Tax Payment Plan

Visit the City of Mississauga website at:

http://www.mississauga.ca/portal/residents/taxformscentre

Do you need to enroll in the City of Oakville’s Pre-authorized Tax Payment Plan

Visit the City of Oakville website at:

http://www.oakville.ca/taxpayment.htm

Do you need to enroll in the City of Milton’s Pre-authorized Tax Payment Plan

Visit the City of Milton website at:

http://www.milton.ca/residents/tax/taxpayment.htm

Do you need to enroll in the City of Toronto’s Pre-authorized Tax Payment Plan

Visit the City of Toronto website at:

http://www.toronto.ca/taxes/property_tax/forms.htm#plan

For an in-depth document of the ABCs of mortgages, you can

Visit the Financial Consumer Agency of Canada or FCAC website to read it:

http://www.fcac-acfc.gc.ca/eng/publications/mortgages/Amortization_e.asp

Genworth Financial publishes daily mortgage rates on their website at:

http://www.genworth.ca/mi/eng/misc_pages/interest_rates.asp

Equifax Canada

Order a copy of your consumer credit report:

http://www.equifax.com/home/en_ca

Do you want to see what grants, rebates, discounts and incentives are available

If you make your home more energy efficient?

Please visit the Natural Resources Canada website at:

http://oee.nrcan.gc.ca/corporate/incentives.cfm

This article was written by Elizabeth Blair, a Licensed Mortgage Agent with Mortgage Edge in Richmond Hill, Ontario. Elizabeth services mortgage clients in Mississauga and all over the Greater Toronto area.

You can contact Elizabeth directly by phone at (905) 510-5785

by email at eblair@mortgageedge.ca

or you visit her website at: www.missmortgage.ca

Elizabeth is licensed with the Financial Services Commission of Ontario and is also a Member of IMBA (the Independent Mortgage Brokers Association of Ontario) www.imba.ca

How can I get a copy of my credit report?

Here is a question, I am often asked…..how can I get a copy of my credit report ?

If you are applying for a mortgage, a loan, a credit line, or are seeking to rent a property, your credit report will be accessed and reviewed by the person or the institution where you are applying.   If you have purchased a home, you may also be asked to provide some proof of your credit status by any of the local utility companies who you need to utilize the services of.

For a mortgage application, the bank loan officer, or the Mortgage Broker/Agent will require a copy of your credit report.   When the mortgage application is completed, the credit report will be requested on your behalf, as part of the application process.  Remember that you must always be ASKED to sign a credit permission or consent form BEFORE anyone is authorized to retrieve a copy of your credit report.  Do not allow anyone to pull your credit report over the phone.   If they have pulled a credit report, without your PRIOR written consent, you have grounds for a formal complaint.   The basic information required, to access a credit report is:  full legal name, current address, city, province, postal code, date of birth and social insurance number.   Most banks and brokerage houses are pulling credit reports directly from Equifax Canada.  The cost to access your consumer credit report is covered, by the bank or brokerage that is completing your mortgage application.   It is also important to mention that your bank or Broker/Agent is never permitted to give you a copy of your credit report, nor are they permitted to share particulars about your credit report with you, for example, what your actual credit score is.   If you need a copy of your own credit report, you must access it on your own.

You can access your credit report by going online to the Equifax website:    http://www.equifax.com  and request a copy of your credit report there.  You will need your credit card to order either one of the two available report formats.  The first, more detailed report, is available for $23.95 Cdn and this detailed report will provide you with your actual “credit score”.   The credit score is the number that most lenders use when deciding whether they will give you financing or not.   The second report is available at a lower price of $15.50, however, your actual credit score is not available on that less expensive credit report.

If you would rather not pay for your credit report, you can access a copy of your credit report, once per year, free of charge.  By filling out the Equifax form available at this link and returning it to Equifax, you will then receive a copy of your credit report in the mail.

http://www.equifax.com/EFX_Canada/consumer_information_centre/docs/request_report_form_e.pdf

Note that when you request your credit report, by this method, you will NOT be able to see your actual credit score.  If it is your credit score, that you would like to see, you will need to go on-line and purchase the Equifax report via the website at the $23.95 Cdn price.

Knowing your credit score is important as it helps to ensure you are always eligible for the best rates and financing options.   Find out your own credit score, monitor it, protect it and take the necessary steps to maintain the best credit score you possibly can.

This blog was submitted by Elizabeth Blair, a Licensed Mortgage Agent with Mortgage Edge located in Richmond Hill, Ontario, Canada.   Elizabeth services clients in Toronto and all over the Greater Toronto Area, including Mississauga.

You can contact Elizabeth directly by phone at (905) 510-5785, by email at Elizabeth@missmortgage.ca or visit her website at:    www.missmortgage.ca

Elizabeth is licensed with the Financial Services Commission of Ontario and is also a Member of IMBA (the Independent Mortgage Brokers Association of Ontario) www.imba.ca

Watch that mortgage renewal date

Watch your mortgage renewal statement and ensure your renewal does not sneak up too quickly or you will not have time to negotiate the best deal !

Did you know, in Canada, that your current lender must send you a renewal statement at least 21 days before the end of your mortgage term. I suppose that lenders wait this late to send you a renewal notice so that you have little time to negotiate or shop around for a better mortgage rate. When you receive your renewal, you will probably be very surprised to see that the rates offered are not the lowest or most competitive rates in the market.

Give yourself more than 21 days to explore your mortgage renewal.

Find your mortgage contract or your latest annual mortgage statement to find out what your exact renewal date is then mark your calendar to begin looking about 30 – 45 days before your renewal date. If your bank has not given you the most competitive or lowest rate, you do have the option to leave that lender.

Ask yourself this question……if you have good credit and a good mortgage re-payment history, with your current lender, WHY would you spend your time badgering your bank for a better rate when you are entitled to the best rate the first time?  Call me so I can show you how you can SWITCH your mortgage lender and at NO COST to you.

This blog was submitted by Elizabeth Blair, a Licensed Mortgage Agent with Mortgage Edge located in Richmond Hill, Ontario, Canada.   Elizabeth services clients in Toronto and all over the Greater Toronto Area, including Mississauga.

You can contact Elizabeth directly by phone at (905) 510-5785, by email at Elizabeth@missmortgage.ca or visit her website at:    www.missmortgage.ca

Elizabeth is licensed with the Financial Services Commission of Ontario and is also a Member of IMBA (the Independent Mortgage Brokers Association of Ontario) www.imba.ca

Client feedback is important

I believe client feedback is important. As a self-employed business person, I am always looking for ways to improve my business and improve my service level to every client who comes my way. I worked in the Corporate world, for many years, and although I always dreaded performance reviews, like the 360 degree feedback, it was an important time as it helped me to carefully assess where I needed to improve. This is why I believe the feedback process is critical and so I always ask my clients to give me their honest feedback. Feedback allows me to “fine-tune” my business and helps me to know whether my clients are completely satisfied.
Here is a list of comments, from recent clients, who I have helped with their mortgage financing:

Thank you for switching my mortgage to a new lender. Your honesty, patience, dedication and integrity have surpassed anyone I have ever worked with, in my entire life, when it comes to dealing with money. I am happier now, more than ever, knowing that I have the flexibility to pay off my mortgage sooner and it did not cost me a penny to switch. You have listened to my needs and you have delivered. Thank you, thank you, thank you.
Violet Soman, Brampton, Ontario

Being newcomers to Canada means that there are many challenges in your way that ordinary people may not face every day. When the time came for us to buy our first house, we were very uncertain on how we were going to qualify for and obtain a Mortgage. We did not understand the Canadian home buying and Mortgage system at all. Elizabeth Blair was able to give us the advice that we needed as newcomers to the home market. Not only that but Elizabeth managed to secure a great rate for us, in spite of the banks initially not even wanting to look at our applications because we were so new Canada. We faced many hurdles because of our newly arrived status and financial history. I am certain that I would not have been successful in obtaining a Mortgage without Elizabeth’s help and hard work. I would recommend Elizabeth to anybody who is looking for a reliable, efficient and friendly professional. She was a great help to us and I will definitely make use of her services again.
Francois and Renate Barnard, Oakville, Ontario

Elizabeth was wonderful to work with. She is dedicated, courteous, and willing to take the extra time to answer any questions you may have. I would have no reservations recommending her to anyone who requires assistance with negotiating their mortgage. Elizabeth is the consummate professional! Thank you for all your hard work on our behalf.
Phil and Donna Robertson, Kingston, Ontario

Elizabeth facilitated the purchase of our first home. I emailed her daily with questions to which she responded within hours. Without her commitment I truly believe we would not have obtained our dream home which we have today. She was reliable and resourceful every step of the way! Dr. T Reilly Ottawa, Ontario

I would like to commend Elizabeth Blair of Mortgage Edge on her exceptional professionalism. She took the time to listen and inspire. Our brief conversation moved me to re-think what I believed was a situation with no solution. Special, experienced and caring individuals are rare. Many individuals could benefit from her compassionate style and I thank you and the WHO organization for providing the platform where such fantastic professionals can connect. There is lots of information provided but rarely anyone willing to explain, even less who care about the individual in the financial services industry. Elizabeth inspired me to believe that there is always hope, and there are good people with integrity. I thank Elizabeth for giving me some of her time, her confidential brief consultation of experience and understanding. Ivy Hobe Marciniak, Mississauga, ON

As a first time home buyer, I had no knowledge of what to expect and was very nervous about making such a big investment at such a young age. Elizabeth guided me and was there for me every step of the way. She was always available to answer any of my questions and she not only provided me with necessary information, she also better educated me on other possibilities and market opportunities. Elizabeth ensured that I received the desired amount of money necessary to purchase my home and made sure I received the best rate on the market. She not only provided me with her services as a mortgage broker, but she went above and beyond on a personal basis and ensured that my transaction went as smoothly as possible. It was a true pleasure to work with someone who is not only knowledgeable but who also puts all of their effort and heart into their work. Sofia Neves, Toronto, ON

Elizabeth was recommended to us by our realtor. Being new to Canada we were not sure if it was wise to use a mortgage broker or go straight to the bank. After speaking with Elizabeth, we were very impressed with her knowledge and experience and we were instantly drawn to her. She was professional and yet friendly. She was able to get us a pre-approval immediately. We really enjoyed working with her and felt very comfortable that she had our best interests at heart. We have already recommended her to all of our friends. Stephanie & Oscar Dewar, Mississauga, ON

We had been dreaming of buying our first detached house for some time. All our hopes were recently shattered when I was laid off from my job. I called Elizabeth and was amazed when she told me that financing was still possible. Elizabeth worked diligently to make our financing happen. She was always there when we needed to speak to her. What I admired most was her professionalism and amazing speedy advice to all of our questions and concerns. I am writing this short note from the comfort of our new home. I recommend her to any potential home buyer with utmost confidence. Saman Warnasuriya, Mississauga, Ontario

Elizabeth is a marvel. She was able to consolidate some very high debt that I had incurred at a bad time in my credit history. I was in my third term of pregnancy with creditors calling every day and a lawsuit pending. Elizabeth got me through my despair and made me feel I was a priority at all times. I would highly recommend her services to anyone.
Cathy Law, St. Catherines, ON
Much to my surprise, Elizabeth was able to refinance my mortgage at a rate even lower than my own bank was offering. Not only did she save me thousands of dollars, she removed the usual headaches associated with financing.
Michael Smith, Senior Accountant, Streetsville Business Services, Streetsville, ON

Elizabeth surpassed all of my service expectations. In today’s world of low service standards, it was refreshing to deal with a professional who made me feel like I was her one and only priority. I would not hesitate to recommend Elizabeth to any of my family or friends. Mark Pundzius, Toronto, ON

As first time buyers, Elizabeth helped us understand our mortgage financing options. We also felt confident throughout the entire process as Elizabeth answered all of our questions and handled our paperwork with efficiency.
David Bitterman and Dr. Adrianna Arkilander, Mississauga, ON

This blog was submitted by Elizabeth Blair, a Licensed Mortgage Agent with Mortgage Edge located in Richmond Hill, Ontario, Canada. You can contact Elizabeth directly by phone at (905) 510-5785, or by email at eblair@mortgageedge.ca or visit her website at: www.missmortgage.ca

Elizabeth is licensed with the Financial Services Commission of Ontario and is also a Member of IMBA (the Independent Mortgage Brokers Association of Ontario) www.imba.ca

Good tips for first time home buyers

If you are thinking of buying a house soon, here are some good tips to help you get started:

1.  Begin saving cash for your downpayment.  The larger your downpayment, the lower your mortgage obligation will be.  You can also place saved funds into an RRSP, and then cash them out to use towards your downpayment.  Remember that an RRSP will also give you some tax benefits each year, as you save.  Seek out the assistance of a good financial planner to help you towards that goal.

 

2.  All applicants on the mortgage should be using credit and be working towards building a credit history.  Use credit, pay it off.   Some examples of items that will develop your credit history are credit cards, line of credit, a car loan, a personal loan.

 

3.  Always pay your credit card bills, utility bills and anyone who provides you services ON TIME.  Remember that if you do not pay other companies, that may have provided services to you, and you owe money to them, those same companies could file “collections” against you for those monies owed and these collections are listed on your credit report.  Removing collection items from a credit report is a lengthy and tedious process.

 

4.  Avoid running up too many balances on cards or too much debt:  A common one I see is car loans.    Car loans are relatively easy to obtain, however, when it comes time to apply for a mortgage, and you have monthly payment obligations of $800 a month, it may greatly reduce your ability to qualify for a higher mortgage amount especially if you are carrying other debt obligations.  I always tell first-time buyer clients, to go out and buy the least expensive well-maintained used car they can find, pay cash for it, and drive it around until after they buy and move into their house.  After purchasing a house, they can then go out and take on a car loan and see what they can comfortably afford with the new mortgage obligation.

 

5.  Do not sign up as a co-signer or guarantor for anyone else.  If you do, you could be disqualified for a mortgage if you have a financial obligation to someone else’s debt.   Even though you may only have co-signed, that debt obligation would have to be disclosed on your mortgage application and depending on what that amount is, you may not be able to qualify for the amount you need on your mortgage application.

 

6.  Don’t switch jobs just before you apply for a mortgage unless you can wait out the probation period on the new job.  If your new position does not have a probationary period, that would be fine with most lenders reviewing your mortgage application.

 

7.  Be sure you understand the whole financing process when purchasing from a builder.  Often qualifications are given by the ‘in-house’ lender at the builder’s office, but clients often walk away without ever really understanding what happens with their mortgage qualification in the long-term (18 months away or whenever their new home is built).  I recently received a phone call from someone who made a deposit with a builder, over a year ago and was about to lose their deposit on closing date, because they could not qualify for their mortgage.  The lender could not approve the mortgage loan since the client’s financial status had changed.  Remember that a lender reserves the right to review all applicant’s financial status and if there is some substantial change in their financial status, right before closing date, the lender could refuse to fund the mortgage.  Read the fine print of any contract you sign and understand that while you may have put down a deposit with a builder, the house is really not yours until your financing is affirmed.

 

This blog was submitted by Elizabeth Blair, a Licensed Mortgage Agent with Mortgage Edge located in Richmond Hill, Ontario, Canada.   Elizabeth services clients in Toronto and all over the Greater Toronto Area, including Mississauga.

You can contact Elizabeth directly by phone at (905) 510-5785, by email at eblair@mortgageedge.ca or visit her website at:    www.missmortgage.ca

Elizabeth Blair is licensed with the Financial Services Commission of Ontario and is also a Member of IMBA (the Independent Mortgage Brokers Association of Ontario) www.imba.ca

 

 

License required in Ontario

Are you obtaining a mortgage in Ontario, and are planning to use someone, instead of your own bank?

Before you proceed to utilize their services, you need to check that they are licensed.   

Effective July 1, 2008, every Mortgage Brokerage, Mortgage Administrator, Mortgage Agent and Mortgage Broker who is carrying on in the business of dealing in mortgages, in Ontario, MUST have a valid current license.  Licenses can only be issued by the Financial Services Commission of Ontario (FSCO) to qualified applicants.  FSCO has established certain criteria to qualify for a license and unless applicants can meet the established criteria, a license cannot be issued.  If you are uncertain as to whether you are dealing with someone who carries a proper license, you may visit the FSCO website to verify any person’s status or any specific Brokerage to determine if they carry a valid license.      

http://www2.fsco.gov.on.ca/mbslist/Agents.mbl

Any person dealing in mortgages, after July 1, 2008, who is NOT licensed can be prosecuted and fined and you may report that person directly to FSCO. 

 

 

This blog  was written by Elizabeth Blair, a Licensed Mortgage Agent with Mortgage Edge in Richmond Hill, Ontario.  Elizabeth services clients in Mississauga and all over the Greater Toronto area.

 

You can contact Elizabeth directly by phone at (905) 510-5785,  by email at eblair@mortgageedge.ca  or you visit her website at:    www.missmortgage.ca 

 

Elizabeth is licensed with the Financial Services Commission of Ontario and is also a Member of IMBA (the Independent Mortgage Brokers Association of Ontario) www.imba.ca

What exactly is mortgage loan insurance?

As a first time home buyer, you may have heard that you may have to pay a mortgage insurance premium.  

 

You will have to obtain mortgage loan insurance when you purchase a home and if your downpayment is LESS than 20%.  Remember that lenders do reserve the right to insure your mortgage even if your downpayment is greater than 20% and this decision is often based on the risk associated with the financing.    The key players that provide mortgage insurance in Canada today are CMHC, Genworth and AIG United Guaranty.   The newest insurer to join is AIG United Guaranty.   There may be more mortgage insurers joining the industry who may apply to the OFSI (Office of the Superintendent of Financial Institutions) to become mortgage insurers in Canada.  More competition will result in more choice and lower premium costs for Canadians who want to purchase a home.

 

Here is a sample breakdown to help you understand how a mortgage insurance premium is calculated for a buyer who wants to purchase a home with a 5% downpayment.

 

 

Price of home being purchased	(A)  $242,000
Your saved 5% downpayment	(B)  $12,100
Price less downpayment  (A) – (B) =	(C)  $229,900
Insurance Premium calculated for a 5% downpayment is 2.75% of amount $229,900   Total mortgage loan insurance premium is  à	(D)  $6,322.25
Total amount advanced to you by the Lender total mortgage amount   (C)  + (D)  =	$236,222.25
The lender who is reviewing your mortgage application will include the mortgage insurance premium (on your mortgage commitment) as part of your total mortgage loan and this is repaid over the term of your mortgage loan.   You can also pay this premium up-front, on closing date, if you prefer.

 

It is also important to point out that the mortgage loan insurance premium (calculated in example above) is also subject to provincial sales tax and this tax amount is not included in the total loan amount therefore you would have to pay this sales tax on your closing date.

 

Here below is a table that gives you an idea on what the typical mortgage loan insurance premiums are, but you should go directly to the various insurer websites to check the current insurance premiums when you are ready to buy.

 

 

The mortgage loan insurance premium charges are calculated as follows:

 

Financing Needed on the Purchase	Insurance Premium
Up to and including 65%	0.50 %
Up to and including 75%	0.65 %
Up to and including 80%	1.00 %
Up to and including 85%	1.75 %
Up to and including 90%	2.00 %
Up to and including 95%	2.75 %

 

 

You may be asking, so why do I need mortgage loan insurance, is it mandatory, and who does it protect?  

 

Why do I need mortgage loan insurance?   It is the lender who requires the mortgage loan to be insured.   The mortgage lender passes along the cost of insuring that mortgage, along to the consumer. 

 

Is mortgage loan insurance mandatory?   No.   There are a few mortgage lenders, on the market, who may provide you with mortgage financing without mortgage loan insurance but there will most certainly be a much higher interest rate offered as well as other administrative fees that could be added to the mortgage loan amount.   These other mortgage lenders can be accessed through the mortgage broker community.

 

Who does mortgage loan insurance protect?   Mortgage loan insurance is required by the mortgage lender because it protects the lender, if, the borrower, for some reason, cannot pay their mortgage.

 

This article was written by Elizabeth Blair, a Licensed Mortgage Agent with Mortgage Edge in Richmond Hill, Ontario.  Elizabeth services mortgage clients in Mississauga and all over the Greater Toronto area.

 

Elizabeth is licensed with the Financial Services Commission of Ontario and is also a Member of IMBA (the Independent Mortgage Brokers Association of Ontario) www.imba.ca

 

You can contact Elizabeth directly by phone at (905) 510-5785

by email at eblair@mortgageedge.ca

or you visit her website at:    www.missmortgage.ca 

 

 

Hot News: Lenders slashing variable discounts

Hot news for those who are looking for variable rate mortgages. Here is the best deal available today:

Prime Rate plus 0.15%. —> 2.40% *

Wow, this is an excellent rate and is only available for mortgage terms of less than 3 years.

You pick a renewal date between March 19, 2012 and May 31, 2012.

This blog post was written by Elizabeth Blair, a Licensed Mortgage Agent with Mortgage Edge in Richmond Hill, Ontario. Elizabeth services mortgage clients in Mississauga and all over the Greater Toronto area.

You can contact Elizabeth directly by phone at (905) 510-5785

by email at eblair@mortgageedge.ca

or you visit her website at: www.missmortgage.ca

Elizabeth is licensed with the Financial Services Commission of Ontario and is also a Member of IMBA (the Independent Mortgage Brokers Association of Ontario) www.imba.ca Lic # M08005880 Brokerage Lic # 10680 Head office is located at: 15 Wertheim Court, Suite 210, Richmond Hill, Ontario, Canada.
*Please note that rates are subject to change without notice.

mortgage + line of credit option

Home owners who have lots of equity in their house, might be looking for ways to get access to that equity without having to re-finance their house every time a need arises for some additional money.

A mortgage with a line of credit portion is a great product for some. Here are some typical reasons why you might want to get access to your home equity: buy investments, stocks, bonds, RRSPs, renovate your home, pay for education costs, or other reasons.

The diagram below shows a total home value of $380,000 divided into three sections: the top portion means that 20% of your home value must remain as equity and cannot be financed. The middle portion represents the line of credit portion. The line of credit portion can go up to 80% of the value of the home. The bottom portion is your actual mortgage loan portion today, that you decide to convert over, when you move into this product.

Using the example of a home owner who has a home valued at $380,000……This client has a mortgage balance right now, with a lender, at $210,000. By moving into the mortgage + line of credit product, the current mortgage amount of $210,000 is set up as either a FIXED mortgage, or a VARIABLE rate mortgage.

The borrower can then use anything over this set mortgage amount, all the way up to 80% of the home value.

The home Value for this illustration is $380,000
——————————————————-
20% cannot be financed
——————————————————-
$ 94,000
the MAX Line of Credit portion

Variable rate calculated at
**Prime + 1%

**2.25% + 1% = 3.25%

Line of credit can be increased
up to 80% of the value of the home
——————————————————-
current Mortgage balance today
$ 210,000

Variable rate / 5 year term
Or
Fixed Rate at a 2, 3, 4, 5, 7, 9, or 10 year term
5 yr fixed = 3.69%
or
variable =
**Prime 2.25% + 0.80% = 3.05%
——————————————————-

It is important to mention……. this kind of mortgage product requires a very disciplined borrower as reckless spending or improper investing strategies, with the line of credit portion, could have a very negative outcome: a higher debt and possibly the inability to re-pay the debt.

NOTE: Mortgage rates are effective as of May 17, 2009. **The variable rate amount can go up or down depending on current posted Prime Rate. Mortgage rates are subject to change without notice.

This blog was written by Elizabeth Blair, a Licensed Mortgage Agent with Mortgage Edge in Richmond Hill, Ontario.

Elizabeth services mortgage clients in Mississauga and all over the Greater Toronto area.

You can contact Elizabeth directly by phone at (905) 510-5785

by email at eblair@mortgageedge.ca

or you visit her website at: www.missmortgage.ca

Elizabeth is licensed with the Financial Services Commission of Ontario and is also a Member of IMBA (the Independent Mortgage Brokers Association of Ontario) www.imba.ca
Lic # M08005880 / Brokerage Lic # 10680

Best mortgage rates today

Best mortgages rates today** February 7, 2009

1 year fixed rate: 3.50%
3 year fixed rate: 3.75%
5 year fixed rate: 4.34%
Variable rate: 3.70%

**Rates subject to change without notice.
O.A.C. / E.& O.E.

This was posted by Elizabeth Blair, a Licensed Mortgage Agent with Mortgage Edge in Richmond Hill, Ontario. Elizabeth services mortgage clients in Mississauga and all over the Greater Toronto area. You can contact Elizabeth directly
by phone at (905) 510-5785
by email at eblair@mortgageedge.ca
or you visit her website at: www.missmortgage.ca
Elizabeth is licensed with the Financial Services Commission of Ontario and is also a Member of IMBA (the Independent Mortgage Brokers Association of Ontario) www.imba.ca
Lic # M08005880
Brokerage Lic # 10680
Head office is located at: 15 Wertheim Court, Suite 210, Richmond Hill, Ontario, Canada.

What is a mortgage discharge fee?

I received an email from someone who found my website on the internet, asking me why they were charged a discharge fee, by their bank, when they paid off the full balance of their mortgage. This was a fee that they were surprised to see and they were checking with me to see if that was a valid charge that they had to pay.

I explained to this person that this was most definitely a valid fee and that they should go back to their original mortgage contract/mortgage commitment to read the fine print, listed somewhere in their document. If you refer to the fine-print of your mortgage agreement/commitment, you will see it there listed under a “fees” section and it will list all standard fees borrowers will pay in certain situations, for example, service fees, assignment/transfer fee, processing fee, default charges/missed payment fee, as well as the discharge fee, as well as other possible fees related to the mortgage.

Here are a few situations where you would be required to pay a discharge fee:

1) if you pay off your entire mortgage balance;
2) if you switch from your current bank, to another bank, and register a new mortgage with the new bank.
3) if you sell your home and switch from your current bank to another bank.

The discharge fee is worked out, by your bank, on a simple one page form and it really does seem to be a very excessive fee to pay, for a simple form that may have taken your bank a short time to prepare. Interestingly, the mortgage discharge fee varies from province to province and from lender to lender. Did you know, for example, that in the province of British Columbia, The Financial Institutions Commission (FICOM) which regulates the financial services industry, has stated that a mortgage discharge fee must not exceed $75. You can read about their position at this following link:
http://www.fic.gov.bc.ca/pdf/mortgagebrokers/mb-07-003.pdf

Unfortunately, the Financial Services Commission of Ontario (FSCO) has not created a similar cap on the bank’s mortgage discharge fee in Ontario. While every bank must disclose the discharge fee, in the mortgage contract provided to you, you can also go on-line to see what current published discharge fees are, at any time. Remember, however, that the discharge fee that you see in the mortgage contract you signed, is the fee that you will be charged once there is a need to have a mortgage discharge statement prepared. Bank’s published discharge fees can be viewed at this following link:
http://www.fiscalagents.com/thestar/mtg_disx_sort.shtml

This article was written by Elizabeth Blair, a Licensed Mortgage Agent with Mortgage Edge in Richmond Hill, Ontario. Elizabeth services mortgage clients in Mississauga and all over the Greater Toronto area.

You can contact Elizabeth directly by phone at (905) 510-5785
by email at eblair@mortgageedge.ca
or you visit her website at: www.missmortgage.ca
Elizabeth is licensed with the Financial Services Commission of Ontario and is also a Member of IMBA (the Independent Mortgage Brokers Association of Ontario) www.imba.ca
Lic # M08005880
Brokerage Lic # 10680
Head office is located at: 15 Wertheim Court, Suite 210, Richmond Hill, Ontario, Canada.

Best mortgage rates on February 3, 2009

Best mortgage rates for qualifying clients:

Variable: 3.80%
1 Year: 3.50%
3 Year: 3.75%
4 Year: 4.19%
5 Year: 4.39%
7 Year: 5.80%
10 Year: 5.95%
*Interest rates are subject to change without notice.
Contact Elizabeth Blair at Mortgage Edge (905) 510-5785
Email: eblair@mortgageedge.ca

Canadian government federal budget to help the housing industry

Anxious Canadians have waited to see how our government would tackle a monstrous world economic crisis and its spill-over effects into Canada. It was a year ago, in January 2008, that some economists optimistically announced Canada would experience some pain however we would be immune to any kind of recession here. As the mouse slept beside the elephant, the elephant did roll over and we were also smothered by its weight.

It was in the last quarter of 2008, that the story changed. The housing market continued to slow down, vehicle sales fell and Canadian exports to the USA dropped. Many Canadian companies began to see a decline in their own business and forced many to downsize. As companies began to cut back on their workforce, the overall job losses in Canada have continued to climb. It is estimated that Canada will lose approximately 170,000 jobs, this year alone.

Canada is most certainly in a recession and desperately awaits an injection of hope. In response to this economic crisis, Canadians must now place their faith in the new federal budget which was tabled in the House of Commons, by the Honourable Jim Flaherty, Minister of Finance on January 27, 2009. This very detailed 360-page report entitled: “Canada’s Economic Action Plan – Budget 2009” is available for review at the following link:

http://www.budget.gc.ca/2009/pdf/budget-planbugetaire-eng.pdf

Recognizing that the Canadian housing industry is a significant contributor to our economy and its growth and stability, a swift move to stimulate the housing industry was critical. Canada’s housing industry has experienced a drop in new building permits, housing starts, and a decline in housing sales and home prices. Along with the slow-down has come stricter lending and financing guidelines which have also resulted in many mortgage defaults and foreclosures. The Economic Action Plan promises to provide a total of $7.8 billion in tax relief and funding. The objective is to give much needed support and stimulation to this very important industry where thousands of jobs in real estate, financing, construction, trades, and housing industry suppliers are in jeopardy now.

As the Action Plan is now official, here are some highlights of the Economic Action Plan, of interest to Canadian home owners:

1. Canadians who want to make their homes more energy efficient are able to receive grants from the Federal and Provincial governments. These grants can total, up to $10,000 for energy-saving approved and compliant upgrades. The Action Plan outlines an additional $300 million that will be allocated to this program, over a 2-year period. The program is already known as the “ecoENERGY Retrofit” initiative. You may visit the government website at ecoaction.gc.ca and follow the links to the ecoENERGY Retrofit, or call 1-800-622-6232 to find out how you, as a homeowner, can apply to receive available grants through the program.
2. First time home buyers, will be able to receive a $750 tax credit to offset closing costs. The tax relief will be extended to those first time buyers who acquired a home after January 27, 2009. This is a great incentive especially considering that the Ministry of Revenue extended a refund on the Land Transfer Tax, to buyers of resale homes, back in December 2007. This allowed first-time home buyers to apply for a refund, for up to a maximum of up to $2,000 on the land transfer taxes paid. Details on this previous notice can be found at the following link: http://www.rev.gov.on.ca/english/taxes/ltt/
3. A Home Renovation Tax Credit is being introduced. For eligible home renovation expenses, performed after January 27, 2009 and before February 1, 2010, individual home owners may claim a tax credit up to a maximum of $1,350. The credit must be claimed on your 2009 income tax return and the renovation expenditure must be greater than $1,000 but not more than $10,000 to receive the maximum credit of $1,350.
4. The Canada Revenue Agency Home Buyers’ Plan (HBP) will also be revised to allow first-time home buyers an opportunity to withdraw from their Registered Retirement Savings Plan (RRSP) avoiding the requirement to pay tax on the withdrawal but at a new higher amount. The new withdrawal limit is $25,000 compared with the previous limit of $20,000. An individual, or an individual and their spouse, or common-law partner can combine their maximum limit to make a total HBP withdrawal of $25,000 each, thus bumping the maximum allowed HBP withdrawal to $50,000 for the pair.
This article was written by Elizabeth Blair, a Licensed Mortgage Agent with Mortgage Edge in Richmond Hill, Ontario. Elizabeth services mortgage clients in Mississauga and all over the Greater Toronto area.
You can contact Elizabeth directly by phone at (905) 510-5785
by email at eblair@mortgageedge.ca
or you visit her website at: www.missmortgage.ca
Elizabeth is licensed with the Financial Services Commission of Ontario and is also a Member of IMBA (the Independent Mortgage Brokers Association of Ontario) www.imba.ca
Lic # M08005880
Brokerage Lic # 10680
Head office is located at: 15 Wertheim Court, Suite 210, Richmond Hill, Ontario, Canada.

The Financing Clause

If you have been through the process of purchasing a home, you may have remembered a clause, at the back of your purchase agreement, that states something like this:

“ This offer is conditional upon the Buyer arranging financing within FIVE (5) banking days from acceptance of this Offer.”

Sometimes the financing timeframe is extended beyond five banking days, but more often, I typically see a 5-day window assigned.

The requirement to get your mortgage financing sorted out, within a set number of business days, is a very important time for the purchasing clients and for the real estate agents who represent both sides of the transaction, the buyer of the home and the seller of the home. Without financing, the purchase offer would be become null and void and the buyer’s deposit money is returned to the buyer.

As I have carefully navigated through several purchase deals and have organized financing for several clients, let me assure you that the time assigned to obtain the financing is often fully utilized and can even be a tight timeline to fulfill depending on factors which are often out of my own control. Let me take you through an outline of exactly what transpires during this very important timeframe so that you can clearly understand why the process can take this much time. I have allocated the financing process into a 10-step process.

Please click here to see the 10-step process.

1. If the buyers have not yet started a mortgage financing application, they will need to make arrangements to provide full disclosure on a formal mortgage application. This would include their residential status, marital status, employment status, income, disclosure of current debts, and all other financial obligations, that the buyers may already have. The application is created and a credit report is retrieved.

2. Once the application is complete, it is then forwarded electronically, along with the attached credit report, directly to the chosen bank/lender.

3. The application is received by the lender and will be assigned to the lender’s underwriter. It is important to mention that underwriters receive many applications and so therefore the timeframe to receive attention on a submitted deal can be a day or two.
Once the underwriter has accessed the application, it is here that the application is carefully reviewed and considered. If the application has been carefully prepared, and there is no missing information, and details regarding the applicants have been carefully and properly documented, and a proper determination was made on the applicant’s ability to receive financing, the application would then receive approval by the underwriter.

4. The underwriter will prepare a mortgage commitment for the applicant(s).

5. Within the mortgage commitment, the underwriter will assign a list of conditions. These conditions will be outlined, within the mortgage commitment. A sample of these conditions might be:
a) applicants to provide proof of income;
b) applicants to provide recent pay stubs;
c) request for a full appraisal on the property;
d) confirmation of proof of downpayment…..etc.

6. Once the mortgage commitment is forwarded back to me, it is at this point that the clients are informed of the list of criteria that the lender has provided. The list of conditions would have to be carefully reviewed and as long as each item can be fulfilled, the possibility of the full approval is almost near. While it is preferable to gather documents before buyers enter into a purchase position, it is not always something the buyers fulfill up-front.

7. All documents required by the lender, per the mortgage commitment, are then forwarded to the lender for review.

8. The lender’s fulfillment administrator, will then carefully review all submitted documents.

9. If the lender’s fulfillment administrator has approved each document, then an approval on the documents would be provided.

10. It is only when the above items have been fulfilled that a decision is made to waive the financing condition, in the purchase document.

This blog was written by Elizabeth Blair, a Licensed Mortgage Agent with Mortgage Edge in Richmond Hill, Ontario. Elizabeth services mortgage clients in Mississauga and all over the Greater Toronto area.

You can contact Elizabeth directly by phone at (905) 510-5785
by email at eblair@mortgageedge.ca
or you visit her website at: www.missmortgage.ca

Elizabeth is licensed with the Financial Services Commission of Ontario and is also a Member of IMBA (the Independent Mortgage Brokers Association of Ontario) www.imba.ca

Lic # M08005880
Brokerage Lic # 10680
Head office is located at: 15 Wertheim Court, Suite 210, Richmond Hill, Ontario, Canada.

Making homes energy efficient

Protecting our environment and reducing the amount of energy we use has become a very important priority to many Canadians. With the added pressure of rising energy costs, assessing our own use of energy, around the home, is a great way to obtain much needed savings.

As I began to explore my own use of energy, I decided to find out what resources, tools and financial assistance, was available to start this “energy efficiency” journey.

I began this journey through a local company, “The Energuy”. I discovered that they provide an easy to navigate, one-stop service, for homeowners who want to improve their energy efficiency by showing them how to obtain savings and following through to also show them how to get money back for those improvements, all under one roof.

The first step would be to contact The Energuy to arrange a personal visit, from an experienced advisor, so that they can document their recommendations on where energy efficiency can be optimized, in the home. A detailed report would then be provided, to the homeowner, which would outline what changes or upgrades could be made to obtain those energy savings. The homeowner would then use this report to carefully consider their options. Some examples might be, a recommendation to change older windows and doors, install new improved heating and cooling systems, upgrade insulation, etc. The homeowner can then decide when they would like to proceed with some or all of the recommended energy improvements.

I also discovered that homeowners can receive grants, from the Federal and Provincial Government, after following through with the recommended energy upgrades. These grants can total, up to $10,000. The Energuy will then substantiate compliance with energy upgrades to help you complete the overall application process. Finally, you would then be able to receive up to $150 for the intial assessment cost.

The Energuy can be contacted at (905) 824-4922 or you may visit their website at: www.energuy.ca for more details.

This article was written by Elizabeth Blair, a Licensed Mortgage Agent with Mortgage Edge in Richmond Hill, Ontario. Elizabeth services mortgage clients in Mississauga and all over the Greater Toronto area.

You can contact Elizabeth directly by phone at (905) 510-5785

by email at eblair@mortgageedge.ca

or you visit her website at: www.missmortgage.ca

Elizabeth is licensed with the Financial Services Commission of Ontario and is also a Member of IMBA (the Independent Mortgage Brokers Association of Ontario) www.imba.ca