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.

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 links for home owners and home buyers

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 you happen to think of any new links that you would like to see listed here, please pass along your ideas to me and I will attempt to add them.  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

Or apply for the land transfer tax rebate

Visit the Government of Ontario, Ministry of Revenue website at:

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

 

Do you need to enrol 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 enrol 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 enrol 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 enrol 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 wnt your home assessed for its energy efficiency?

The Energuy

http://energuy.ca/ecoenergy/

 

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 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

 

Mississauga Mortgage Broker / Agent or Bank – the difference.

In Canada, people can use a Mortgage Broker, a Mortgage Agent or a bank employee usually known as a “Mortgage Development Officer” to get their mortgage in place.

As a consumer shopping for a mortgage, you may be asking, so what really are the differences between these ?   

Here is a table that I have created to help you compare:

 

	Mortgage Broker / Mortgage Agent	Mortgage Development Officer works for the Bank
Disclosure to Borrowers	The Mortgage Broker and Mortgage Agent are required to follow the disclosure stipulations per the Mortgage Brokers Act.   The Mortgage Broker and Mortgage Agent must inform the borrower about the mortgage transaction using a detailed document called the “Statement of Mortgage”.  The Statement of Mortgage contains details such as, legal description of the property, the loan amount, the term of the loan, the amortization period, the payment amount, the payment frequency, the total amount owing at the end of the mortgage term, the interest rate and a detailed breakdown of all other fees payable by the borrower, for example, broker fees or lender fees, etc. and the final effective cost of borrowing.   The Mortgage Broker and Mortgage Agent must provide a Statement of Mortgage to the borrower which shows what the effective annual interest rate is.	The Mortgage Development Officer is required to use disclosure documents that comply with the Bank Act.   The Mortgage Development Officer will provide details of the mortgage transaction to the borrower, however, the banks documents are not as “detailed” as the “Statement of Mortgage” document used by Mortgage Agents.                       The Mortgage Development Officer forms do not disclose the effective annual interest rate.
Disclosure to Investors	The Mortgage Broker and Mortgage Agents must provide detailed disclosure documents to the investor.  The investor is given adequate time to consider the investment opportunity before investing in the mortgage.	Mortgage Development Officers do not arrange financing with private lenders.
Product Offerings	Mortgage Brokers and Mortgage Agents are able to access the mortgage products of several lenders giving them access to various programs, lending options, and ability to shop and compare all of the mortgage rates available in the market.   Mortgage Brokers and Mortgage Agents can access financing through private lenders.	Mortgage Development Officers only have access to the products available with that particular bank.           Mortgage Development Officers do not arrange financing with private lenders.

 

 

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