Without a doubt, even a small reduction in rates can mean interest savings over the life of your mortgage And it is our specialty to seek out competitive rates from a wide range of lenders. But we also look deeper. Sometimes a cut-rate mortgage comes with higher fees, penalties, or restrictive terms, which could prove more costly over the long term than a mortgage with flexible terms.

One of the best ways to save interest, for example, is to use pre-payment options. If you get a quarterly bonus, a tax refund, or a seasonal income boost, then you have some excellent opportunities to slash your mortgage costs. Putting extra money against you r mortgage principal could save you thousands of dollars in interest. If a cut-rate mortgage doesn’t permit pre-payments, that’s a huge missed opportunity.
We carefully examine mortgage features and privileges that best meet your personal situation, looking at:

• Refinancing penalties
• Fixed vs variable rate
• Term
• Pre-payment options
• Payment flexibility
• Restrictions
• Fees
• Portability
• Assumability

We make sure your mortgage is custom built for your personal situation, because the right combination of rate and features – matched to your needs – is the fastest route to mortgage freedom!

MORTGAGE RATES AREN’T WHAT THEY SEEM ANYMORE!

New mortgage rules announced October 17, 2016 have made mortgage rates extremely complicated. Rates are now all over the map, and the mortgage pricing matrix is very confusing. Several types of mortgages are now categorized as “uninsurable”: including some rental properties and “switch” mortgages that are moved to another lender, most 30-year amortizations, some refinance mortgages, and even conventional 5-year mortgages.

These mortgages are now charged a rate premium or some lenders no longer offer them.

GO SHOPPING WITH A FULL WALLET!

Before you go house hunting, we can advise you on how much mortgage you will likely qualify for, what your monthly payments will be, and can give you a rate hold for a specified period of time i.e. 120 days. This way you can shop within your price range, you don’t have to worry about rates rising, and both real tors and sellers will know
you’re serious. You also won’t waste any of your  valuable time looking at houses that are out of your price rang e. And by not underestimating what you can afford now, you can save over the long term if you don’t need to purchase a trade-up home later.

Pre-approvals do provide some security, but always remember to make your offer conditional on financing because your property will need to be assessed by your lender, and that condition gives us time to work with you to finalize your mortgage.

BENEFITS OF A PRE-APPROVAL

• Shop within your price range
• Don’t have to worry about rates rising
• Know w hat your monthly payments are so that you can start budgeting

To purchase a home in Canada, you need a minimum of 5% down payment. That’s 5% of the price you pay for the home if your purchase is $500,000 or less. For instance, for a $400,000 home, you need a $20,000 down payment.

What if the house you want is more than $500,000? Good question. Because the rules change. For any home over $500,000 but less than $1 million, you need 5% on the first $500,000… which is always going to be $25,000. And then you’re going to need ten per cent for any amount over that. So if your house price is $650,000, you’ll need your $25,000 plus ten percent of the extra $150,000… which is $15,000.That means you’re going to need to save up $40,000 for your down payment. If your purchase price is $1 million or more, a 20% down payment is required.

These minimum down payment amounts are Government of Canada rules, by the way, and they’re designed to maintain a good, stable housing market. And that’s why there is another important government requirement. If your down payment is between 5% and 20%, it’s also a rule that you have “high-ratio mortgage insurance.” The premium is almost always added to your mortgage amount. This insurance is there to protect the lender.

Saving for a down payment requires discipline and determination’ Whether you’re aiming for the minimum down payment (like most first-time homebuyers) or 20% down, there are some strategies to help you get there.

START SAVING

As early as you can, set up a dedicated bank account and start saving. Maybe a little off every paycheque. Your tax return. The extra funds from that long-awaited raise. The trick is to start thinking about where any extra funds – a little or a lot – can be funneled into your down payment account.

A GIFT FROM A FAMILY MEMBER

Perhaps you have someone willing to gift you the funds for your down payment That’s great… here are a few important requirements that your lender will have. Only a parent or other blood relatives like your grandparents can actually give you that money. And you’ll need a signed gift letter that says the funds are a gift and you are not required to pay the money back at any time. In other words, the money is a gift not a loan.

BORROW IT FROM YOUR RRSP TAX FREE!

Another way you could get some down payment funds… is from your own RRSP! The Federal Home Buyers Program (HBP) lets first-time homebuyers withdraw up to $25,000 TAX-FREE from RRSPs, as long as the money has been inside the RRSP for at least 90 days.

If you have contribution room, you can take whatever funds you’ve already saved for your down payment (up to $25,000) and put that into your RRSP just before the deadline, which is usually March 1. Then, whatever tax refund you get will further boost the funds you have available for your purchase. After 90 days, you redeem your funds under the HBP. Ifyou’re buying the home with a partner, then you can BOTH withdraw from your RRSP… for a total of $50,000 towards your home. Of course, you must both be first-time homebuyers. You’ll eventually need to pay back the withdrawn funds according to a repayment plan .. otherwise you’ll pay the income tax.

So, there are lots of down payment options available1 Some easy, some not so. That’s why if you are in the “saving up” stage of preparing for homeownership, this is a great time to meet.

Whether you’re a first-time homebuyer feeling your way into the housing market or an existing one looking to lower your mortgage payment, here are five reasons
why having renters help pay your mortgage is such an appealing option…

1. Some first-time buyers want to move directly into a single-family home and get mortgage assistance using a rental suite instead of purchasing a condo at a lower cost.
2. If you want to get your foot into the world of real estate without breaking the bank, a home with a rental suite can be a great start, especially if the area you happen to love is pricey.
3. Homeowners looking ahead to the future may want to lower their mortgage cost so they can channel money into other investment areas like RRSPs, TFSAs, RESPs. Or simply as a way to become mortgage free sooner!
4. Spending less on your mortgage can give you the freedom to change your lifestyle or follow your dreams, perhaps to travel, start a new business venture, or allow for the luxury of having a stay-at home parent.
5. Rental suites are also great if you have ageing parents. You can keep them close without infringing on personal space. Keep in mind that if tenants are family members, lenders and insurers will not use the rental income for qualifying purposes.

To access to the lowest mortgage rates, you need to show that you are a responsible borrower and will always make your mortgage payments on time. Your lender will look at your credit habits: do you pay your bills on time? Do you tend to run up your credit cards? These habits are reflected in your credit rating. To even have a credit rating, you’ll need two revolving sources of credit, for instance two  credit cards or a credit card and line of credit, that are each at least two years old.

Worried that some sloppy financial habits might keep you from a great rate or even from getting a mortgage? Then give yourself some CREDITI This important factor in your mortgage negotiation is entirely within your control. If you start right now with good credit habits, your rating will quickly improve. Here’s what’s important:

1. Pay every bill on time. That one habit is your single biggest game changer Make a commitment to never let a bill get past due.
2. Don’t run up your credit cards. Use the 50% rule. If your limit is $5000, never let the card go higher than $2500.
3. Don’t apply for credit too often. When you’re asked “would you like to apply for our Store Card to save $x dollars on your purchase?”
   Don’t do it. These pitches can be a credit pitfall.
4. Don’t ever let any bill go to Collections, even if it’s for a small or disputed amount. These black marks on you r credit are hard to eras e. If it’s
   happened, be prepared to explain why, and be sure it’s paid in full and reported to Equifax.
5. If you’ve ever been bankrupt or under a consumer proposal, you’re going to have some extra challenges. You’ll need to have been discharged for two full years. And you’ll need to prove that you’ve re-established credit after the discharge, with at least two re-established revolving credit items and a two year history of satisfactory repayment. Strong income and down payment will help.

If you need to polish up your credit, get in touch for a review of your situation and actionable tips on how to boost your credit rating.

To access the lowest mortgage rates, you need to show that you are a responsible borrower and will always make your mortgage payment on time.

Our goal is to make sure you are so completely satisfied with our service that you are happy to refer us to your family, friends and colleagues.

APPLICATION

We get to know you, and you get to know us too. We’ll discuss your situation, answer your questions, figure out your goals and talk about how we can achieve them. When we’re done, we’ll help you complete your mortgage  application in whichever way you’d like – on line, over the phone, or in person.

REVIEW AND PLAN

We’ll go over your mortgage application with a fine-tooth comb and get back to you fast – within one business day. When we do, we’ ll let you know about any other documentation you’ll need to get your financing. See sections 8 and 9 below so you can start collecting the documentation required. Once we have all the documents we need, we’ ll sit down to make a plan. This part is key – it’s when we find a lender with the right mortgage product for your needs.

EXECUTION

Now’s the time to put your plan into action. We’ll get in touch with you r chosen lender and put in your mortgage application. Once the lender has reviewed and approved your mortgage, we’ll take a close look at the  approval with you. This w ill help us sort out all the lender’s conditions, and make sure they’re satisfied.

FUNDING AND FOLLOW UP

Once all the lender’s conditions are satisfied, they’ ll submit the documents to be registered  on title, transfer the funds and the house is  yours’ Some brokers would say goodbye at this point, but we think your mortgage is way too important to leave you out in the cold. We’ll stay in touch all the way through, exploring every option to save you money and helping you prepare for the future.

Assembling everything your lender needs to verify your income is a critical component of mortgage success. A last minute scramble for documents just adds unnecessary stress. So as soon as you can, begin collecting the verification you need for your income type.

IF YOUR INCOME COMES FROM A FULL-TIME SALARY, your proof of income is pretty simple. You’ll need a recent pay stub, along with a “letter of employment” on company letterhead that confirms your position: your annual salary; and the length of time you’ve been in your position.

IF YOU’RE A FAIRLY NEW EMPLOYEE, lenders will want to know that your probationary period is over. Expect that your lender may call your employer. If you want to count your commissions and bonuses, also provide the last two notices of assessment so the lender can see what you expect to earn with these extras.

IF YOUR INCOME IS FROM COMMISSION, CONTRACT, PART-TIME, HOURLY OR SEASONAL EMPLOYMENT, you’ll need a company letter describing your work, and a pay stub to prove your income. And because the lender will want to look at how consistent your income is, include your last two notices of assessment or T 4 slips. If you work on contract, a copy of your contract and any renewals will be required.

IF YOU’RE SELF-EMPLOYED, you’ll need two years of notices of assessment, a copy of your business license or registration; or articles of incorporation, if you’re
incorporated. Also, provide a copy of your T1 general tax returns for the last two years OR the last two years of accountant prepared financial statements (if you’re
incorporated).

IF YOUR INCOME IS LOW OR DIFFICULT TO PROVE, a bigger down payment or an excellent credit history will definitely help bolster your case.

AND DON’T FORGET ABOUT OTHER SOURCE OF INCOME. For example, if you receive child support, have a copy of the separation/divorce agreement, and three to six months of bank statements to show the support being paid This should count for less than 30% of your total income.

IF YOU ARE A PERMANENT DISABILITY, get a letter confirming permanent status, and bring along a paystub. If you’re on maternity leave, your lender might use your full employment income if you can bring a letter of employment confirming your plan to return to work within one year. And finally, if it’s determined that you don’t have enough income to qualify for the mortgage amount you want, you can always check with family to see if they w ill go on title with you so you can use their income to help you qualify.

Once you are approved for your mortgage, your lender will want to be assured that you have not borrowed your down payment, so be prepared to show where your it is coming from.

IF YOU’VE SAVED UP THE MONEY, provide a 3-month history of the bank account(s) where the money has been building up. The statements should have your name on them; sometimes online banking printouts won’t show your name, so double-check.

IF YOU’VE HAD ANY LARGE DEPOSITS, show where they came from. If you transferred money from another account or sold investments, bring the records for those accounts too.

GOT FUNDS AS A GIFT? Remember to have you r signed gift letter. And bring a bank statement from the giver that will verify the funds Don’t wait until the last minute; be sure the funds are in your account no later than 15 days before closing.

USING RRSP MONEY? Provide a 3-month hi story of the account. Anything deposited in the last 90 days can’t be used for your deposit (or it will be fully taxed).

GETTING YOUR OWN MONEY FROM OUTSIDE CANADA? Make sure it’s in your Canadian account at least 30 days before you need it, and be prepared to show the usual 3 months of records from the out-of-country account.

PLANNING TO USE THE PROCEEDS OF THE SALE OF YOUR EXISTING HOME? Provide a firm contract of purchase, and your current mortgage statement.

And last but not least: DON’T USE UP YOUR LAST DOLLAR FOR THE DOWNPAYMENT. You’ll need to prove that you have an extra 1.5% of the purchase price to cover closing costs, which may include legal fees, appraisal fee, transfer ta x, home inspection, title insurance, interest adjustment, tax adjustment, and moving
costs.

You must be prepared to show where your down payment is coming from.

1. Keep your bills up-to-date, including your current mortgage ( if applicable).
2. Don’t add any new credit without consulting with me first, including co-signing a loan.
3. Keep the money for your downpayment separate so you have enough at closing to complete the purchase.
4. Have enough money set aside for other closing costs. Contact me for a list of the costs you can expect
5. Don’t pack any important documents relating to your mortgage/home.
6. Just before funding is not a good time to quit your job, move to part-time, or reduce your income. If your employment situation has changed, please contact me right away.
7. Don’t change your closing date without telling me first, and remember to satisfy all conditions of your mortgage approval at least 10 days before closing.
8. Get your home insurance in place, it’s an important part of your mortgage – lenders require it before advancing funds.
9. Talk to me about insuring this new debt with mortgage life and disability insurance.
10. ENJOY YOUR NEW HOME!