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Monthly Archives: January 2013

TD Bank Takes Heat Again for Collateral Mortgages

Since TD changed how they register mortgages I have steered clear of them.  Most don’t understand the big impact Collateral Mortgages charges make. Recently I had a client accept a mortgage from TD and even after I told them how it was going to be registered and what the true impact was, they still decided to move forward with them partly due to TD insisting that is not how things were.  Please visit to hear more: http://www.canadianmortgagetrends.com/canadian_mortgage_trends/2013/01/td-takes-heat-for-its-collateral-mortgages.html

 
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Posted by on January 30, 2013 in Uncategorized

 

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New Separation Program will help many divorce couples move on

Divorce, we all know someone affected by this, many stuck in situations they can’t change, many waiting for the sale of a matrimonial home. Well we now have an answer. If you have a legal separation, one party can buy the other party out with only a 5% down payment which can come from the equity in the home. This new program recently launched shall make an impact in a lot of people lives who have been sitting in limbo waiting for something to change. Call me if you need some help in this area

 

 
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Posted by on January 29, 2013 in Uncategorized

 

Bank of Canada Announcement

As you know, your variable rate mortgage, line of credit and/or student loans are all based on the Prime Rate and, as promised, here is your personal update from me on the recent Bank of Canada announcement on changes to their Overnight Rate which in most cases impacts your Prime Rate. 

At 10:00 am EST, Wednesday January 23rd, 2013, the Bank of Canada again did what we expected them to do… they continued to maintain their overnight rate.  What this means to you is that once again the prime rate on your mortgage, line of credit or student loan will not change and remains at 3.00%.  This of course is fabulous news but as always, I like to remind you to make the most of the low payments you still have as the rate will increase in the future.  Have you chatted to a financial advisor about a Tax Free Savings Account or some RRSP contributions to trigger a potential income tax refund next year as your payments continue to remain low?  If you don’t have a financial advisor, let me know and I’d be happy to recommend one to you.

 

Here is an excerpt of the announcement from the Bank of Canada and what they had to say about their decision:

The economic expansion in the United States is continuing at a gradual pace, restrained by ongoing public and private deleveraging, global weakness and uncertainty related to fiscal negotiations.  Despite a marked improvement in peripheral sovereign debt markets, Europe remains in recession, with a somewhat more protracted downturn now expected than in October. Growth in China is improving, though economic activity has slowed further in some other major emerging economies. Supported by central bank actions and by positive policy developments in Europe, global financial conditions are more stimulative.  Commodity prices have remained at historically elevated levels, though temporary disruptions and persistent transportation bottlenecks have led to a record discount on Canadian heavy crude.  In Canada, the slowdown in the second half of 2012 was more pronounced than the Bank had anticipated, owing to weaker business investment and exports. Caution about high debt levels has begun to restrain household spending

Based on this news, the Bank doesn’t expect the economy to reach full capacity until the second half of 2014.. much later than they projected.   Based on this, they are unlikely to increase their rate in the foreseeable future with any change most likely to occur possibly as late as Fall 2013 to early 2014!   Remember, that any increase to the prime rate since 1992 has only been by 0.25% at any ONE time, so you won’t see a large significant increase all at once.

 

Fixed rates haven’t changed much at all since the last announcement, at around 3.09% to 3.29% for a five year fixed term.

 

Based on this recent announcement, and the anticipation that the prime rate will still remain low for a while now, unless you feel otherwise, I’d recommend that you remain with your current variable rate product as the interest is lower than a fixed term rate right now.  However, if having a fixed payment is important to you, call me so I can calculate what your new payment would look like and also if it is suitable for you. The next announcement on any change to the prime rate is March 6th, 2013 at which time I’ll be in touch again.

 

I wonder if I can ask a favour – rates are still so low right now and it is a great time for refinancing especially to consolidate high interest debt or buying an investment property, as I can hold rates for up to six months.  Even for those that are thinking of purchasing their first home this year, it is a perfect time to work with me to not only hold rates but also work on their action plan to make dreams of homeownership a reality!  If you know of someone that is looking for advice on their mortgage options, with no obligation, would you mind passing my contact information on to them – this is very much appreciated.

 

I’d like to take this opportunity to wish you and your family a very prosperous and happy 2013… and keep warm!

 

 
 
 

 
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Posted by on January 23, 2013 in Uncategorized

 

How To Repair Your Credit Record

1.  Easiest & quickest way is to resolve items that are pulling your score down.

2.  35% of your score is determined by your payment history, so automate your bill payments

3.  Open a secure credit card that reports to the credit bureau.

4.  Pay off all outstanding collections.  Once paid off you can get an instant boost to your credit score by 15
points of more

5. Pay down revolving accounts such as lines of credit & credit cards

6.  Ensure your revolving credit balances are never over their limit.

7.  Don’t apply for a consolidation loan if you intend to purchase real estate

8.  Don’t shop for credit during a mortgage application

9.  Build and keep “active” credit

 

 
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Posted by on January 10, 2013 in Uncategorized

 

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Buying Real Estate with Damaged Credit

I often get asked if I can buy real estate with damaged credit.  The answer is it is not impossible, just more challenging.  Here are a few quick tips on how to do this:

1.  Buy owner occupied with income suites

2.  Rent- to Own Option:

3.  Joint Venture

 

Seek proper guidance froma mortgage broker ahead of time so that your properly prepared.

 
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Posted by on January 8, 2013 in Uncategorized

 

OFSI B20 rule changes and how they effect self employed

With OFSI’s new B20 rule changes many self employed are caught flatfooted. BFS borrowers make up 30 % of the mortgage market.  The biggest focus of the rule change is on the borrowers identification and and verification of the borrowers income.  Prior to the rule changes, BFS borrowers could easily apply for mortgages stating their income however now they will have to disclose more with T1 Generals, Notice of Assessments and Bank statements.  Self employed borrowers will now have to opt to draw more income personally and pay more personal income tax this year.  The goal is to bump up the borrowers personal income to a level that will allow the borrower to qualify for the level they are looking for.  Many self employed people often draw their income as a dividend but this is not the best strategy anymore, it’s good for taxes but not good for mortgages..  As always the most important is keeping impeccable paperwork and understanding what your goal is now and in the future and what you need to claim personally for income to make you qualify and start planning for that today and not when you are ready to buy.

 
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Posted by on January 7, 2013 in Uncategorized