31 Mar

Innovative Mortgage and Investment Strategies


Posted by: Alisa Aragon-Lloyd

by Alisa Aragon-Lloyd, as seen in “New Condo + Condo Guide”

Most people believe that being mortgage-free is their plan for retirement. That means paying off your mortgage as fast as possible becomes the priority and having other forms of investments are considered only after your property is paid off.

It is important to decide what option will give you the balanced diversification and protect you from the real estate market and economic fluctuations.

One strategy is to be mortgage- free, so you will have minimal property expenses when you retire and have 100 per cent of the value of your home in equity. You will then have extra funds when you decide to down-size to a smaller home. But by putting all of your eggs in one basket, you could be limiting the ability to use other investment options that could give you a higher return on investment and would help you achieve your retirement goals faster.

By focusing on making extra payments towards your mortgage, making lump sum payments on your mortgage, or increasing your payments regularly, you would shorten the life of your mortgage, yet you are not investing into your RRSPs.

Here is the best of both worlds: By investing in your RRSPs, you pay less taxes, get a refund, and with that money you could make a lump sum payment on your mortgage every year.

Another option would be to put the equity in your home to work for you by using a HELOC (a home equity line of credit). This will give you access to your equity whenever you need it and would be a perfect investment vehicle.

Having a HELOC separate from your actual mortgage, gives you the flexibility to use it for investment purposes, therefore, the interest you pay on funds that are drawn from the home equity line of credit are tax-deductible.

Here are some investment ideas: Use the funds from the HELOC to purchase an investment property, and with the rental income you could cover the mortgage payments and property costs. The rental property would then pay for itself and you have a vehicle to help with your retirement goal.

Another idea is doing the “Smith Manoeuvre”. This means using the HELOC for short and long term investments. You do short-term, high-return investments, that when cashed, help you pay off the line of credit. Any extra money you have made, will allow you to make a lump sum payment on your original mortgage.

It is important to have a retirement strategy that works for you by exploring different ways that work with your lifestyle and goals. A comprehensive strategy can be put in place by working with your Mortgage Expert, Financial Adviser and Accountant.

9 Feb

Things to know before you start shopping for your new home

Mortgage Tips

Posted by: Alisa Aragon-Lloyd

by Alisa Aragon-Lloyd, as published in “The New Home and Condo Guide”, February 06th 2021.

For many people, there is a sense of pride and freedom when they become homeowners, which can’t be matched by renting. When you own your own home, you are not restricted by your landlord’s rules, and your mortgage payments are going towards building equity.

Buying a home is a big step. Here are some things to consider in advance.

  •  How long do you plan to live there? The transaction costs of buying a house that you have to take into consideration include legal fees, appraisals (if required), inspection fees, moving expenses, etc. If you don’t plan to live in your new home for at least 3-5 years, you may not gain enough equity to make selling worthwhile. In that case, you are probably better off not buying in the first place.
  •  How much house you need? Buying a cheaper, smaller house can end up costing you extra if you have to sell right away due to a growing family. On the other hand, buying more house than you need incurs extra maintenance, energy and tax costs.
  •  What is your credit rating? The higher your credit score, the lower your mortgage rate will be and the more you will qualify for. If needed, spend some time working on improving your credit. Check your credit report and correct any errors, don’t apply for any new credit, stay well below credit limits and pay your bills on time.
  •  Remember closing costs. While you are saving your down payment, save for closing costs too. The lender will require you to have at least 1.5% of the purchase price for closing costs.
  •  Test out what you can afford. Talk to a Mortgage Expert to analyze your situation in advance. We will give you an idea on how much house and monthly payments you can afford. To test how comfortable those payments will be, start saving that amount every month (less what you are paying now in rent). Not only will that simulate ownership, it also helps you save for a down payment!
  •  Get pre-approved. This is really the first step in the home buying process. Talk to a Mortgage Expert to get pre-approve for a mortgage. We have access to multiple lenders, options and will only use one credit report. The pre-approval tell you exactly how much you can spend before you start looking for your new home. There is no cost to use our services, yet we find better options for you.
  • Use a Real Estate Agent. Using a Real Estate Agent can help you focus your search, find the right home, save time and protect your interests. There`s no cost to the buyer to use their services.

A Mortgage Expert can help you navigate through the mortgage process and help you find the best mortgage for your individual needs.

26 Jan

What do you need to know about your first mortgage?


Posted by: Alisa Aragon-Lloyd

Traditionally, each spring, mortgage rates start to move, followed by a spring buying rush, with a lag in the summer, and then a second rush in the fall. This past year we saw everything upended. The spring buying season started with a positive outlook and abruptly came to a complete stall as the world figured out how to cope and live through a pandemic. This pause resulted in a fall season with strong home buyer demand eclipsing numbers seen in past years, trickling over into 2021 with little relief in sight.

Increase demand, coupled with record-low interest rates is now tipping Metro Vancouver towards a sellers’ market. What does this mean for the buyer, and more importantly, a first-time home buyer?

Any time demand outweighs supply, there will be an upward pressure on housing prices, and it becomes extremely important to ensure you understand the market, to leverage your buying potential.

Homeownership is a dream many of us have, and one that is attainable, if you leverage your equity to your advantage. Working with the experts is highly recommended, as the market continues to adjust.

Speaking with HAVAN member Alisa Aragon, Financing Expert at Bridgestone Financing Pros, Alisa suggests it is not enough to look for and find the lowest posted rate, pointing to relevant information in the fine print pertaining to penalties and flexibilities surrounding mortgages terms, and the impact on your end goal.

There will also be decisions to make surrounding the type of mortgage; fixed, variable or adjustable, noting each rate comes with a specific set of terms, varying by lender, so it is a good idea to shop around.
And speaking of shopping, knowing who to trust and where to look can be overwhelming.

In response to a COVID-altered market, and HAVAN recognizing the value in access to first-hand expert knowledge, the Home Buying 101 video series was launched to connect first-time home buyers with expert’s actively working in the real estate industry. Segmented into nine, easy to digest 10–20-minute videos, each presentation offers you free expert advice, packed with resources and information to help you buy smarter.

Considering buying a home is one of the largest investments you will make in a lifetime, and the impacts it can have on you and your family, both financially, and emotionally, it only makes sense to do your research upfront, before you sign on the dotted line.

Alisa’s tip: Don’t look at the maximum amount that you can afford, rather look to the maximum you want to pay each month, so you do not end up mortgage rich, and cash poor.

Check out the complete series at www.havan.ca/homebuying101

25 Nov

Pro tips for securing a mortgage


Posted by: Alisa Aragon-Lloyd

Vancouver has always been a challenging city to get a foot in the door. Add on a pandemic, and it gets even more complicated. HAVAN’s Home Buying Forum, typically held in-person each spring, but cancelled due to COVID-19, led to HAVAN producing a series of information videos to ensure first-time buyers have access to the knowledge they need to buy smarter.

HAVAN has captured the industry experts who typically present at the forum, in a series of nine 10-20 minute Home Buying 101 videos, packed with information and resources, to help people buy smarter.

Offering buying strategies, market knowledge, legal and mortgage advice, plus lots more, the videos are poised to help first-time buyers leverage their buying power. Record low interest rates and pent up demand from lack of spring sales has Vancouver poised to be a sellers market. It only makes sense to empower oneself.

I was invited to be in a video to talk about “Pro tips for securing a mortgage”.  Conducted by Shayne Ramsay, CEO of BC Housing, we discuss about interest rates and mortgages.

Check out the video series and share with your family and friends today!

15 May

A smart way to put your tax refund to work


Posted by: Alisa Aragon-Lloyd

Many people have already submitted their tax return prior to the deadline and some have started planning on how they will be using it. In general, it can be a real challenge to spend our money wisely, especially tax refunds, which may seem like free money. With the average Canadian getting a tax refund of approximately $1,400 it is tempting to spend it on something fun. However, every astute financial planner, adviser, broker or financial journalist will tell you that you should not aim at getting a large refund.

By definition, a tax return means you are giving the government an interest-free loan. If you want to get less in a refund, you should reduce the amount of money the government withholds from your pay cheque. To do so, you can increase the number of exemptions you claim. It’s usually smarter to saver the extra money all your long and earn interest for yourself.

While it is very tempting to use your tax refund on things such as a vacation, put a down payment on a new car or a big screen TV, there are many other ways to generate future value and accelerate your progress to financial freedom.

  • Contribute to your RRSP’s. Not only will you make that money tax free, you can use up to $25,000 of your RRSP’s towards a down payment as a first time homebuyer. As long as you put back 1/15 of the funds that you withdraw back every year you will not pay taxes on that money.
  • Start saving for a down payment for an investment property. By choosing the right property, the rental revenue will cover your mortgage payments and your equity will increase month after month.
  • Make a lump sum payment on your mortgage. This is a great opportunity to pay down your mortgage fast by making a lump sum payment. By doing so you will reduce the amount you pay in interest as your payment will go directly towards the outstanding principal. While you mortgage payments will remain the same, you will be closer in paying off your mortgage faster.
  • Invest in your personal or professional development. Take a course or attend a conference that will help advance your career or yourself. YOU will always be your best investment.
  • Do a home renovation. Investing in strategic home improvements it can significantly boost the value of your home, build your net worth and transform your living space into the dream home you have always wanted.
  • Make a charitable contribution. Not only will you be helping a worthy cause, you will lower you tax bill next year.
  • Pay down debt. Pay down some of credit cards or loans in order to relieve some of that financial stress. While putting money in savings is important, high-interest debt can counteract those efforts. By using your refund to lower your debt you can start putting more money in savings.
  • Start a contingency fund. If you don’t have one start a contingency fund or add more money to the one you already have. Realistically, you should have at least 3 months of your pay cheque saved. It can take a while to save but your refund can help you get there. You will be glad to have that money available when the unexpected happens.
  • Start your own business. Have you been thinking of starting your own business? Your refund can help you jumpstart your business. A little extra cash is a great way to get your new venture moving in the right direction. As you generate more income you can claim some small business tax deductions on your next year’s tax return.
  • Don’t forget to treat yourself. Remember to treat yourself when you make smart financial decisions. It will help you develop a positive relationship with money. If you spend all your refunds on debt or savings you will leave yourself feeling hopeless. Use a reasonable amount to treat yourself after you have already allocated the rest of the funds wisely.

Whatever you decide to do with your refund, keep in mind how hard you worked for that money, and make sure it’s working just as hard for you.

10 Apr

Building your homeownership budget


Posted by: Alisa Aragon-Lloyd

Making the transition from renter to homeowner is likely one of the biggest decisions you’ll make throughout your lifetime. It can also be a stressful experience if you don’t plan ahead by building a budget and saving prior to embarking upon home ownership.

Budgeting is a core ingredient that helps alleviate the stress associated with money issues that can sometimes arise if you purchase a home without knowing all of the associated costs – including down payment, closing costs, ongoing maintenance, taxes and utilities.

The trouble is, many first-time homeowners fail to carefully think about their finances, plan a budget or set savings aside. And in this society of instant gratification, money problems can quickly escalate.

The key is to create a realistic budget based on your goals. Track your spending and make your dollars go further by sticking to your budget once it’s in place. Budgeting offers a step-by-step formula for figuring out how to best save your hard-earned money to invest in homeownership.

Following are three top tips to help you prepare for the purchase of your first home:

1. Set up a savings account
You can deposit a predetermined amount into this account each pay period that you won’t touch unless it’s absolutely necessary. This will enable you to put money aside for a down payment and cover closing costs, as well as address ongoing homeownership expenses such as maintenance, taxes and utilities.

2. Save up for big-ticket items
As you accumulate money in your savings account, you will be able to also save for specific purchases to help furnish your home – avoiding the buy now, pay later mentality, which can have a negative impact on your credit when you’re seeking mortgage financing.

3. Surround yourself with a team of professionals
When you’re getting ready to make your first home purchase, enlist the service of a Licensed Mortgage Expert such as myself  and find a trusted real estate agent. Experts are invaluable as you set out on the road to homeownership because we help first-time buyers through the home purchase and financing processes every day. Experts can answer all of your questions and set your mind at ease. We have access to multiple lenders, and can help you get pre-approved for a mortgage so you know exactly what you can afford to spend on a home before you head out house hunting, while a real estate agent will be able to match your needs with a house you can afford. Both parties will negotiate on your behalf to ensure you get the best bang for your buck. And, best of all, these services are typically free. Experts will also be able to refer you to other reputable professionals you may need for your home purchase, including a real estate lawyer, home appraiser and a home inspector.

27 Jan

How Much Does Mortgage Rate Really Matter?

Mortgage Tips

Posted by: Alisa Aragon-Lloyd

A great discounted rate on your mortgage is worth nothing if it’s going to cost you thousands in penalties down the line. As seen in REW.ca.

More often than not, borrowers are fixated on their mortgage rate because it’s the one aspect of their home financing they know to ask about. But it’s important to look beyond the mere rates and look into the bigger picture surrounding what is significant when it comes to your specific mortgage needs. It is important to compare apples with apples.

If we dollarize the difference between 2.99 per cent and 3.04 per cent, for instance, it works out to an additional $2.66 in your monthly payment per $100,000 of your mortgage. Over the course of a five-year term, this culminates into just $159.60 per $100,000.

While “no-frills” mortgage products typically offer a lower – or more discounted – interest rate (like the 2.99 per cent used in the example above), when compared with many other available products, the lower rate is really their only perk.

The biggest problem with looking at rate alone is that you may end up paying thousands of dollars in early payout penalties if you opt for a five-year fixed-rate mortgage, for instance, and then decide to move before the five years is up.

No-frills mortgage products won’t let you take your mortgage with you if you purchase another property before your mortgage term is up – for example, portability is not an option with this product. Portability is an important option that could save you money over the long term if the home of your dreams is within your reach before your mortgage term is up and rates have risen, which they have a tendency to do over a five-year period.

This type of product is only plausible for those who have minimal plans to take advantage of benefits that will help pay off your mortgage faster – such as pre-payment privileges including lump-sum payments and increase your mortgage payments between 15 and 20 per cent without penalties.

Other things to consider is whether you are getting into a collateral mortgage or a conventional mortgage. Unfortunately, many people don’t realize they have a collateral mortgage until it comes time to renew and they don’t have the flexibility they need.

It’s understandable why these products may seem appealing. After all, not everyone feels they have the extra cash to put down a huge lump-sum payment. And who needs a portable mortgage if you’re not planning on moving any time soon?

But it’s important to remember that a lot can change over the course of five years – or whatever term you choose for your mortgage. You could get transferred, find a bigger house, have children, change careers, separate from your spouse, etc. Five years is a long time to be anchored to something.

Many people won’t sign a cell phone contract for longer than two years that they can’t get out of, so why would they then sign a mortgage for five years that they can’t get out of?

The thing is, you can still obtain great mortgage savings without giving up the perks of traditional mortgages. For starters, many lenders are willing to offer significant discounts if you opt for a 30-day “quick close.”

And there are many other ways to save money. For instance, by switching to weekly or bi-weekly mortgage payments, or by obtaining a variable-rate mortgage but increasing your payments to match those of the going five-year fixed rate, you will be ahead of the typical discount of a no-frills product before you know it and you won’t have to give up on options.

Banks don’t give anything away for free – they are there to make money. That’s why it is essential to discuss the full details surrounding the small print behind the low rates. It’s also important to take into account your longer-term goals and ensure your mortgage meets your unique needs now and into the future. As mortgage experts will help you find that balance by finding the best mortgage for you.

27 Dec

Thirteen things you need to know BEFORE renewing your mortgage


Posted by: Alisa Aragon-Lloyd

Is your mortgage coming up for renewal? Don’t be too quick to sign that mortgage renewal letter. More than 70 per cent of Canadian mortgage holders do just that, and what is the usual result? A higher rate and a mortgage product that might not be best suited to their interests.

Experience has shown that the “Big Banks” send their mortgage renewals out at a posted rate. Lenders are counting on the fact that most homeowners are too busy to ask questions or to inquire about getting a better rate. Don’t let this happen to you!

You should recognize that you are now negotiating from a position of strength as your renewalmortgage principal has dropped and in most cases your home value has increased. Lenders see you as a lower risk borrower and consequently you should be getting the best rates available. That may not happen if you simply sign the renewal document provided by your existing lender.

Rather, let the lenders compete for your business to be sure you do in fact get the best mortgage possible.

The following are some things you need to consider before you renew your mortgage:

      • Mark your calendar or digital organizer for four months before your renewal. On that date, start re-evaluating your needs to see what type of mortgage is likely to fit best this time. Start researching the market for products, features, interest rates, lenders and interest rate trends. If this sounds like too much work and you are leaning toward simply signing your bank’s offer when it arrives, ! Instead, take the easy route and let a mortgage expert do all the work for you, for free. Start taking action on your renewal 120 days (four months) in advance.
      • If you do nothing else, simply pick up the phone when you receive your bank’s renewal notice, thank them for the interest rate they have offered and ask them if they can bring it down a little. In most cases, they will say yes. Of course, you should wonder, “If I can get a lower rate by simply asking for it, imagine how much better rate and features I could get if I had a mortgage expert playing hardball with several competing banks!” Ask for a lower rate.
      • See renewal as a time to start over. So much may have changed in your life since you first took out your mortgage. It would be foolhardy to lock yourself into exactly the same mortgage at an unnecessarily high rate just because your bank doesn’t want to take the time to provide a financial review and make a more current recommendation. And don’t think this has to take up a lot of your time. Mortgage experts can perform a full review in a few minutes, whenever and wherever is most convenient for you.
      • Attractive new mortgage products and features may be available that you’re not aware of. New mortgage products are being introduced all the time. Not only do some offer better rates, they may also offer better pre-payment options, cash backs, amortizations, accelerated payment schedules, investment opportunities and more. But you will never know if you simply sign up for more of the same.
      • The rate market may have changed dramatically. When you first took out your mortgage, you may have gone variable because rates seemed to be continually dropping. But what if the economy and interest rates have shifted in the meantime, as they have recently? Maybe it’s time to consider locking in so your payments don’t start creeping up month after month. But you will never know if you simply sign up for more of the same.
      • You are not obliged to renew into the same kind of mortgage, nor are you obliged to stay with the same bank. When your mortgage term is up, all bets are off. Nobody owns you. Sometimes people feel loyal to a lender since the lender was good enough to lend you the money, you owe them your business. In reality, it’s a business transaction like any other. If the lender isn’t giving you the best rate, product, features and service, you have every right to take your business elsewhere. Of course, shopping around for the best alternative can be confusing and time consuming, so go to a mortgage expert to do all the legwork, comparisons and negotiation for free.
      • You can negotiate and play one bank off another. Again, don’t feel you are being disloyal by asking for a better deal or shopping around. Of course, you won’t be able to negotiate very effectively if you try to fit it within the 30-day window your bank gives you. This is another reason to start early. And it’s also a another good reason to use a mortgage expert – seasoned negotiators who know exactly how far to push each bank to get you the best deal.
      • If you can, pay down the principal. Renewal is a great time to put a lump sum down on your mortgage. There are no limits to how much you can pay. And since it goes straight toward your principal, even a modest amount can dramatically reduce your amortization and total interest costs.
      • Renewal is the best time to refinance. If you are thinking about taking out equity from your home for renovations, investments, children’s education, debt consolidation, etc., do it at renewal time. Since your mortgage term has ended, there are no early payment penalties, which can save you thousands of dollars.
      • Rate isn’t everything, but it’s tremendously important. Accepting your bank’s first renewal offer is like leaving money on the table. You can do better by shopping around yourself, and you can do MUCH better by letting a mortgage expert shop for you. Shaving a point off your rate can save tens of thousands of dollars over the life of your mortgage.
      • Don’t be scared off by fees to switch lenders. Your existing lender may tell you there’s a discharge fee if you move your mortgage. But don’t worry. Most lenders let you include the discharge fee into the new mortgage and it’s a minimal cost considering how much you can save in interest.
      • Make sure switching lenders is worth it. In almost every case, it’s very much worth your while to switch lenders if that’s what it takes to get a mortgage and rate that fits your needs best. However, keep in mind that moving to a new lender involves some extra steps. Since it’s a new mortgage, you have to go through the application process again, proving your income and getting your credit checked. In some rare cases, the tiny amount you would save by switching lenders may not be worth all this extra work. But even in these cases, it’s definitely worthwhile to have a mortgage expert review your situation and shop the market for you. A reputable broker who is looking after your best interests will tell you if it is optimal to stay with your existing lender.
      • Even if you get a lower rate, keep your payments the same. Sure, with a lower rate, you could enjoy lower payments and increased cash flow. But if you keep your monthly payments the same as they were when your rate was higher, you will pay off your mortgage sooner and be well on your way to financial security.

So if your mortgage is up for renewal, talk to a mortgage expert, who will be happy to provide you with a free consultation by reviewing your current situation and ensure you get the best rate and terms available.

As seen in REW.ca.

13 Sep

What If I Don’t Have the Full Down Payment?


Posted by: Alisa Aragon-Lloyd

Raising a down payment can be the trickiest part of buying in Vancouver’s hot market – but some programs may help. As seen in REW.ca

Q: I really want to put in an offer on a condo, but I haven’t raised the full down payment amount yet? Do I have any options?

A: The minimum down payment required is 5 per cent of the purchase price of the home you are buying – if you are employed. For those who are self-employed, it will depend if you are qualifying based on what you are declaring on your income tax then it will be 5 per cent, and at least 10 per cent if you are self-employed and qualifying with an “estimated” gross income instead of the income showing on your tax return. And if you want to avoid paying mortgage default insurance, you need to have at least a 20 per cent down payment.

However, there are programs available that enable you to use other forms of down payment when you don’t have the full down payment.

  • RRSPs: If you are a first-time home buyer,income-report you can use up to $25,000 from your RRSP without paying any personal taxes. However, you will have to repay any amount withdrawn from your RRSP for down payment of a home purchase.
  • Gift from a family member: You can get money gifted from a parent, child or sibling to go towards the down payment. The lender will ask that the person that is giving you the gift signs a letter stating that the funds are a gift and are not to be repaid.
  • Borrowed down payment: You can borrow from a line of credit, get a loan or use your credit cards to complete your down payment. However, in order to qualify, you still have to be within the Total Debt Service (TDS) ratio. The TDS ratio measures your total debt obligations (including housing costs, loans, car payments and credit card bills). Generally speaking, your TDS ratio should be no more than 44 per cent of your gross monthly income.

Once you have raised the full down payment and made your offer, you will still need solid advice on which mortgage is best for you. By working with a mortgage expert, you have access to multiple lenders including banks, credit unions and other lenders that only work with brokers, which will ensure that they can find the best mortgage for your individual needs.

16 Jul

Frequently asked questions when buying a home


Posted by: Alisa Aragon-Lloyd

As seen in the Metro Vancouver New Home Guide.

What do lenders look at when qualifying me for a mortgage?

Most lenders look at the following factors when determining whether you qualify for a mortgage:

  • Income
  • Debts
  • Employment History
  • Credit history
  • Value and marketability of the property you wish to purchase.
  • How much can I qualify for when buying a home?

In order to determine the amount for which you will qualify, there are two calculations that are used. The first is your Gross Debt Service (GDS) ratio. GDS looks at your proposed new housing costs (mortgage payments, taxes, heating costs and strata/condo fees, if applicable). Generally speaking, this amount should not be more than 35% – 39% of your gross monthly income. For example, if your gross monthly income is $4,400, you should not be spending more than $1,716 in monthly housing expenses. Second, your Total Debt Service (TDS) ratio is calculated. The TDS ratio measures your total debt obligations (including housing costs, loans, car payments and credit card bills). Generally speaking, your TDS ratio should be no more than 42% – 44% of your gross monthly income. The GDS and TDS will depend on your credit. Keep in mind that these numbers are prescribed maximums and that you should strive for lower ratios for a more affordable lifestyle. Before falling in love with a potential new home, you may want to get pre-qualified by a Mortgage Expert. This will help you stay within your price range and spend your time looking at homes you can reasonably afford.

How much money do I need for a down payment?

The minimum down payment required is 5% of the purchase price of the home when you are an employee. When you are self-employed it will depend if you are qualifying based on what you are declaring on your income tax then it will be 5% and at least 10% down payment when you are self-employed and qualifying with an “estimated” gross income instead of the incoming showing on your income tax return. In order to avoid paying mortgage default insurance, you need to have at least a 20% down payment.

If I don’t have the full down payment amount, what can I do?

There are programs available that enable you to use other forms of down payment, such as from your RRSPs, or a gift from a parent, child or siblings. Also, you can borrow the down payment from a line of credit, loan or credit cards. However, in order to qualify you still have to be within the TDS ratios as mentioned above.

What else do I have to pay to purchase a home?

You will have to pay for the closing costs. The lenders require you to have in your bank account at least 1.5% of the purchase price (in addition to the down payment) strictly to cover closing costs. You must have this amount but it doesn’t mean you are going to spend it. The following are some of the closing costs:

  • Legal costs
  • Property tax adjustments
  • Strata/ condo fee adjustments (if applicable)
  • Cost to register property in land title office, etc.
  • What would be my mortgage payments?

Monthly mortgage payments vary based on several factors, including: the size of your mortgage; whether you are paying mortgage default insurance; your mortgage amortization; your interest rate; and your frequency of making mortgage payments.

What is better a fixed or variable rate mortgage?

The answer to this question depends on your personal risk tolerance. For instance, you are a first-time homebuyer and/or you have a set budget that you can comfortably spend on your mortgage, it’s smart to lock into a fixed mortgage with predictable payments over a specific period of time. If your financial situation can handle the fluctuations of a variable rate mortgage, this may save you some money over the long run.

What is the best interest rate that I can get?

Your credit score plays a big part in the interest rate for which you will qualify,as the riskier you appear as a borrower, the higher your rate will be. Rate is definitely not the most important aspect of a mortgage, however, as many rock-bottom rates often come from no frills mortgage products. In other words, even if you qualify for the lowest rate, you often have to give up other things such as pre-payments and portability privileges when opting for the lowest-rate product. Remember not to focus on the lowest interest rate but on finding the best mortgage with the most favorable terms and rate. While you might end up having a lower rate, it can end up costing you thousands of dollars of unnecessary costs in the long run.

What credit score do I need to qualify?

Generally speaking, you are a prime candidate for a mortgage if your credit score is 680 and above. The higher you score the better, as you will have more options and advantages. These days almost anyone can obtain a mortgage, but the key for those with lower credit scores their options will be more limited and interest rates could be higher. But don’t worry consult a Mortgage Expert to see how they can help you in obtaining a mortgage.

What happens if my credit score isn’t great?

There are several things you can do to boost your credit fairly quickly. Following are five steps you can use to help attain a speedy credit score boost:

  1. Pay down credit cards. The number one way to increase your credit score is to pay down your credit cards so they are below 50% of your limits.
  2. Limit the use of credit cards. Racking up a large amount and then paying it off in monthly installments can hurt your credit score. If there is a balance at the end of the month, this affects your score.
  3. Check credit limits. If your creditor is slower at reporting monthly transactions, this can have a significant impact on how other lenders view your application.
  4. Keep old cards. Older credit is better credit. If you stop using older credit cards, the issuers may stop updating your accounts. Use these cards periodically and then pay them off.
  5. Don’t let mistakes build up. Always dispute any mistakes or situations that may harm your score. If, for instance, a cell phone bill is incorrect and the company will not amend it, you can dispute this by making the credit bureau aware of the situation.

To get more details about these and other questions you might have, give us a call and we will be able to analyze your personal situation and provide you with more information so you can make an informed decision on buying your home.