Tag Archives: mortgage broker vs. banks

Which mortgage term will save you money over the next five years?

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A significant “negative shock” to the economy: That’s what it’s going to take to lower interest rates again, says Canada’s most powerful banker.

And Bank of Canada head Stephen Poloz isn’t betting on that happening any time soon. Neither are bond traders, the big guns that bet billions of dollars every day on the direction of interest rates.

So let’s suppose – just for fun – that they’re right (since we all know how often markets and economists aren’t right). If we are actually near a bottom in rates for a few years, what’s the best way to play your mortgage?

Well, it just so happens that there’s an app for that. It’s called a spreadsheet and I’ve taken the liberty (well actually the Globe & Mail has) of putting mine through its paces and model out which mortgage term (or combination of terms) yields the lowest hypothetical cost of borrowing over the next five years.

Keep in mind that what I’m about to tell you doesn’t apply to everyone. It presupposes that you:

  • Are a borrower who qualifies for the best advertised rates in the market;
  • Can handle higher interest rates and rising payments;
  • Are comfortable with making a five-year fixed mortgage payment.

But if any of the above listed points sound like you, lets read on…. (story via The Globe & Mail) 

As always if you have any mortgage questions THIS Kelowna mortgage broker is always ready to help 🙂

Mortgage tip of the week: Have your team of experts assembled

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Congrats, you have made the choice to jump head first into the housing market! Now get your team assembled…. Before you start looking at places speak to a mortgage broker and get a real estate team lined up. When it comes to buying a home, you usually have to make quick decisions – especially when you’re in a competitive market! In some cities, there’s a good chance you’ll have to make an offer on the same day you see a place, so there truly is no time to waste.

Start by getting pre-approved for a mortgage, so you know what your budget is and how much a bank will actually give you. Hire an experienced real estate agent who understands what you’re looking for and knows how to get it. Get the names of home inspectors and real estate lawyers in your area. And make sure your down payment is saved up and available to be withdrawn.

Happy hunting 🙂

All-in-one mortgage accounts & the benefit of putting your debt in one pot

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The whole premise seems geared toward keeners.

All-in-one mortgage accounts – a kind of mortgage account that acts like a big line of credit – seem aimed at the kind of borrower who uses every trick available to pay off the mortgage quickly, the type who can play an online mortgage payoff calculator like piano keys.

Sounds like you?

Continue reading here…… Story via The Globe and Mail

As always never hesitate to give me a shout if you have any questions, I’m here to help 🙂

5 Ways To Boost Your Credit Score

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I have spoken about credit a lot. It is one (but not the only) important piece of your mortgage puzzle. What can hurt you score, cant often times be more obvious than what can be done to help. Today I’m talking about the five things that you can do to improve your score, because the little number follows you whether you like it or not!

  1. Bring, and keep, your open accounts current. The most important part of your FICO score is a history of on-time payments. If an account becomes 30 days past due, you can lose a lot of points. It is much more important to bring and keep open accounts current than to handle old collection items of closed accounts.
  2. Reduce your credit card utilization. Utilization is defined as the percentage of your available credit that you are using. To calculate your utilization, divide your statement balances by your credit limits. If you have $10,000 of available credit and have a $1,000 balance, your utilization rate is 10%. According to data from Experian Decision Analytics, people with the best credit scores (above 780) have a utilization rate of 5.6%.

Continue reading…..

Story via Forbes

What to know about getting a U.S. mortgage

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You have made the big decision as a Canadian, you have hung up your skates and your tired of battling the snow and frost all winter! You have dreamed of having a “home away from home” but too far away from home….

Although Canadians and Americans share the same continent, live across from one another on the world’s longest undefended border and speak, mainly, the same language, there is one undeniable geographical advantage that the United States possesses in abundance: year-round warm weather locales.

This has led many Canadians to think about buying a property in a U.S. hot spot.

There are many mortgage pros and cons on top of the exchange rate…. to learn the more continue reading here.

How a simple credit error can ruin your home-owning dream

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Imagine the anxiety of watching your credit score unexpectedly plummet after spending your entire adult life maintaining good credit.

Now suppose this credit decline blocks you from getting a mortgage on the house you planned to buy.

That’s precisely what happened in this story, and it happens to mortgage applicants all across the country with surprisingly frequency.

All too often the culprit is unpaid phone bills. In this case, his cellphone provider sent the account to a collection agency after being just more than a month late on its cancellation fee. That caused his credit score to drop like a lead pickle, approximately 80 points (out of a theoretical 900) virtually overnight.

It never should have happened that way. Collections are meant for people who can’t or don’t want to pay their debts. But sometimes, for one reason or another, people honestly don’t know they’ve missed a payment. Reputable creditors make bona fide efforts to contact debtors for payment before taking this extreme measure. That didn’t happen here.

As a mortgage broker, I see this time and again. For most borrowers, it’s just a simple oversight. But as this case shows, an unnoticed cellphone charge can spell credit-score disaster. By the way, I learned the hard way that when you cancel your account, some phone providers stop automatically billing your credit card and e-mailing you outstanding charges. How thoughtful of them……

To continue reading & find out how to avoid credit drama just like this, click here (story via Globe & Mail)

How to get a mortgage (when your not the ideal borrower)

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If you’re a credit-worthy employee at a Fortune 500 company and don’t have much debt, the mortgage world is your oyster. Banks knock on your door looking to give you the best rates, most advantageous terms and any other perks they can use to get your business. You’re an A-lister. A borrower with impeccable credentials.

But what if you don’t quite fit that pic? It doesn’t mean you’re out of luck, it just means you have to learn how to work the system in your favour.

Truth: You can get a mortgage if you’re self-employed, got a poor credit history, or if you own more than three rental properties……

To help you, here is a list of some of the most common B-class borrower hurdles and the best ways to minimize the risks and get better mortgage rates and terms.

Have a read & as always, if you have ANY questions, never hesitate to get in touch.

Why The Big Short Won’t Happen In Canada

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Now that the wifey and I are empty nesters we get to all kinds of things we have never done before, like watch a movie, uninterrupted! After watching the recent Academy awards show (her choice btw) naturally my pick for movie night The Big Short. Great blockbuster that tries its best to explain why banks needed bailouts and homeowners found themselves in foreclosure with the U.S. market crash in 2008. If you’re worried that we’re next for a ‘Big Short’ in Canada, you can relax…..

Click here to read more about why the BIG SHORT won’t happen in Canada! 

 

Banks don’t provide proper pre-qualifications. Mortgage brokers do!

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Mortgage tip of the week & food for thought for those who are considering house hunting…

Before you run to the MLS listings, talk to a mortgage broker. First time home buyers should confirm their eligibility to purchase through a mortgage pre-approval in conjunction with their real estate agent. Mortgage brokers ensure FTHB’s are pre-approved prior to searching for property so a REAL budget is established and a pre-approval rate hold is tied down. If the client is already working with a realtor, that realtor can rest assured that the client is motivated, and looking in their appropriate price range. It saves all 3 parties involved a lot of time, and headache. A mortgage broker can be considered more valuable in this regard, as banks do not provide proper pre-qualifications based on a full application or review of documents, simply put, it leaves room for error.

If you have any questions NEVER hesitate to get in touch & stay tuned for more tips :