Friday, April 29, 2011

Buying a “fixer-upper” but don’t have enough cash to do the fixing?

Have you searched high and low for the perfect home but can’t find one with all the upgrades you want? Maybe you’ve just saved enough for your down payment but don’t have the extra cash to change the furnace, replace the flooring, windows or whatever...let me help!
CMHC offers a Purchase-Plus Improvements mortgage that works wonderfully for individuals in this situation. The program allows you to purchase a home and add the cost of upgrades into the mortgage! This allows you to do the work now and improve the value of your home instead of adding the renovation costs to your credit card (with very high interest rates) or having to wait to save up the cash.
How does it work?
When you find a house that you want to buy, make a conditional offer (subject to financing). During your financing period, you’ll need to send me written quotes for the work to be completed. I’ll have them submitted to CMHC who will underwrite your file, and approve the quotes (OAC). Once you’ve taken possession you’ll have 12 months to complete the approved upgrades. Once you’ve finished them, just give me a call! I’ll let you know what documentation will be required as proof the upgrades have been completed. Once satisfied, your lawyer will be advised to cut you a cheque for the renovation totals. Easy as that!
If you would like more information on the Purchase-Plus Improvements Program, please contact me today!

Tuesday, April 12, 2011

Three charged in mortgage fraud case...

Three people have been charged in a massive mortgage fraud case in Alberta. Two men from Alberta, and one from B.C. are being charged with a variety of offenses in connection to fraudulent mortgage dealings. The case was investigated over a six year period and involves 97 properties and 15 mortgage lenders.
How did these alleged fraudsters do it? They approached other individuals to get a mortgage for them.
I think this case brings up a good opportunity to discuss this sort of thing. If you are ever approached to do something like this, don’t! It might sound like a good idea, perhaps maybe even too good to be true. Heed your Mother’s advice, “if it’s too good to be true, it probably is”. Mom always knows best!
This sort of thing is no joke and these schemes create very significant losses for the mortgage lenders and other victims involved.

Boring is good...

I’m going to keep this one short and sweet as I don’t really have much to report! The Bank of Canada, as predicted, left its key interest rate unchanged. What does this mean to you? The prime rate has stayed the same. If you have a Home Equity Line of Credit or a Variable Rate mortgage your payment’s going to stay the same. In this case, no news is good news!
The Bank of Canada’s next scheduled interest rate announcement is Thursday, May 31st 2011.

Friday, April 8, 2011

A moment in praise of Edmonton...

With today’s announcement of a brand new Royal Alberta Museum to be built downtown I must say that Edmonton really has it going on right now! This latest announcement is on the heels of news that the downtown arena also has the green light ( we just need to get Steady Eddy to cough up some coin).

We already have a beautiful city hall; a gorgeous new art gallery and now look forward to a new central museum and a state-of-the-art arena. The Anthony Henday is soon to be completed; Edmonton will enjoy a ring road to take us here and there in record time.

While every city has its pros and cons I truly believe that great things are on the horizon for this city. Experts are predicting an impending boom to start in the next 12-18 months; we have great jobs with lots of opportunity for those that want it, affordable housing, a great arts and culture scene, fantastic summer festivals and now a soon-to-be amazing downtown core with a new arts and entertainment district. I’m really proud of city council for having the vision to invigorate this city with new amenities and cultural institutions.

Tuesday, April 5, 2011

Get ready for the another one!

In a recent article in the Edmonton Journal, real estate guru, Don Campbell predicts that Edmonton is on the verge of another real estate boom.
Campbell, who is president of the Real Estate Investment Network, states that “Alberta is uniquely positioned in the world to be a stable, consistent and growing source of the four things that the world is going to need over the next decade- food, fuel, fertilizer and forestry.”
Campbell has over 19 years experience in studying the real estate market and has projected that the perfect storm is brewing in Alberta. His advice? Don’t wait until the market is in a frenzy until you buy. If you do, you’ll likely pay a higher price for the home and have to compete with other offers. His suggestion? Buy now but try to stick to areas close to the core of the city or areas to be serviced by the Anthony Henday expansion such as Castle Downs, St. Albert and northeast Edmonton.

Monday, April 4, 2011

Is a HELOC right for you?

Home Equity Lines of Credit (or HELOCs) have become a popular way to borrow money at a lower cost than a credit card or line of credit. Because you're essentially borrowing from the equity you've built up in your home, you can do so at a much lower interest rate - with a lot more flexibility.
This has enticed many homeowners across the country to take advantage of this mortgage product - volume-wise, HELOCs have grown by 170% in the last 10 years, according to the Bank of Canada.
What many homeowners tend to lose sight of is that this product is still a form of credit - and still has the potential to turn into burdensome debt.
Because they don't require any principle payments, and you have the option of making interest-only payments, it's easily-accessible cash that requires little discipline.
So if you've been thinking of getting a HELOC, what precautions can you take to avoid falling down a slippery, debt-laden slope?
Here are a few tips:
1. Go in with a plan. Establish ahead of time what you will use your HELOC for and what you won't. Some uses, such as consolidating higher interest debts, are maybe more worthy of tapping into your home's equity. A vacation is something that should probably be saved up for.
2. Don't pull down too much. Deciding on a "magic number" amount is important as well. Start with the end in mind, and only pull down an amount that you can realistically pay off in two to five years.
3.Borrow from your home to improve your home. Your home is likely one of your biggest investments, so it's important to strategically decide how much of that hard-earned equity you want to sacrifice. Typically, using equity to improve the value of your home is always a good move - especially if you decide to sell it soon afterward, and can use the increased selling price to pay off your loan.
-Courtesy of Axiom Mortgage Partners

Friday, April 1, 2011

Why use a mortgage Broker? Integrity, industry knowledge and service.

I was just browsing through First National’s website and found a great little information piece about mortgage brokers. I've been supporting First National since I began mortgage brokering. They are one of my favourite lenders because they have great turnaround times, solid mortgage rates, great broker service and fantastic underwriters. In their broker piece, they list some questions you should ask your mortgage broker before proceeding with them! If they can’t answer these questions to your satisfaction, move on! There are lots of great mortgage brokers out there!

Here are my answers to the questions posted on First National’s website:

1. How long have you been a mortgage broker? 4 years, full time. This is not a part time occupation; it’s my bread and butter!

2. How long has your company been in business? Mortgage Success has been around since the fall of 2008. My broker, Roberta Hardern, was previously a partner at River City Financial Services. She has a long background in mortgage brokering (10+ years) and oversees the day-to-day operation of Mortgage Success.

3. Can I get references from your clients? Yes! Please visit the testimonial section of my website. If you would like further in-depth testimonials please ask me and I would be happy to put you in touch with some of my past clients.

4. How do mortgage brokers make money? We’re paid by the lender that funds your mortgage.

5. What is your experience with this type of transaction? I have lots of experience arranging residential mortgages for first time buyers, self employed individuals, revenue property purchases etc.

6. What is the process for closing my mortgage? This is a long winded one, likely better explained when tailored to your individual situation.

7. How quickly can it be done? It all depends, see above!

8. Which lenders do you work with and why? I work with a variety of lending institutions. I do try to stick mostly with the larger players in the market and ones with solid reputations in the industry. I want you to be happy with your mortgage once you have closed your transaction so I always keep the lender’s reputation and client service history in mind.

Working with a Mortgage Broker (from First National's website)

Today, about 30% of Canadian homeowners arrange their mortgages through mortgage brokers – independent specialists with extensive knowledge of mortgage lenders’ product offerings, their features and benefits, and contacts throughout the lender community to ensure competitive rates.

What can a Mortgage Broker do for you?

Mortgage Brokers are experts dedicated to finding the right mortgage solution and simplifying the mortgage financing process. The Broker will take the time to understand your individual situation and tailor the best solution from among the hundreds of products available to today’s homebuyers. Brokers complete all the paperwork and keep up-to-date on industry issues and changes that could affect the decision you make about which mortgage solution is right for you. A Mortgage Broker will save you time. Comparison shopping involves going from lender to lender repeating your story, asking the same questions and analyzing the answers. That’s time most people don’t have.

On top of that, home financing is highly competitive and each product can be complex, which is why you should have an expert on your side. A Mortgage Broker will also work with you on strategies to manage monthly payments or improve your credit rating.

Questions to ask your mortgage broker: A Mortgage Broker will also work with you on strategies to manage monthly payments or improve your credit rating. As the term "broker" suggests, he or she gets paid a commission when originating or renewing a mortgage, so you don’t pay a thing!

1. How long have you been a mortgage broker? 2. How long has your company been in business? 3. Can I get references from your clients? 4. How do mortgage brokers make money? 5. What is your experience with this type of transaction? 6. What is the process for closing my mortgage? 7. How quickly can it be done? 8. Which lenders do you work with and why? Why use a mortgage Broker? Integrity, industry knowledge and service.