29 Jul

Know Your Mortgage Risks & Responsibilities

General

Posted by: Brad Lockey

While mortgages offer many benefits, they also come with risks.
Brad Lockey can help you understand both the benefits and the risks.

WORKING WITH A MORTGAGE BROKER 

There are many benefits to using a mortgage broker.1 Mortgage brokers are licensed professionals who can identify a large number of lenders and assess options for you. Mortgage brokers gather whatever information and documents are needed and make sure all the paperwork is complete and submitted for the lender to approve. They can also explain the process and answer any questions you may have. Before agreeing to work with a mortgage broker, there are a number of questions you should ask, including: Are you a licensed mortgage broker? What services do you provide and how will you help me? Do you represent the borrower, the lender, or both? How will you be compensated? How many lenders do you work with? 

BEING A RESPONSIBLE BORROWER 

Getting a mortgage is your decision. It is important to know how a mortgage will affect your finances and possibly your lifestyle. Consider these factors when making your decision: 

BUY ONLY WHAT YOU CAN AFFORD 

How much will it cost? How will it affect you? Can you continue to make the payments for the entire length of the mortgage? How stable is your income and employment? Will you still have enough money left for the other things in life you need or want? What other expenses are involved in the purchase (e.g.– legal fees, appraisals, taxes, moving expenses…) and how much will they cost? 

THINK ABOUT THE RISKS IF YOU CAN’T PAY

Not paying your mortgage on time and in full can lead to penalty fees, default and even foreclosure. 

UNDERSTANDING YOUR MORTGAGE CONTRACT 

Like most legal contracts, a mortgage can be very complicated. It is important to understand what you are committing to. Here are key elements of any mortgage contract that you should understand: Total cost of a mortgage Interest rates Preparing for the renewal process Finding the right payment option Fees and penalties 

BEING AWARE OF OTHER MORTGAGE RISKS 

BE ACCURATE AND HONEST. 

Errors can lead to an unsuitable mortgage; providing false information is illegal and can lead to serious consequences. 

DON’T BECOME A STRAW BORROWER. 

Never pose as the purchaser of a home or apply for a mortgage for someone else. It’s illegal. 

SAY “NO” TO CASH PAYMENTS. 

Never make payments, especially cash payments, without receiving a receipt. All payments for mortgage broker services are to be made to the brokerage. 

THINK BEFORE USING A MORTGAGE TO INVEST IN SOMETHING ELSE. 

If you are taking out a mortgage to invest into something else, be sure that you understand all of the risks of the investment. 

BEWARE OF OFFERS THAT ARE TOO GOOD TO BE TRUE. 

Be careful before you agree to any offers to help you save on your mortgage. Some plans that promise savings end up costing you more. When in doubt, ask for a second opinion. 

 

Contact me at your convenience at 416-518-7476 or mortgages@bradlockey.ca

22 Jul

Fewer Paying Extra on their Mortgages

General

Posted by: Brad Lockey

 

Compared to even six years ago, today’s interest rates are a steal. The discounted 5-year fixed has tumbled more than 2.25 percentage points in that time. That gives mortgagors a chance to pay up to 30% more principal in the first five years of a standard mortgage.

But that savings potential isn’t motivating more people to pay extra on their mortgage, at least not according to a new poll. CIBC has found that 55% of today’s mortgagors are accelerating their mortgage amortization, down from 68% in the same survey last year.

CIBC doesn’t get into detail about how people are redeploying their spare cash, but it suggests that home renovation and summer vacation spending are up 30% and 20% this year, respectively.

The average age that Canadian mortgagors expect to be mortgage-free also rose a bit. It’s now 58, compared to 57 last year.

In B.C., however, the typical homeowner plans to keep their mortgage past retirement age and not pay it off till 66. At this pace, it may not take long until a sizable minority of B.C. residents are bequeathing mortgages to their kids.

Additional findings from this year’s poll (among those with mortgages):

  • 32% accelerated their payment frequency (vs. 42% in 2013)
  • 28% increased their payment amount (vs. 30% in 2013)
  • 18% made a lump-sum prepayment (vs. 15% in 2013)
15 Jul

High End Home Sales Booming Across Canada

General

Posted by: Brad Lockey

Sales of houses that cost at least $1 million are booming in Canada’s four biggest cities, high-end real estate firm Sotheby’s International Realty Canada says.

Sales of homes priced higher than $1 million increased in Vancouver, Calgary, Toronto and Montreal, the firm said in a report published Tuesday. But as with other segments of Canada’s housing market, demand for luxury homes isn’t increasing evenly.

In the first half of 2014, overall sales in the million-dollar-plus category were up by more than a third compared to last year’s level in Toronto and Vancouver. But Toronto was the only place in Canada where sales increased in all categories of housing that Sotheby’s tracks — condos, attached homes and detached homes.

“Given strong economic fundamentals, increased consumer confidence and mortgage lending rates that remain at historical lows, all markets are expected to gain momentum in the latter part of 2014,” the realtor firm said.

canada housing realtor real estate

Sales of million-dollar homes are booming across the country, according to a real estate firm that specializes in that segment of the market. (Daniel Acker/Bloomberg)

It is single-family homes, however, that generally can command a premium on the price side. In all four cities tracked, there was an increase in the number of single-family homes that sold for above the listed price.  In Toronto and Vancouver, more than 30 per cent of luxury single-family homes sold for more than the asking price. In Calgary and Montreal, the number dropped to a little under 10 per cent.

Although it was the smallest growth of the four cities tracked, Montreal’s 11-per-cent sales uptick of all types of luxury homes stands out because Quebec’s largest city posted an overall decline in sales in 2013.

In all, there were about 6,400 homes that sold above $1 million in the four cities in the first half of 2014, including about 275 that sold for more than $4 million.

The most expensive home cited in the Sotheby’s report was located in Vancouver and was listed at $15 million.

Other things of note in the regional findings include:

  • Calgary’s condo market saw fewer sales of condominiums priced over $1 million in the first half of 2014 compared to the year prior, a trend that the company chalked up to there being fewer homes listed in that price point.
  • Between January and June, a total of 3,956 homes were sold for more than $1 million across the Greater Toronto Area. That’s a 34 per cent jump compared to the figure from the same period in 2013.
  • Despite a soft start to the year, sales of million-dollar homes in Montreal started rebounding quickly after the Quebec election in April, when the separatist Parti ​Québécois was soundly defeated.

According to the latest data from the Canadian Real Estate Association,the average home in Canada sold for $416,584 last month, a seven per cent increase compared to the same time last year.

At the end of this month, Canada’s taxpayer-backed housing agency, the CMHC, will stop insuring homes that cost more than $1 million, even if the buyer can come up with the minimum downpayment of 20 per cent. That means that starting in August, a would-be buyer of a million-dollar would have to get somebody else to insure the purchase. 

The housing agency says loans like that only represent about three per cent of all the loans it backed last year.

 

By Pete Evans, CBC News Posted: Jul 08, 2014 12:01 AM ET

15 Jul

CHIP

General

Posted by: Brad Lockey

CHIP Home Income Plan has helped thousands of people in Canada who were looking for a simple, sensible way to draw upon the equity built up in their homes.

Dominion Lending Centre has identified this great opportunity for its brokers. There is a very large market with recent studies proving there is currently only 10% penetration in this Reverse Mortgage sector. Seniors are the fastest growing segment in the Canadian Market place.

CHIP Mortgage Solution- Reverse Mortgage, who qualifies?

– Home owner age 55 and older
– No income qualification
– No Credit Requirement
– Qualify for up to 50% of the home’s Value, based on clients age, property area, description and value
– Money can be received as a lump sum, planned advances over time or both
– No payments required until the house is sold or both owners move out
– Owner maintains title and complete control over their home

Contact me for more information!

 

 

 
8 Jul

Home Renovation effect pushes spending

General

Posted by: Brad Lockey

‘HGTV effect’ pushes home renovation spending to record $63-billion


2 Jul

SHOO FLY! GET RID OF BUGS IN YOUR HOME

General

Posted by: Brad Lockey

So what’s an indoor bug fighter to do? We say, use household items to keep pests away! Here are some quick, toxin-free ways to keep bugs out of your home:

Note: These tips work best if you have a small, yet annoying problem. If you have a full-blown infestation, call a professional exterminator.

Ants 

If you suffer from daily ant invasions, the problem is likely twofold: easy ant-access points and food that’s left out.  To deter ants, move all of your food into air-tight containers. And, don’t forget to keep the sink clean! Dirty dishes, standing water and food in the drain all serve as sustenance for ants. Then, line any suspected entryways with a deterrent substance like cinnamon (ants hate the spice and will stay away).

Fruit Flies 

Put a piece of old, skinless fruit or some sweet wine in a bowl (a combination of both works well, too). Cover the bowl tightly with plastic wrap, and poke a bunch of small holes in the plastic with a toothpick. The fruit flies go in and can’t get out (make sure the holes are very, very tiny).

Silverfish 

To create a trap for silverfish, wrap the outside of a glass jar with masking tape and place a carbohydrate such as cereal or flour inside (their favorite food!). The tape will allow the silverfish to crawl inside, but they won’t be able to escape the smooth inner walls of the jar.

Mosquitoes

When it comes to skeeters, a fan is your best friend. Mosquitoes can’t land in a crosswind and hate flying against it, so they’ll avoid breezy areas. Sit directly in front of your fan and enjoy a mosquito-free afternoon. Cocktail optional.

Cockroaches 

To snare these prehistoric critters, create a non-toxic trap with water and soap. Pour water and soap into the bottom of a large jar. The water will attract the cockroaches, but they won’t be able to get out, and the soap will kill them. Note: This works best in a dry climate, because the cockroaches will be more desperate for water. For more tips, read: Pest Control: Cockroaches.

Crickets 

To stop the impromptu cricket concerts, place a few spoonfuls of molasses in a shallow bowl and then fill the bowl halfway with water. Set the bowl on the floor of the room where crickets are a problem. Crickets think molasses smells awesome, and they’ll hop into the bowl and won’t be able to get out.

Ladybugs 

These guys are great in the garden, but less welcome in your kitchen sink. Luckily, they hate the smell of lemon, so burn lemon-scented candles and use lemons to clean different parts of your home.

Moths 

The natural, flowery aroma of lavender repels moths. Purchase some fresh lavender and place it around your home in small, breathable bags (closets and drawers are always good spots). Tip: Cotton balls soaked in lavender essential oils work, too!

Spiders 

These creepy crawlers eat insects, so if you have a spider problem, chances are there are other bugs around that are attracting them. So, the best strategy is focusing on the above bug fighting tactics. If that doesn’t work, the next step is adding caulk to any cracks in the basement walls and window casings, which spiders either hide in, or use as entry points. For more tips, read: Pest Control: Spiders.