Mortgage Intelligence

Oshawa's Mortgage News Desk!


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5 ways to plug the money leaks!

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The brisk back-to-work attitude of September makes it a great time to review your finances and particularly your spending. Whether you are saving to buy a home or pay one off, your “money leaks” can add up to some big bucks over time.  Here are five ways to find some of your missing money:

  1. Spending while unconscious. Track your spending and consider your impulse buys at the grocery, gas station, convenience and other stores; the services you are being charged monthly for that you don’t really use; or your brand name buying when generic will do. Look for the leaks, and then resolve to spend consciously. If impulse buying is a big culprit, always make a list and stick to it, only grocery shop once a week and never on an empty stomach!
  1. Convenience costs. It’s a lot easier to spend more than you intend to when you exclusively use your credit cards because you aren’t seeing the money. You just press some buttons and presto, your purchase is made. You might not be so liberal with your money if you actually had to hand it over. Consider withdrawing a fixed amount of cash for your spending every week.
  1. Examine your bills. Take a good hard look at your monthly bills and go through them line by line. Look for small, unexplained charges, fees, and add-ons. Some of them may be for services you don’t use or perhaps don’t remember requesting. Or they could be for services that you can actually live without. Even if the amount is small, why have it charged every month? 
  1. It doesn’t hurt to ask. Whether you are signing up for internet or buying a car, ask “is this the best you can do?” or “can you make it more affordable?” Do research in advance so you are prepared and knowledgeable on all things related to what you are buying.
  1. Plug your biggest money leak: high interest. All of the savings you make in lifestyle choices mean nothing if you don’t put a plug on paying high interest. Always pay down your credit cards as much as possible. If debt is choking your cash flow and you have enough equity in your home, you may be able to move that debt to your lower-rate mortgage and save thousands. If high interest debt is a big money leak for you, get in touch with the team at MiMortgage.ca. Using home equity to pay down debt is one of our specialties.


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Your mortgage could be a goldmine of potential savings

DB15036_financialconcepts_78997481A penny saved is a penny earned!  By making the right decisions, your mortgage could be a goldmine of potential savings.

With access to a broad spectrum of over 50 lenders, we’ll comparison shop on your behalf so you get the right combination of mortgage features and privileges that best meet your current needs, and offer you substantial opportunities to save money over the life of your mortgage.  Together we’ll look at term, fixed vs. variable, pre-payment and payment options, portability, assumability and any restrictions, penalties and fees.

Using your prepayment privileges and choosing a mortgage that has the most fair penalty should you want to get out of your mortgage early are tried-and-true ways to save money on your mortgage.

If you are like most homeowners, you are focused – for good reason – on finding the best possible rate.  Rate is important of course but cheapest isn’t always best. Some discounted mortgages come with very rigid contracts that could work against you in the future and actually cost you more in the long run.

You’ll also want to sharpen your focus at renewal time. Just as we did when we originally funded your mortgage, it’s important to investigate your options and make sure you are getting the best possible deal. Not auto-renewing your mortgage and making sure you get a fully discounted rate could save you thousands.

Also consider how much your time is worth. Time savings is a definite benefit of working with a mortgage professional. We look after every detail of your mortgage search and the negotiations on your behalf. Why not save time and money; let the experts at MiMortgage.ca show you how!

 


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Buying a fixer upper? Protect yourself from “sink or swim” renovations!

DB15036_reno_78281188So you’re one of those buyers who absolutely loves older homes: the character, the unique architecture, the settled neighbourhood… and maybe the great value. But even older homes with “great bones” sometimes need a little renovation to turn them into the home of your dreams. Unfortunately, sometimes on top of the home purchase price, a few costly renovations can sink you.

Good news. We’ve got a mortgage to keep you happily afloat.

We can bundle the cost of those immediate renovations right into the mortgage: so instead of sky-high credit card and line of credit bills… you’ve got your mortgage and renovations looked after in one easy monthly payment.

It’s called a “purchase plus improvements” mortgage. It covers the sale price of the home, plus any renovations that would increase the value of the property, up to $40,000. You also get pre-payments – so you can pay off your renovation faster.

Contact the team at MiMortgage.ca.We can take you through the process, so your mortgage and renovations go… swimmingly.


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This is the homebuyer of the future

DB14142_fb_homeowners_67276977_miThis past June, Mortgage Professionals Canada published their survey results on the Next Generation of Homebuyers; adults under the age of 40 who don’t currently own a home but expect to own in the future. If you are planning on buying, or help a child get into homeownership, these results can be an interesting comparison to your own situation.  Here are some of the key findings:

  • 52% are under 30 years old, 48% aged 30 to 39
  • 55% singe, 39% married/living with a partner
  • 81% have no children
  • 72% agree that mortgages are good debt, and 76% agree real estate is a good long-term investment. 58% are optimistic about the economy in the next 12 months.
  • The decision to buy is often influenced by key life events – start a family (33%), getting a promotion/raise (30%), getting married (29%), inheritance (8%).
  • Primary downpayment sources are personal savings (73%), gift/loan from a family member (36%), TFSA (33%) and RRSP (29%).
  • Average downpayment savings is $37,000 among imminent buyers.
  • Neighbourhood (61%), safety (58%), and potential for increase in value (50%) are the most important home features. Features that are considered to be worth a premium are nice neighbourhood (33%), short commute (31%) and safety (29%).

In terms of where to source their mortgage, 59% said they will likely use a Mortgage Broker once aware of their services. The top five reasons cited for using a mortgage brokers are –

  1. They are experts/specialize in mortgages
  2. Getting the best rate
  3. Help you negotiate a better deal
  4. Access to more lenders
  5. Convenient, one-stop shopping

Wherever you are in your homeownership journey, the experts at MiMortgage.ca are here to answer your questions and help you find the right mortgage, with the rate and flexibility you need to be a happy homeowner. Contact the team at MiMortgage.ca to speak to an expert now.


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Real estate and rates post Brexit and OSFI tightening

Image by courtsey of globalresearch.ca

Image by courtsey of globalresearch.ca

The uncertainty created with Brexit, in which Britons voted to leave the European Union, will keep interest rates low in the U.S. and Canada well into 2019 according to most economists.  The impact on Canada for both its real estate markets and interest rates looks bright.  Foreign money, in search of stable, safe havens for housing assets will naturally gravitate to Vancouver and Toronto now that Britain looks riskier. A continued low interest rate environment for many years will allow buyers outside of those areas to purchase with confidence, knowing that rates will remain low and affordable for some time.

The Office of the Superintendent of Financial Institutions (OSFI) on July 7th released a letter to all federally regulated financial institutions (FRFIs) to engage in prudent mortgage underwriting.  They are clearly concerned these low rates will continue to fuel the housing market, and want FRFIs to place increased focus on verifying borrowers’ income (particularly for sources outside of Canada), have greater scrutiny of loans to borrowers with high debt or low credit scores, and ensure borrowers can make mortgage payments if rates rise. As a result, mortgage applications will become subject to more scrutiny and requests for increased documentation. It has never been more important to deal with an experienced mortgage professional who has access to as many options as possible, including lenders not subject to federal regulations, and will work with you to ensure your situation is clearly represented with your lender.


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Which mortgage features are the most important?

DB14142_fb_financialconcepts_72644617_miIt’s easy to look online for a mortgage rate. But rate is only one aspect of saving money on your mortgage over the long term. It’s essential that you also consider mortgage features. Here are the big ones –

Early Payout Penalties. There are lots of reasons why it makes good financial sense to break your mortgage, even though you can expect to pay a penalty. But not all lenders calculate penalties the same way, and the differences can amount to thousands. Life happens, so make sure you choose a lender that has a fair prepayment penalty. And watch out for no-frill mortgages that don’t let you get out of your mortgage at all, unless you sell or the term is up.

Pre-Payment Privileges. You want the ability to put lump sum amounts on your mortgage and increase your payments so you can pay down your mortgage faster and save on interest. You should always consider having this flexibility even if you don’t think you’ll use it; your situation may change that gives you the ability to pre-pay. This flexibility can also help you reduce an early payout penalty.

Collateral charge mortgage. This type of mortgage can be difficult to transfer to another lender and cost you legal fees if you do. You are more locked in, which means your lender may not offer you the best rates if you need to refinance or at renewal.  Watch out!

Porting Flexibility. This is important if there is a chance you’ll move i.e. job change, growing family. You’ll want to take your mortgage to your new place to avoid penalties.  But make sure your lender lets you increase too should you buy a more expensive home.

Blended Mortgage. If you move or refinance, a blended mortgage allows you to blend the rate of your current mortgage with the rate on the additional funds. This way, you don’t break your current mortgage and incur the penalty. Some lenders blend and extend to a new 5 year term, others blend only to the remaining term, or offer both.

There is definitely more to getting a mortgage than just rate. Contact the team at MiMortgage.ca to speak to an expert now. It’s our job to help you find the right mortgage with the rate and flexibility you need to be a happy homeowner.

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