28 Aug

How to get the most out of an appraisal

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Posted by: Jeannie Stace-Smith

Awesome tips if you are going to have your house appraised!!!!

NEED AN APPRAISAL – 7½ TIPS FOR SUCCESS

Do you need to get a current value of your property? Then you are going to need an appraisal.

Banks and other lending institutions want to know the “current” market value of your home before they consider loaning money on the property. An appraiser checks the general condition of your home and compares your home to other similar homes which have recently sold in order to define a comparable market value for your home.

Here are 7½ tips that can help you get top current market value.

Short version – Prepare your home as if it was going to be sold!!

Long version… If a picture is worth a thousand words, think what kind of story the pictures from your home are telling?

In the world of mortgages, lenders seldom set foot on the property before making a loan decision.

Instead, they rely on their trusted list of approved appraisers. All a lender usually gets is the appraiser’s pictures of your property and their comments about how your home was appraised.

Tip #1 – Clean up. The appraiser is basing the value of your property on how good it looks. Before the appraisal, prepare your home as if you’re selling it. Clean and declutter every room, vacuum, and scrub. Do whatever you can to make your home as presentable as possible.
Tip #2 – Pay attention to curb appeal. An appraisal is all about first impressions. And the very first one the appraiser gets is when they walk up to your property. Spend an hour or two making sure the outside of your house, townhouse or condo is warm and welcoming.

Tip #3 – The appraiser must be able to see every room of the home, no exceptions. Refusal to allow an appraiser to see any room will be noted in the appraisal can be a game stopper. There are times when it is not appropriate for the appraiser to take pictures of certain things and appraisers and lenders understand this, but refusal to grant access could kill your deal.

Tip #4 – Make a list of upgrades and features. It’s important that the appraiser is made aware of any updates you’ve made, especially those which are hidden, like new plumbing and electrical. If possible, give the appraiser this list. That way they have a reference as to what has been updated and how recent or professional that work was done.

Tip #5 – If you need to spend to update, be prudent. Many people think “bathrooms and kitchens” are the answer for getting high prices on home value. They aren’t. First, consider that kitchen and bathroom remodels can be some of the priciest reno costs. For that reason, it may be more prudent to spend a bit of money, for just a bit of updating. Paint, new flooring, new light or plumbing fixtures don’t break the bank, but can provide a dramatic impact and improve your home’s value.

Tip #6 – You know your neighbourhood better than your appraiser does. Find out what similar homes in your neighbourhood have sold for. Your property might look like one down the street, but if you believe the value of your property is worth more, let them know why.

Tip #7 – Lock up your pets. I’m sure most appraisers like pets, but some may be put off by your cat rubbing against their leg or the dog barking or following them around.

Tip #7½ – One last tip – don’t annoy the appraiser with questions and comments and follow them around. Instead, simply be prepared to answer any of their questions and, if you do have concerns or queries, wait until they’ve completed their viewing of the property, then ask.

Mortgages are complicated, but they don’t have to be… Engage a Dominion Lending Centres mortgage expert!

KELLY HUDSON
Dominion Lending Centres – Accredited Mortgage Professional
Kelly is part of DLC Canadian Mortgage Experts based in Richmond, BC
26 Aug

MORTGAGES ARE LIKE COFFEE

General

Posted by: Jeannie Stace-Smith

Interesting article!

MORTGAGES ARE LIKE COFFEE

The most common question we get for mortgages is “what is your best rate?” Now imagine we walked into our local coffee shop and asked “what is your best price?” Doesn’t happen. There are all kinds of different coffees and lots of ways to make them. The same goes for mortgages.

Getting a coffee at the lowest price is usually not going to get you the coffee that meets your needs. You want quality beans, flavour, extra features like a shot of caramel, maybe make it a macchiato, froth on the top, an alternative milk option, and the list goes on.

The same goes for mortgages. Lowest rate mortgages may come with a lack of portability, the inability to make extra payments, and they may lock you into a good rate today without the flexibility for better rates in the future. They may be the lowest rate without the lowest monthly payment amount, they may be for term lengths that are too long and have significant penalties when the mortgage needs to be broken.

The lowest rate mortgage may be collateral charge mortgages that allow a bank to foreclose on your property because you were delinquent on your credit card payments while you went on an extended vacation in Europe and forgot to keep track while you were having so much fun drinking coffee at a popular little hole in the wall café in some small ancient village. The 4 strategic priorities that every mortgage needs to balance are lowest cost, lowest payment, maximum flexibility, and lowest risk.

So the next time you need a mortgage, treat it like your coffee order, don’t ask for the best rate, ask how you can get the best mortgage that meets your needs.

TODD SKENE
Dominion Lending Centres – Mortgage Professional
23 Aug

Back to School Tips!

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Posted by: Jeannie Stace-Smith

With just over a week until the kids go back to school I thought that this is timely!  I always struggled with the getting back to the getting up early routine!

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It’s time to re-train your child’s brain

Where did the summer go? Fall is just around the corner and “back to school” is on many parent’s minds. The challenge is getting school back on the mind of your “live-in” student. If you want your child to hit the ground running academically this school year, then it’s time to retrain their brain.

Schools around the globe provide a system of routines for maximizing learning that is specific to each student’s age and ability. Unfortunately, these routines have been breached with approximately 90-days of vacation and they need to be re-established prior to the first day of class. Here are 11 tips to help your student establish routines for a successful school year.

1. Re-set sleep patterns. Seven to ten days prior to the first day of school start the process of regular sleep. Wean the student off of going to bed late and sleeping late. Yes…you’ll probably cave to the “Mom, it’s my last weekend before school, why can’t I stay up late?” However, sleep patterns are crucial for reaching peak performance during the first class period and maintaining it until the bell rings to go home. Start this process sooner than later and help maintain it all year. Good luck on this one. Be bold. Be consistent.

2. Re-set eating habits. Once school begins the eating patterns of the student need to be set so that they can maintain a high level of energy throughout the day. The routines of breakfast, snack, lunch, snack and after-school snack prior to homework need to be implemented. In fact, the entire nutrition of the student needs to be well thought out 7-10 days before school begins. Someone other than the student needs to be the chief, family nutritionist.

3. Exercise the brain. Just like NFL conditioning and exhibition games that prepare each football player for the upcoming season, your student needs to warm up and begin to hone the basics of math, reading and writing prior to the school year. To allow your brain to stagnate for three months without reading is a travesty for super-learning and learning itself. Is it too late? It is what it is. But begin now to encourage reading and writing at least 7-10 days prior to the first day of school. If school textbooks for the upcoming year are available, start there with the first several chapters. In addition, math skills can easily erode over the summer. Have your student review the previous year’s math basics before they go to the next level.

4. Set academic goals. Establishing well-defined goals is one of the hallmarks of a champion. Each student needs these academic goals with corresponding strategies and tactics for reaching them. Set goals for each class and hold your student accountable.

5. Identify priorities. Football games, dances, playing video games, watching television, social media, homework, sports, extracurricular participation and friends are all part of each school year. Does academics top the list of priorities? When is homework to be accomplished? Before dinner? After school? After dinner? When can I watch my favorite TV shows? This 90-minute to 120-minute homework routine needs to be placed in your student’s schedule before the school year. Sunday night is a great night to prepare for the upcoming school week. This is a routine they can take into their adult life.

6. Social media. This activity gets its own mention. I believe Smart phones aren’t always smart. This device is your student’s pipeline to the rest of the world with emphasis on their peer group. Self-discipline and concentration don’t always mesh with the cell phone. No cell phone usage during homework. Period. No cell phone usage after certain hours (you decide the nightly cell phone curfew). As a student or guide to a student, you need to know three things about social media. What is my responsibility? What is my authority? And lastly, what will I be held accountable. Monitor this activity. You don’t need surprises. Keep abreast of where and when your student goes on the web and with whom they communicate.

7. Risk and reward. This subject needs to be addressed frequently with your student. Every thing they do or don’t do has a positive or negative consequence. What is the risk of doing this activity? What is the reward (or consequence) of doing this activity? The risk and reward “talk” needs to be given and repeated often.

8. Ask questions. Tell and yell does NOT work as a form of communication. Many of us have been raised with this form of information delivery. In order to turn your student into a viable and responsible decision-maker, then great questions will eventually produce great answers and ultimately great actions. Asking questions that can easily be answered with a terse and or mumbled yes or no are NOT great questions. Prepare this type of communication and be consistent. “What are your goals for grades and how are you going to accomplish this?”

9. The peer group. Birds of a feather flock together. Interview, research and keep tabs on ALL of your student’s friends during the school year. This definitely includes monitoring ALL social media. If you’re paying the phone bill, then it’s your phone NOT their phone. Your student’s “circle of friends” is the main influencer of how they approach homework, speech, dress, music and any other behavior. Police the peer group. Also, meet all parents of your child’s friends. This will tell you a lot.

10. Get ready Mom and Dad. Yes, as parents we need to prepare to assist our live-in students in setting, organizing and managing the best routines for maximum learning. This also pertains to family activities such as dinner, chores, family outings, sibling behavior, and community service. Of course, your student’s priority is preparing for their academic year and maintaining good grades. But do NOT forget family. This institution is the fabric of our country and needs constant building and repair. Make your student an integral part of the family. Keep them in the loop of all upcoming activities. Make the family name a brand each family member is proud to showcase in the community.

11. Allow for freedom of choice. Academic champions study with great self-discipline and commitment. They make sacrifices and choices. However, all students need some time to blow off steam and just hangout with friends or do nothing while chilling alone. Allow your student the time in their busy schedule to do this. Just be moderate. Grades first.

As parents we have the sole responsibility, accountability and the authority to oversee the education of our children. We can become best friends with them later in life. For now, we are the guides, mentors and coaches. We must be consistent in this endeavor. Be the coach. Be the teacher. Be the guide. Parent! This verb is NOT always cool, but it will reap dividends.

Pay now or you and your student will pay later.

Good luck Mom and Dad. You are the role models our students, schools, and communities need. Our country’s future depends on it.

Have an awesome school year!

America’s ZoneCoach®

22 Aug

How to get a 5% down payment for a $500,000 purchase

General

Posted by: Jeannie Stace-Smith

There are now more millennial’s in Canada then ever before hence there is more 1st time buyers than ever before. IF this is you then this article from my colleague Angela is a great read. Please check it out and call me if you have any questions.

How to get a 5% down payment for a $500,000 purchase

We have seen a return of the buyers’ market and many people are asking, how long will this last? While some renters without a down payment might be asking, how can o put a plan in place to own?

With the cost of living so high, and student debts coming out of school, many consumers question how they’re going to come up with a down payment for a home.

Here are some ways you can get it done.

  • Decide how much you can save and pick a plan that works for you:  a) A 36-month plan saving $700/month will get you $25,200 (you will need about $2,000 for closing costs if you qualify as a first-time homebuyer) b) A 24-month plan savings $600/month for $14,400
  • Get a gift from a family member
  • Borrow the down payment, or a portion (which may also help with credit building)
  • A combination of all of the above

For those of you that want to partner with government for down payment and profit of home ownership, a new government program can be a helpful tool provided it stays past the October election. https://www.cmhc-schl.gc.ca/en/nhs/shared-equity-mortgage-provider-fund

You might me reading this and thinking, ‘yeah right, that is not reality.’ Or for some people, you know it might just be exactly what will help them move forward.

Perhaps you have graduated from school and your parents don’t charge you rent. Imagine if you could put one of your paycheques every month aside and try living within those means and budgeting accordingly.

Or say you have a partner and one of you just started work in a specific trade and the other’s paycheque went towards the “home purchase plan.”

Also, if you are within the qualifications to buy, you will be earning a combined household income of $125,000-plus per year, so taking those funds right from your paycheque into your RRSP will have additional tax benefits too where you can use the refund for closing costs or amp up your down payment.

Here’s an example of how this worked for a lab technician and chef with a two-year old daughter.

They did a combination plan as they moved up to Canada from the U.S. two years ago, both got stable jobs and had no outside debt. They were paying $1700 a month rent. They used a $10,000 line of credit they took to put into investment to help establish Canadian credit. After getting the line of credit and placing it into a safe investment, they:

  1. Set up an RRSP and placed $600 a month on the loan and $700 a month into their RRSP.
  2. Now this family is used to having a cash outlay of $3,000 per month which will be the actual expectation they have for when they buy a home.
  3. With this plan, they take a mortgage for a test drive, save money on taxes, establish a great credit score and worked away toward their goal.

Are there holes in the plan? Yes, home prices may go up, there was interest on the loan they paid and they may have to adjust or modify their plan. Their employment can change, however, this practice will only benefit them no matter what life brings their way and there is a sense of empowerment when you have a plan and can see how you can get there.

Do you or someone you care about want to know how they can be set up with a multifaceted plan to help them move forward with a goal of owning a home?

Angela Calla
Dominion Lending Centres – Accredited Mortgage Professional
21 Aug

September 1 you can start qualifying for First Time Homebuyer Incentive!!

General

Posted by: Jeannie Stace-Smith

This is a awesome new incentive the Government is offering!  I have more details so if you have questions please reach out!

FEDS OFFER NEW INCENTIVES FOR NEW HOME BUYERS

In this year’s budget, the federal government announced a program for first-time homebuyers that would offer between 5% and 10% top up from the Canada Mortgage and Housing Corporation.

If you’re buying a brand new home, the CMHC will give you 10% of the total cost, and it will offer 5% if it’s an older construction.

The idea is to give people struggling to afford their first home a break on their monthly mortgage payments. Buyers would still need to put down at least a 5% down payment. Families will have to have a net income of less than $120,000 to qualify, according to news reports.

It’s not clear yet how the repayment process would work, whether you’d have to repay the money with interest when the house is resold, or by some other mechanism. But even if you do qualify for the new CMHC grant, you’ll still need to pass the mortgage stress test. That test measures whether you can handle not just the mortgage at the rate you’re signing for, but they also test when you can handle an additional two percentage points to that.

The Government of Canada has an online calculator where you can test whether you’ll qualify for a mortgage.

I’ve seen a lot of problems with the stress test, and think one thing the government can do is to re-introduce the longer 30-year amortization period. That’s going to allow people to be able to give them a little bit more latitude when they’re actually getting qualified for a mortgage.

It can have a big impact, and not just when you’re first buying the home.

I recently had a client who was a teacher earning about $78,000 a year. And just because they had a (new) car payment, all of a sudden because of the new stress test, they no longer qualified. This is someone with a good job, good income… everything is perfect.

If you have any questions about the new mortgage rules, incentive programs or refinancing, do not hesitate to contact a Dominion Lending Centres mortgage professional near you.

TERRY KILAKOS
Dominion Lending Centres – Accredited Mortgage Professional
Terry is President of North East Mortgages based in Ville Ste-Laurent, QC

 

19 Aug

Are you or do you know a first time homebuyer?

General

Posted by: Jeannie Stace-Smith

Check out this article if you are or you know a first-time homebuyer!!  Great tips and tricks!

4 COSTS TO CONSIDER AS A FIRST-TIME HOMEBUYER

Oftentimes even the most organized and detail oriented first-time homebuyer can overlook some unexpected costs that come with the purchase of their new home. We are outlining 4 of the costs that we most commonly see overlooked by home buyers in hopes that we can better prepare you—and save you from a few surprises!

1. Closing Costs.

Congratulations! Your offer was just accepted on your new home, you’re one step closer to adding a major asset to your portfolio! We don’t want to shock or dampen the excitement of this moment. However, it’s important that you factor in closing costs right at the beginning of your purchase.

The best time to do this is before even applying for your pre-approval or making any offers on a home. Closing costs may include:
>insurance
>taxes (Land Transfer, Property, and others depending on what province you are in)
>legal/notary fees
>inspection/appraisal fees.

A general rule of thumb is to set aside 1.5% of the purchase price to account for the closing costs above. To plan ahead, consider speaking to a mortgage broker and your realtor. They can help you determine just how much you should set aside to accommodate those additional closing costs.

2. Utility Bills.
If you’ve gotten used to living in a small space, such as a condo or an apartment, you may be surprised how much more water, heat, and energy you consume in a larger space such as a detached home or a townhouse.

It’s important to prepare for these as you do not want to have a “surprise” when your bill arrives in the mail and it’s nearly double what you are used to spending!

Factoring in these bills is also crucial if you are going from renting to owning! Often times the landlord will cover a portion of your utility bills or your cable/internet depending on the contract you had with your landlord. Of course, once you are a homeowner, you are covering the entire cost! Ask family members, friends, even your mortgage broker or realtor what is a realistic cost for things such as cable and internet, water, heat, etc. You’d be surprised how fast they can add up!

3. Renovations and Updates.

Unless you bought a newly built, brand new home, there is undoubtedly going to be future renovations and updates that you will need to do on your home. They may not need to happen right when you move in, but sometimes the unexpected does happen and having money set aside can make a world of difference! When you have your home inspection completed, make a prioritized list of what will need to be fixed/updated first and set aside money each month for it.

In addition to the “must do” updates/renovations, new property owners may also want to make aesthetic improvements, whether they mean to reside there or not. Naturally, a homeowner wants to make the place feel more like their own, and investors want to add value their investment or make adjustments to make the asset more aesthetically pleasing.

4. Ongoing Maintenance
Home’s require maintenance—all the time! Ask any homeowner and they will tell you that there is always home maintenance in one form or another happening. A few common home maintenance costs may include:
• Gutter cleaning
• Roof repair/maintenance
• Drywall repair
• Furnace cleaning
• HVAC and Duct cleaning
• General plumbing and electrical fixes
Every home is different in regards to how much you should budget annually for regular maintenance. It will depend on the age of your home, square footage, climate in your region, and overall condition of your home.

In closing, property ownership shouldn’t be dampened by financial rules caused by lack of preparation. All of these costs, as well as additional other costs, are easy to plan ahead for and to ensure that you have budget set aside each and every single month to make sure that you stay on track. As a rule of thumb, the CMHC states that your housing costs including mortgage payment should not exceed 39% of your monthly income. Treat this number as a point of reference when you’re doing your budget and consider leaving room for the unexpected. It’ll give you peace of mind on the long run and allow you to actually enjoy your new home!

GEOFF LEE
Dominion Lending Centres – Accredited Mortgage Professional

 

15 Aug

Credit Reports: You’ve Scored! But Are You Playing the Game?

General

Posted by: Jeannie Stace-Smith

Credit Reports: You’ve Scored! But Are You Playing the Game?

For most people, your personal credit score and how a credit score is calculated are complete mysteries. How can you be expected to play and be successful if you aren’t even told the rules of the game? There are things borrowers can do to improve their score so they can access better mortgage products and save thousands of dollars, or qualify for their wonderful home when they otherwise might have trouble. Let’s stick handle through just some of the key things you should know about managing your credit score.

Amount owed and utilization accounts for 30% of your score. There are a lot of people that end up with high balances on their credits cards and struggle to meet the payments each month. If they manage to pay off their credit cards without seeing a mortgage broker to consolidate their debts, often the immediate response is to close the accounts. A better response is to cut up the cards and delete the numbers from your computer and devices and keep the accounts open. You want any remaining outstanding balances to be less than 75% of your total combined credit available, and if they are less than 35%, even better, because this keeps your utilization of available credit low and increases your credit score. Types of credit and the number of different credit products accounts for 10% of the score, so this is another reason you want to keep those accounts open. Cell phone providers are now reporting to the agencies that publish credit scores as well.

In some parts of the world where credit products are not well established, a borrower’s credit is evaluated based solely on how they have managed payments on their cell phone bills. It’s important to pay your cell phone bills on time; we’re all busy, so setup automatic payments to ensure a payment is not missed. My last word of advice for today is to monitor your credit score by purchasing your own credit report each year for about $25 so you know your score and to ensure the report is accurate. This will help you stay within the boundaries of the game.

There is a lot more to managing a credit score than I can get into in this short blog. If you would like to know more, contact me or your local Dominion Lending mortgage broker. We can provide advice to help you manage your credit score and put you in a better position to qualify for a mortgage with better rates. Know the rules of the game, plan ahead for your home financing, and play SMART.

Todd Skene
Dominion Lending Centres – Mortgage Professional