Wednesday, January 16, 2019

New year, new ways to manage that holiday debt!

New year, new ways to manage that holiday debt!


I hope your holidays were spent warm, safe and in the company of family and loved ones. I also hope that you’re not drowning from all the holiday purchases such as the dinners, the appetizers, the gifts, the gift cards, the drinks, the party favors – shall I continue?
It is expected that most people will spend over their budget during the holiday season. In fact, Canadian consumers spent 3.7% higher than they did last year. According to PwC, Canadians spent, on average, $1,563 each on consumer products this holiday season.
Are you among that group who spent 3.7% higher than last year? Not too worry, I get your generosity and as always, I am here to help you during this NORMAL time period of financial anxiety and discomfort.
Once again, we’re all in this together. You are not alone in your debt situation no matter how high or how low.
My first suggestion is to put those credit cards on ice and leave them for a while. Cut out the temptations completely and focus only on the necessary transactions including home utilities, car insurance, mortgage, etc.
This extra money can be put aside and stored in your savings for multiple reasons. It is important that you DO NOT SPEND this lump sum of cash on clothes, electronics, or big-ticket items. Just because this money is readily available to you – doesn’t mean it should be spent on materialistic items.
Don’t know what to do with that extra cash and want to make good use of it? Direct this money towards credit card debt (this one is important!!) or perhaps a “nest egg” before a move across the country, retirement, whatever suits you best.
I highly suggest not letting that holiday debt get the best of you by addressing it first and foremost. Do not let this debt slide under the radar and come back mid-year with more debt racked on top of it. Trust us! Addressing your Christmas dues now will make the rest of your financial year reasonably better without having those regrettable thoughts about giving your gifts to your families.
Since it is the beginning of January and new year resolutions are [hopefully] still fresh in people’s minds, make it your 2019 goal to create a monthly spending plan. Setting up a budget will put an end to bad spending habits and increased debt if you take your budget seriously as well as make realistic changes that are suitable to your current lifestyle.
Having a financial plan will force you to look at the numbers and assess your spending. You may be very surprised by the amount of money you are currently using towards just a simple cup of coffee on the way to work.
If you have questions as to how to get started, here is a link to the 10 Basic Steps provided by Smart About Money that takes you through your motivations about your money, how you would like to utilize your money and how to put your budget into action.
Lastly, and this tip is easy, if you already have one or two credit cards that are racking up debt – do NOT apply for a new credit card. We assure you handling one monster at a time is better than taking on multiple beasts.
If you have any questions or concerns as to how you should be spending your money on your mortgage, contact Amy Wilson, 780-919-0475 or amy@yourmortgagegirl.ca.

Thank-you  Chris Cabel with accredit mortgage Professional

Friday, January 11, 2019

Mortgage Questions Answered: I am a first time home buyer, How do I get a mortgage?




Getting a mortgage for the first time can be a daunting task.  I have taken the complication out of the mortgage process and will take you through it one step at a time.  

I have outlined the mortgage process below:

Step One:



The link below is for my website, just click on the apply now button and follow the prompts – this application will come direct to me as soon as you have completed it.


AMY'S WEBSITE



Step Two:



Upon receipt of the above online application - I will send you a consent form via docu-sign – it takes less than a minute to sign and no app download is needed.



Upon receipt of the signed consent and the application, I will contact you to fill in anything that may be missed and issue you a list of required paperwork for the lender.  

Below you will see a generic list to get started with and we can update it once we have the application and consent completed.



  1. letter of employment – company letterhead, job title, start date, base income paid, name and contact number to verify the letter
  2. Most recent paystub
  3. If you earn bonus, overtime or commissions please also provide last two years Notice of assessments and T-1 generals
  4. two pieces of ID - one must be a picture ID
  5. 90 day banking history with name and account number on it to verify your down payment
  6. Void cheque




Contact me to get started today!
amy@yourmortgagegirl.ca

Wednesday, January 9, 2019

Mortgage Questions: Answered ..... How do I get my credit stronger to qualify for a mortgage?

9½ Steps to Repair and Improve Your Credit


Though credit scores aren’t always an indicator of financial health, they are used in a variety of ways that could have a major impact on your life. Interest rates (including mortgage rates) are almost always determined by your credit score. Some employers & landlords may require a credit check to see if you have past credit issues.
Remember this is your credit report, not your “I’m Fiscally Responsible” report. Lenders want to know how you have historically handled credit in order to determine if you are a good credit risk. Higher risk = higher rates!
The Rule of Two:
• You should always have 2 “tradelines” going. This can be a combination of 2 credit cards OR a credit card and a line of credit/ loan etc.
• Credit lines should have a minimum $2,000 limit
• Minimum of 2 years old
So, if your credit score sucks, it could be costing you.
The good news is, you don’t have to live with bad credit forever. There are plenty of things you can do to improve your credit score. Use the 9½ tips below, to improve your credit score
#1) Know Your Credit Score and Credit History
Request a free copy of your credit report from both of Canada’s credit agencies (TransUnion and Equifax). You are legally entitled to one free credit report yearly from each credit agency. 
Trans Union: Request your Consumer Disclosure by phone : 1(800) 663-9980 
Equifax : free Equifax credit report by phone, call 1-800-465-7166
#2) Review both TransUnion & Equifax Reports for Any Errors or Discrepancies.
If you find any errors in your credit report, you should dispute them with Equifax or TransUnion and request to have them correct any errors.
#3) Pay On Time, EVERY time!
This might seem obvious, but you need to make your payments on time, every time! This is crucial to repairing and maintaining your credit rating. The largest percentage of your credit score is based on your payment history!! Even being a couple of days late will have a negative impact on your score. Staying current with your payments has a huge positive impact. If you can’t pay the balance off in full, pay the minimum amount on time!
#4) Don’t Go Over Your Card’s Credit Limit
Going over your credit limit, even once will have a huge negative impact on your credit score. You need to be aware of your credit limit and your current debt levels to avoid this.
#5) Pay Off Any Overdue Accounts ASAP
Paying off a collection account will not remove it from your credit report, so do your best to avoid going to collections. If you have any overdue accounts that have gone to collections, negotiate to pay them off ASAP.
#6) Reduce Your Debt
Easier said than done, but if you want to increase your credit rating, you need to reduce your debt. The closer you are to your credit limit, the lower your score. In a perfect world you only want to use about 30% of your available credit. If you have a lot of credit card debt you might consider a loan (with lower interest rates than the credit cards) to consolidate your debts.
#7) Limit Your Inquiries for New Credit
You lose points from excessive hard inquiries on your credit bureau. Any attempts to take on multiple loans/credit cards will look bad in your report.
#8) Avoid Closing Credit Cards
Account age is a factor that reflects positively on your credit score. Too many new accounts lowers your average account age and negatively impacts your credit score. For the same reason, you may want to keep an old account open, even if you are not actively using it.
#9) Time is your Friend
When rebuilding your credit, time will be your best friend. The impact of past credit problems lessens with time, so that a late payment from a year ago will have much less weight than a late payment today. Get current and stay current.
#9.5) Protect Your Credit from Identity Theft
As more of our personal information gets circulated via the internet, there’s more room for “bad people” to steal your personal details so that they can make fraudulent purchases in your name. This can be extremely damaging to your credit history. You can protect your credit history from this by paying for a service that can alert you to fraud.
Thank-you Kelly Hudson with DLC Canadian Mortgage Experts for this valuable information!



Tuesday, January 8, 2019

Mortgage Questions: Answered



The idea behind this blog post and more to come over the coming days and weeks is to take actual questions and conversations from my clients and post them here to help people better navigate getting their next mortgage.

Lets get started:

Question:  Amy, I am looking to buy a home and need to know what your best rate is as I was offered 3.49% as the best mortgage rate.

Answer: 

Thank-you for contacting me and giving me the opportunity to earn your business.  Rates can very based on the length of rate hold and the type of mortgage you require, so I will need approx. 10 minutes of your time to go over what type of mortgage will suit your needs and how long we need to hold the rate.  It is impossible to just quote the best rate without asking questions to narrow down rate options.  here are a few examples:

1. Will you be buying a home and taking possession of the home within 120 days or less?
2. Is the home a build?
3. If it is a build - do you need a completion mortgage or a draw mortgage?
4. If it is a build - what is the estimated completion date?
5. do you have strong credit?
6. do you have your own down payment?
7. do you want a variable or fixed mortgage?
8. how long do you intend on staying in this home?

In the scenario I had today, the client was quoted a rate of 3.49% without any questions being asked.
When I was done working with the client, my best rate was 4.04% - Why?

The client was looking to build a home with the very reputable Park Royal Homes in Edmonton.  The builder was willing to set up a draw mortgage and take first draw in 6 months.  The clients had a 20% down payment to avoid CMHC fees and chose a 5 year fixed rate because this was the clients long term home and they didn't like the risk of a variable mortgage.

This meant the client needed a min. 6 month rate hold where the rate gets locked in at first draw on an insurable mortgage product.  ATB was offering a 6 month draw rate hold at 4.04% five year fixed rate.  

The rate they were quoted prior to speaking with me was based on a 90 day quick close possession, 5 year fixed rate with less than 20% down.  This rate was not worth the paper it was put on because it didn't apply to the customers needs.

Mortgages are not simple - you are borrowing a lot of money from the bank to make the biggest purchase of your life.  Be prepared to answer questions to get the right answers and take you time to ask questions to ensure you are working with a mortgage professional who has your best interests in mind and understands your mortgage needs.  

Quote of the Day

" What is your best mortgage rate? ………………….Depends:)"





Wednesday, November 14, 2018

Growing cannabis at home? Let’s weed through those mortgage issues!



As many of you already know, Canada just became the second country in the world to legalize marijuana for medical and recreational purposes. Of course, this historic moment in Canadian history has cannabis activists jumping for joy while others are not s-toked on the idea.
With legalization comes the realities of growing your own pot at home which already has Global News giving Canadians a step-by-step guide on how to do so properly and legally — sorry Manitoba and Quebec!
We always have clients contacting us for restructuring advice on their current mortgages. However, through our initial discussions, we have found out that some have started growing pot plants within their homes. Since this legislation is new to everyone, including the mortgage community, we had to do some research.
Prior to September 17, growing cannabis at home was a legal grey area. Mortgage wise, it was a red flag. Any home that has previously or is currently being used in the growing of cannabis was treated as a “grow-op” and as a result is NOT financeable.
grow-op: a concealed facility used for marijuana plantation.
Since legalization day on October 17, the federal government officially set a limit of four pot plants per household — NOT by person. This information DOES NOT have to be disclosed on a property disclosure UNLESS damage has occurred within the household because of cannabis cultivation.
Just as a FYI — ALL property owners should consult their realtor or lawyer about how to properly disclose when selling their household.
After talking to our local Canada Mortgage and Housing Corporation representative (CMHC), she notified us that mortgage insurers are currently leaving lenders to create their own policies on how to deal with marijuana plants and their effect on existing mortgages. We contacted lenders about this ‘budding’ home-grown industry but were met with no answers.
This situation is certainly a waiting game and we’re all holding our breath waiting for the first move!
Let us share our advice.
If you are looking to sell your property or refinance your mortgage — get rid of those pot plants now!
Any home appraisal company can disclose in their report that cannabis is present within your home which could place your home on a list that DOES NOT foresee future sales or refinances.
It is your safest bet to keep your cannabis plant growth up to the licensed growers located across the country.
If you have any questions, contact your local Dominion Lending Centres mortgage professional.

Thanks, Chris Cabel for this article
Chris Cabel

Chris Cabel

Dominion Lending Centres - Accredited Mortgage Professional
Chris is part of DLC HomeHow Mortgage based in Calgary, AB.

Tuesday, November 6, 2018

No need to panic after rate increase

No need to panic after rate increase




You may have already seen the more technical BANK OF CANADA RATE ANNOUNCEMENT on October 24th, or you may not have. The Coles Notes (the simplest version) are as such:
  • Global economy remains strong, the USMCA will reduce trading uncertainty
  • Canadian economy is balanced for the foreseeable 2 years
  • Household spending will increase, but backed by income growth
  • Housing activity across Canada is stabilizing

On October 24th the Bank of Canada did what we all expected, they increased the Overnight lending rate by 0.25% to 1.75%. This equated to a PRIME being increased by 0.25% to 3.95%. All variable rate mortgages and lines of credit utilize PRIME to calculate the current interest rate.
Now the BIG QUESTION, how do we as mortgage consumers respond? 
No need to ask me, I will tell you. Variable, with no hesitation. I will stay the course by not pushing the panic button.
WHY?
Because if I decide to move, re-finance, consolidate, leverage equity or to simply break the mortgage for any reason my penalty will only be 3 months interest. I also need to consider how much money I have saved over the term by utilizing a variable rate mortgage rather than a fixed. During my current mortgage the spread between variable and fixed is approximately 1%.
Real estate wealth is a long game, building net worth doesn’t happen overnight. Gains are not made in the short term. Just like other markets (stocks, bonds, mutuals, GICs RRSPs), there will be highs and lows.
What does this increase mean?
Dollarize it for your own personal consumption. For an increase of 0.25% the payment will go up $13 per every $100,000 borrowed. For some variable rate borrowers, the payment hasn’t even changed as the lender only adjusts the principal and interest allocation.
Now the question becomes, what do you do? Remain with variable or lock into a fixed. I recommend staying the course.

Thank-you Michael Hallett DLC Producers West Financial for this article

Thursday, October 25, 2018

Mortgage Rates on the Rise

Rates On The Rise Both Variable & Fixed


With the Bank of Canada in a mood to raise rates, it’s a similar feeling for the bond market, which impacts fixed rates. In every interest-rate market there are many factors leading to an increase and we are hoping to provide a little bit of clarity on what is happening and what it means to you and your loved ones. We tell you this in advance to be proactive to take care of you, as our mortgage family, so as you hear the news about the changes you have comfort we are here to lead with clarity.
At this time, we see fixed rates increasing as the bond market increases.
Why do we note this information and how does it relate to you?
If you are in a variable rate, you will want to:
  1. Review your lock-in options by contacting us or your lender directly (every lender has different policies in allowing us to help or not). Knowing it’s unlikely the prime rate will reduce and fixed rates are on the rise, there could be a sweet spot to review your options now.
  2. If you decide not to lock in, it’s time to review your discount to see if a higher one can be obtained elsewhere.
Locking in won’t be for everyone, especially if you are making higher payments and your mortgage is below $300,000, which most people fit and will continue on that path. Also if your discount is more than .6 below prime you may want to wait and watch the market. Locking in will be around a 1% higher rate than you are likely presently paying. If knowing you can likely lock in around 4% now is most attractive to you, this may be your time.
If you are in a fixed rate:
  1. If you obtained your mortgage in the last year, stay put.
  2.  If you are looking to move up the property ladder or consolidate debt, get your application in to us ASAP so we can hold options for up to 120 days.
  3. If you are up for renewal this year or know someone who is, secure your options now with us to weight out the savings prior to renewal with us keeping a watchful eye on the market.
Keep in mind that if you or someone you care about has an average mortgage of $350,000 and got it a few years ago at 2.49% now a qualified applicant can expect about 3.89% which is a payment increase of $254 dollars a month, so increasing your payment now will protect your equity, and you from future payment shock.


Thanks Angela Calla for this article