Tuesday, August 29, 2017

Spousal Buyout Mortgage

Spousal Buyout Mortgage?

Spousal Buyout Mortgage?
If you happen to be going through, or considering a divorce or separation, you might not be aware that there are mortgage products designed to allow you to refinance your property in order to buyout your ex-spouse.
For most couples, their property is their largest asset and where the majority of their equity has been saved. In the case of a separation, it is possible to structure a new mortgage that allows you to purchase the property from your ex-spouse for up to 95% of the property’s value. Alternatively, if your ex-spouse wants to keep the property, they can buy you out using the same program.
Here are some common questions about the spousal buyout program:
  • Is a finalized separation agreement required?
Yes. In order to qualify, you will be required to provide the lender with a copy of the signed separation agreement. The details of asset allocation must be clearly outlined.
  • Can the net proceeds be used for home renovations or to pay out loans? 
No. The net proceeds can only be used to buy out the other owner’s share of equity and/or to pay off joint debt as explicitly agreed upon in the finalized separation agreement.
  • What is the maximum amount that can be withdrawn?
The maximum equity that can be withdrawn is the amount agreed upon in the separation agreement to buy out the other owner’s share of property and/or to retire joint debts (if any), not to exceed 95% loan to value (LTV).
  • What is the maximum permitted LTV?
Max. LTV is the lesser of 95% or Remaining Mortgage + Equity required to buy out other owner and/or pay off joint debt (which, in some cases, can total < 95% LTV). The property must be the primary owner occupied residence.
  • Do all parties have to be on title?
Yes. All parties to the transaction have to be current registered owners on title. Solicitor is required to do a search of title to confirm.
  • Do the parties have to be a married or common law couple?
No. The current owners can be friends or siblings. This is considered on exception with insurer approval. In this case, as there won’t be a separation agreement, there is a standard clause that can be included in the purchase contract that outlines the buyout.
  • Is a full appraisal required?
Yes. When considering this type of a mortgage, it is similar to a private sale and a physical appraisal of the property is necessary.
If you have any questions about how a spousal buyout mortgage works, contact Amy Wilson for all your mortgage needs.   Be assured that our communication will be held in the strictest of confidence.

Thank-you  Michael from DLC for this article


Monday, August 21, 2017

Transferring your mortgage to another lender

Transferring to Another Lender

Just because you’ve received a renewal offer from your current lender, doesn’t mean you can’t get a better deal elsewhere.
As your mortgage specialist I can evaluate your mortgage needs and determine whether your current mortgage is still the best fit. We’ll also shop your renewal to many of Canada’s leading lenders to help find the deal you want.

Monday, July 31, 2017

 

 

Residential Mortgage Commentary - week of July 31, 2017

Jul 31, 2017
Be the expert
First National Financial LP


The Bank of Canada appears to have adopted the stance that any excuse to raise interest rates is a good excuse.  If that is true then the latest economic data puts us on track for another hike later this year.
The latest GDP numbers came in above forecast, bolstering the bank’s rosy contention that the economy is back on track.  Economic growth beat forecasts by 40 basis-points in May.  Real GDP growth clocked-in at 0.6%, compared to the 0.2% expectation.  All things considered Canada is on track for 3% growth this year.
Apart from household debt-loads and stalled wage growth, most of Canada’s economic concerns remain international.  Given the protectionist rhetoric and half-bake policy notions being tweeted out of the White House, and given that the full folly of Brexit has yet to reveal itself, the BoC can hardly be blamed for trying to give itself room for some future stimulus should the economic picture turn ugly.
The next rate setting is in September, but it is unlikely the central bank will move before October when it will update its economic forecast and its monetary policy report.

Thank-you First National Bank
Amy Wilson
yourmortgagegirl

Thursday, June 29, 2017

Stuck in your 10 year mortgage?

Stuck In a High Rate 10 Year Fixed Mortgage?

Stuck In a High Rate 10 Year Fixed Mortgage?With low rate offerings over the past several years and a struggling economy, some homeowners chose to lock into a longer term mortgage even if the interest rate was a bit higher. If you are one of those people who feel stuck in a high rate 10 year fixed mortgage you may be wondering if you have options. The answer is YES.

Let’s consider the case of Dan and Anita who own a home and refinanced their mortgage 8 years ago into a 10 year term. They wanted to consolidate their high interest credit cards and their mortgage into one lower monthly payment and be secure with that monthly payment for as long as possible.
The news was painting a picture of doom and they wanted to take advantage of the “record low” rate of 5.25% for 10 years. Over the past few years they have watched the shorter term rates for 5 year term mortgages continue to drop to under 3% and they feel they may have made a poor decision. But since they feel they are stuck in a high rate 10 year fixed mortgage with the potential of a high penalty to get out of the mortgage they have chosen to stick it out. The monthly payments are $1,644 which they can afford but the potential of payments at under 3% for the remaining 5 years would be $1,304 (based on the remaining amortization) which is hard to pass on.

A friend told them to talk to her mortgage broker to see what real options they had. After talking to the broker they learned the penalty for terminating a 10 year mortgage after 5 years is only 3 months interest or $1,200 in their case (and legal fee of about $600). Dan and Anita were stunned they had missed this in the fine print of their mortgage agreement. And to top if off this policy is determined by law and not by the lender. This was great news for the happy couple. The broker also ran numbers to show them how they could further take advantage of the lower interest rate and increase their monthly payments to pay off their mortgage faster.
By increasing the payment by 20% – which was still lower than what they were paying before and paying bi-weekly instead of monthly, they lowered their interest costs by $20,000 over the next 5 years and reduced their amortization from 25 years to 12 years!
The morale of this story is, if you are stuck in a high rate 10 year fixed mortgage and you are close to the 5 year mark, you should talk with me - yourmortgagegirl! and see what options you have to save yourself some money on your mortgage. What would you do with a savings of over $20,000?

Thank-you Pauline Tonkin for you article.

Monday, April 24, 2017

LET'S GET FLEXIBLE

 FLEX DOWN MORTGAGES:


Do you have great credit, full time employment, but no down payment for a home saved?

 I can help arrange a loan or a line of credit, or we can use an existing one you have in place as your down payment.

 With all mortgages, you need to have at least a 5% down payment saved up. Don’t have it? Don’t worry.

This is a great way to take advantage of today's low interest rates without having to wait while you save up the down payment. The minimal amount of interest you would pay on the loan, compared to the potential higher difference in future interest rates and housing prices, puts you further ahead when you buy now.

Contact Amy Wilson, yourmortgagegirl today to find out how we can help you get into your dream home.



Monday, April 3, 2017

Monoline Lenders v.s. Banks and Credit Unions

Banks & Credit Unions vs Monoline Lenders

Banks & Credit Unions vs Monoline Lenders We are all familiar with the banks and local credit unions, but what are monoline lenders and why are they in the market?
Mono, meaning alone, single or one, these lenders simply provide a single yet refined service: to fulfill mortgage financing as requested. Banks and credit unions, on the other hand, offer an array of other products and services as well as mortgages.
The monoline lenders do not cross-sell you on chequing/savings account, RRSPs, RESPs, GICs or anything else. They don’t even have these products and services available.
Monolines are very reputable, and many have been around for decades. In fact, Canada’s second-largest mortgage lender through the broker channel is a monoline lender. Many of the monoline lenders source their funds from the big banks in Canada, as these banks are looking to diversify their portfolios and they ultimately seek to make money for their shareholders through alternative channels.
Monolines are sometimes referred to as security-backed investment lenders. All monolines secure their mortgages with back-end mortgage insurance provided by one of the three insurers in Canada.
Monoline lenders can only be accessed by mortgage brokers at the time of origination, refinance or renewal. Upon servicing the mortgage, you cannot by find them next to the gas station or at the local strip mall near your favorite coffee shop. Again, the mortgage can only be secured through a licensed mortgage broker, but once the loan completes you simply picking up your smartphone to call or send them an email with any servicing questions. There are no locations to walk into. This saves on overhead which in turn saves you money.
The major difference between a bank and monoline is the exit penalty structure for fixed mortgages. With a monoline lender the exit penalty is far lower. That is because the banks and monoline lenders calculate the Interest Rate Differential (IRD) penalty differently. The banks utilize a calculation called the posted-rate IRD and the monolines use an IRD calculation called unpublished rate.
In Canada, 60% (or 6 out of every 10) households break their existing 5-year fixed term at the 38 months. This leaves an average 22 months’ penalty against the outstanding balance. With the average mortgage in BC being $300,000, the penalty would amount to approximately $14,000 from a bank. The very same mortgage with a monoline lender would be $2,600. So, in this case the monoline exit penalty is $11,400 less.
Once clients hear about this difference, many are happy to get a mortgage from a company they have never heard of. But some clients want to stick with their existing bank or credit union to exercise their established relationship or to start fostering a new one. Some borrowers just elect to go with a different lender for diversification purposes. (This brings up a whole other topic of collateral charge mortgages, one that I will venture into with another blog post.)
There is a time and a place for banks, credit unions and monoline lenders. I am a prime example. I have recently switched from a large national monoline to a bank, simply for access to a different mortgage product for long-term planning purposes.
An independent mortgage broker can educate you about the many options offered by banks and credit unions vs monolines.

Thank-you Michael Hallett from DLC for you article.

Thursday, March 23, 2017

Step By Step Mortgage Guide



 
One of the first steps in buying a new home is to take a realistic look at what you can afford and how you are going to pay for it. 

If you are like most people, you will probably have to finance your home purchase with a mortgage. 

Please click here to find the Step-By-Step Mortgage Guide with explanation of terms and options to understand when considering what mortgage is right for you.

Wednesday, February 15, 2017

What you Need to Know About No Frills Mortgages


What you Need to Know About No Frills MortgagesYou’ve been offered an amazing rate and you just can’t believe how much you will save. You’re super excited and getting ready to go sign off on the papers when you randomly run into a mortgage broker and mention the deal you scored. The broker says to you that’s an awesome rate, any idea what the penalty calculation is if you need to refinance in the future?. Wait what…isn’t it the same as the last mortgage I had?
Maybe but maybe not. There are a lot of new mortgage products available on the market that offer lower rates while giving up other benefits. These mortgage options may have higher penalties, lower prepayment privileges or even worse they could have a bone fide sale clause.
I don’t blame a consumer for always thinking rate first. The industry as a whole is guilty of shoving rates in our face anytime they possibly can. It’s the easiest part of a mortgage to compare and easiest to advertise. But definitely not the most important part.
Being aware of all the terms and conditions is the key to finding your best mortgage option. You should be aware that there are mortgages that may come with one or more of the following terms:
* Sales only clause, meaning you may not be able to refinance your mortgage until your term is up
* A higher set pay out penalty. Meaning you may have to pay more than the standard 3 months interest or Interest Rate Differential penalty.
* Smaller prepayment options
* and more!
Always ask these 5 Questions when offered a mortgage:
1. How is the pay out penalty calculated if I break the mortgage?
2. Can I refinance with another lender before my term is up?
3. Is the mortgage registered as a Standard or Collateral charge on my land title?
4. What are my prepayment privileges?
5. Is the mortgage portable and assumable?
Bottom line is that knowing all the fine print is essential in making an educated mortgage decision. We never know what is going to happen in life and saving a little bit on your mortgage rate may cost you more in the long run.

Thank-you Kathleen Dediluke for the above article.

Monday, January 30, 2017

Understanding the upcoming increase to Mortgage Insurance Premiums

Are you putting less than 20% down to purchase your home?  If your answer is yes, please contact Amy Wilson today as the mortgage insurance premiums are set to increase on March 17th/2017.

How this will effect you: see an example chart below:

Down payment between 5% and 9.99%
Loan Amount$150,000$250,000$350,000$450,000$550,000$850,000
Increase to Monthly Mortgage Payment$2.82$4.70$6.59$8.47$10.35$15.98
Based on a 5 year term @ 2.94% and a 25 year amortization 

Down payment between 10% and 14.99%
Loan Amount$150,000$250,000$350,000$450,000$550,000$850,000
Increase to Monthly Mortgage Payment$4.94$8.23$11.52$14.81$18.10$27.98
Based on a 5 year term @ 2.94% and a 25 year amortization

Down payment between 15% and 19.99%
Loan Amount$150,000$250,000$350,000$450,000$550,000$850,000
Increase to Monthly Mortgage Payment$7.06$11.75$16.46$21.16$25.86$39.96
Based on a 5 year term @ 2.94% and a 25 year amortization

Contact Amy Wilson with any questions you may have and feel free to click here for more information from CMHC!

Sunday, January 29, 2017

Your Mortgage Plan! I promise it is easier than you think.........

YOUR MORTGAGE PLAN

 
What does your mortgage plan mean?   I have customers come to me on a referral basis daily and the only thing in common with all my clients is that their mortgage needs and what they need to do to qualify is unlike anyone else!!!!  This is where I come in - as your mortgage girl, I look at each individuals unique situation and figure out a mortgage plan for them based on their credit, job history, down payment and what their lifestyle needs are.  What I want to stress to anyone who is reading this article and all the people who are referred to me - this is a safe zone for you, no judgment - I am here to help no matter what. 
Today I am going to focus on something that many people are not aware is available to them, absolutely free of charge and it can change your buying future for the better.

START RIGHT PROGRAM!

 My start right program is working for many clients and has proven to be very successful for my clients and my referral partners.

I have a follow up system in place, based on what is required to get a client, you, in a mortgage.  For some reason you don't qualify to buy right now and usually get discouraged and give up when you are told you are declined by the lenders. 
 
I look at  your decline from a lender as an opportunity - the first step is taken - you know you want to own a home - so what needs to happen to get you there.  I set up a plan, free of charge for you so you can reach your home ownership goals. 

The program is set from 4 months to 2 years to get you qualified! Instead of staying in the same dreaded cycle of not qualifying because you don't fully understand why you didn't in the first place or didn't know how to fix it.

All the correspondence I send to you to get back on track is also co-branded with your original referring partners(realtor, home sales consultant, friend) information on it and when you are ready to buy, you are referred back to them to buy your home!

Contact Amy Wilson today!  I promise it is easier than you think and well worth it!

You dont' even need to leave the comfort of your own home as all my services are done over phone, email and or fax!

Click here to do an ONLINE APPLICATION NOW!



Wednesday, January 18, 2017

Contribution Deadline - March 1/2017- RRSP as a Down Payment



Are you a first time home buyer and looking to use your RRSP's as a down payment here's a few things you need to know.
  1. To use this program you must have not owned a home in the last 4 years but did you know that if your spouse owned a home previously and you didn't live in the house then you may still qualify.
  2. RRSP contributions need to be in the RRSP account for at least 90 days before they can be used. If you are a monthly contributor to the account then only the amounts there for more than 90 days can be used for down payment.
  3. You can borrow money to put into an RRSP and have it be there 90 days to use for down payment. Using this method of acquiring the RRSP means that you must be sure of two things, one being that the lender is okay with you taking it out in 90 days. Secondly that it isn't put into an account that will not have fees to take the money out, money market funds or simple 90 day term certificates shouldn't cost you any penalty.
  4. You can withdraw up to $25 000 dollars from your RRSP to put down on a home. Locked in LIRA's are not eligible for this program so make sure before you start down this path that you know what type of account you have your money located in at the bank.
  5. You have to pay the amount you borrowed back to the RRSP account over the next 15 years. If you took 15000 dollars out you would need to repay $1000 dollars a year to the account. Failing to pay this money back may result in CRA taxing it as income.
  6. You can contribute to your 2016 RRSP up until March 1st and receive a tax deduction for the contribution, this also applies if you borrowed the money to contribute. Theoretically you can also take the tax refund and apply it back to the loan or use it for your new home.
Contact DLC Brokers for Life - Amy Wilson and we can direct you to our partners companies so that you can take advantage of this opportunity to enter the home owners market...We've got a mortgage for that..