homes london ontario

Why Use a Real Estate Broker?

by
Why You should Use a Real Estate Broker

Plan on buying a home soon? Did you know that there are plenty of ways that a real estate broker can help you achieve your goal by finding the best home that meets your needs, all while ensuring your peace of mind?

Below you find some of the main tasks a real estate broker performs for their clients that will be a buying a home:

 

Evaluate Your Needs

This will include the type of property you are looking for, what type of area or neighbourhood you want to live in, if you want a new home or one that might require some renovations be made to it, how many bathrooms and bedrooms you might want to have. Your real estate broker will help you identify which essential elements should be included in your future home.

 

With their in-depth knowledge of the market, your broker will help to ensure that your budget corresponds to the type of property you’re looking for and the neighbourhood you’re interested in. Your broker will also encourage you to get a pre-approved loan from your bank, this helps to speed up the buying process and makes you credible with sellers.

 

Give You Choices

Your broker will present you with properties that match what you are looking for. They help organize visits to these potential properties, as well as give you an honest opinion about each property. They can also provide you with various options that have not been considered. When you finally find a real winner, your broker will advise you on the strategy for submitting the promise to purchase.

 

Ask Questions For You

The broker will also attend the inspection of the home, ask questions and help you understand the inspection report on the property. Your broker will also follow-up on the fulfilment of conditions and act as an intermediary for the delivery of various documents, these can include bank drafts, etc.

 

Remember that if you do have any questions, your broker will answer them during the buying process. If you’re buying a condo, for example, they will analyze the essential documents with you, such as the minutes of condo meetings, the condo’s financial statements, etc.

When all the conditions have been met, your broker will accompany you to the notary for the signing of the documents that formalize the transaction.

As you can see from the above that your broker is involved at almost every step of the home buying process, why would you miss out on their guidance and expertise?

Bridge Financing, What Is It?

by
Bridge Financing London, Ontario Mortgages

What is Bridge Financing?

It is a useful tool made available to borrowers when the closing date of the home they are purchasing is before the closing date of the home they are selling. This is generally common in a seller’s market, buyers often explore the idea of making a firm offer without conditions, even if they have their own house to sell.

Bridge Financing means that the lender is comfortable making an interim loan between the closing date of the new purchase and the closing date of the buyer’s own firm sale. Basically, it is closing the gap between the two firm closing dates that do not coincide.

Bridge financing is not the same as being able to carry two separate properties.

However, bridge financing is not applicable if your home is not sold firm, you are talking about carrying two properties (owning two homes). Carrying is when the buyer owns two homes simultaneously for any length of time. They are also qualified to carry the total sum of the two mortgages.

So, what is required to set up bridge financing? Your lender will ask you for a copy of your firm purchase agreement and firm sale agreement.

This is a great stress reliever and helps with leaving a buffer of time for the buyers to get settled into their new home before their own purchasers will show up on their previous home’s doorstep looking for a clean and empty property. This also give the buyer some flexibility when it comes to accepting an offer on their own home, that firms

Bridge financing is quite common and a wonderful option but its a conditional on your own home have a firm offer in place.

When it comes down to it, you should make it clear with your lender whether you are looking to mortgage two homes or bridge the gap between 2 firm sales before you firm up your financing.

Why The Best Mortgage Rate May Not Always Be The Lowest

by
Mortgage Rates London Ontario

Just like when looking for a car, it isn’t always the best option to choose the cheapest one you find, it is the one that is best suited for you and your lifestyle. So just like when looking at mortgages, choosing the one with the lowest interest rates might not be the best option for you, as it could end up costing you more.

How can it cost me more?

One of the reasons why some of the interest rates are low, is that they come with restrictions and sometimes aren’t that flexible. While lenders can entice you with low fixed rates, they might be able to get that money back further down the road with penalties and fines if you were to adjust or change your mortgage. This is not an uncommon practice, similarly insurance companies do this by offering us less for insurance but charge us a higher deductible if something were to happen with our car.

Just like interest rates with additional features and flexibility, these can cost a bit more than a fixed, low interest rate. By paying a little bit extra in interest rates, you can have a little bit of breathing room when it comes to an unexpected change in events and you may need to change your mortgage.

Some Considerations

Here are some questions you should ask yourself when you consider locking in your next mortgage:

  1. What if I need to refinance due to an unexpected job loss, break-up, unexpected home repairs, etc.?
  2.  Can I put extra money down to pay off the mortgage? If so, how much and when?
  3. Are my closing dates flexible? What happens if they aren’t?
  4. What if I move and sell my house before the mortgage is up?

So, what is the best rate?

Life is unpredictable! We may not be able to foresee our future, especially when signing our first mortgage. A no-frills, low-interest mortgage that can end up penalizing you for adjusting or breaking your mortgage can be devastating! The last thing you want is to be penalized a substantial amount on fees and penalties in unexpected charges.

We’ll sit down with you and go over your present situation, as well as discuss your future needs. We can go over all the options available and choose the best options that will suit your needs.

 

My Mortgage Application Was Denied, Now What?

by
Mortgage Application was denied, now what?

Owning your home is not only a dream but a financial goal for many in Canada. However, factors like housing prices, interest rates, and new mortgage rules that came into effect have made it a little more difficult to get a home.

If you have recently had your mortgage application denied you may be wondering about some of the next steps you can take. Before you put your dream on hold, here are a few things to consider

Why was your mortgage application denied?

The first thing to consider after your mortgage application was denied, was why it was rejected in the first place. Your credit report or credit history may be one of the reasons. A low credit score can sometimes act as a warning sign to your lender. It would be a good idea to check your credit report to see whether it is accurate and then get to work on improving that credit score.

Proof of income might be another reason why you may not get that mortgage. For those that are self-employed or business owners, it may be a little more difficult to get approved for a mortgage, as lenders most often associate them with unpredictable income and are a higher risk.

The amount of debt you have can also affect your ability to get approved. Lenders will look at something called your debt service ratio when considering your mortgage application. Your Total Debt Service Ratio (TDS) is calculated by adding your family’s monthly mortgage payments, property taxes, and other debt payments, then dividing it by your family’s gross monthly income.

Is it really time to buy?

If your mortgage application was denied and you have considered the reasoning behind it, it is probably a good idea to double check to see if it is an appropriate time to buy a home. If right now you find that you have a lot of debt and are having difficulty paying some bills on time, it may be worth it to pay off some of that debt and set up a budget to put towards your home purchase. If you have however gone through your finances and figured that right now is a good time to buy, you can consider other available options.

What other options are available?

It is a big misconception when it comes to big banks and mortgage loans. There are other lenders available. Not only are there other lenders out there, some of them include: mortgage companies, insurance companies, trust companies, loan companies and credit unions.

Mortgage Brokers can help

If your application was denied, an experienced mortgage broker can work with you to help determine if it is indeed a good time for you to buy a home. They can help investigate some of the alternative options available Mortgage brokers negotiate on your behalf and have relationships with various lenders. Meaning a mortgage broker can help get you approved, even if your first application was denied.

5 Important Tips for First-time Home Buyers

by
first time home buyer tips

The cost of buying a home is the biggest investment you will ever make. Buying a home is one of the biggest decisions you will ever make. It can also be a bit complex, especially if you don’t know what to expect. The rising home values and stricter guidelines can also make it difficult for first-time buyers. From mortgages to tax credits, here are some tips to consider if you are a first-time homebuyer.

1) Research the area and the market

Most people looking to buy a home know which neighbourhood or community they would like to live in. Unfortunately, it isn’t really a practical option when it comes to a value-cost perspective. While you are looking at the neighbourhood it is great to check out the local amenities, quality of the neighbourhood and consider what the travel to and from work will be like. Research the area thoroughly and decide what the right compromise might be, given your lifestyle, budget and needs.

2) Work with a broker

Fewer Canadians are going straight to their bank. Instead they are heading to mortgage brokers for a better set of options that are available. There are more than just the five major banks when it comes to the mortgage industry and there is a good chance that a smaller lender will provide you with a better rate. Brokers work on your behalf and look through the market for the best rate for your situation, this isn’t always possible when using a bank.

3) Make use of government programs

There are several first-time buyer governments grants available to help make your home buying experience easier. The Homebuyers Plan allows you to purchase your first home with as little as a 5% down payment. This is a great opportunity to become a homebuyer and start building equity at a younger age. The RRSP homebuyers’ plan also allows you to withdraw up to $25,000 from your RRSP account to buy or build a qualifying home.

4) Don’t feel rushed

Certain markets can create a sense of urgency to buy a home, one that may not even meet your criteria. While it is important to have a sense of purpose when buying a home, there will always be new listings popping up each and everyday. If you set your criteria wide enough, you’ll be sure to find something that suits your needs in a reasonable time frame.

5) Calculate all the costs of homeownership

In addition to your mortgage payment, you also need to factor utilities (heat, hydro and gas), insurance and property tax. When it comes to closing costs, there are also costs associated with buying a home, luckily first-time buyers in Canada save the Land Transfer Tax and get a nice tax refund.

What’s The Deal? Community Mortgage Movement

by
Community Mortgage Movement

I’m Andrew Young of Mortgage Wise Financial and Community Mortgage Movement.

What’s the deal with Community Mortgage Movement?

I originally started the Community Mortgage Movement back in 2016 as a passion project. The whole point of the organization is to give back to the community that has helped to make me who I am today.

With every deal that I do through Mortgage Wise Financial, a portion of the proceeds go back into the community. This is done in two different ways: 1) this is my family foundation, which is through the London Community Foundation and is given in the form of an endowment. For those unaware what an endowment is, it is a fund that is a receptacle for gifts given in perpetuity. The capital of the endowment remains untouched, and only the income from the fund is used for ongoing programs and services.

2) The Community Mortgage Movement has chosen six charities, these charities have been screened and vetted by us to make sure that every single dollar that is donated is going towards someone who is in need. We piggy back on the Vital Signs report, which is released by the London Community Foundation and is released every 2 years. This report helps to identify and fund the greatest impact that will help the London, Ontario community.

When we first started in 2016, we were very successful and were able to give back $10,000 to charities within the London, Ontario community. In 2017, we were able to give back $15,000 and are goal for this year is to give back $20-25,000.

How Can You Help?

You can refer any of your friends, family, colleagues, and neighbours. Not only will they get incredible rates, competitive products, and at the end of the day they are helping out the community they are investing in.

Thank you again for helping to make Community Mortgage Movement so successful.

To learn more about our products and services visit our website

What’s The Deal? Organ Donations

by
Organ Donations Community Mortgage Movement

I’m Andrew Young of Mortgage Wise Financial and Community Mortgage Movement.

What’s the deal with Organ Donations?

So, on May 20, 2018 I turned 40, which is kind of a big deal and calls for a celebration. With me turning 40, it also meant that I had to renew my license through Service Ontario. The fee to get my picture taken was $90 alone, that made me angry.

However, on a more serious note, I received an organ donor reminder in the mail. I would like to talk to you today about Organ Donors. I myself am an organ donor and have been ever since I got my driver’s license. If you can, I highly recommend being an organ donor.

I would also like to mention how important this day means to me, as my father passed away 7 years ago today. He donated his retinas to this beautiful little girl. Because my dad was an organ donor, she now can see now. Even after passing, my dad was able to make an impact on someone else’s life. I personally feel like it is so important to be an organ donor!

Here are some facts about organ donations:

Age alone doesn’t disqualify you from being an organ donor! Did you know that you one donor can save the lives of up to 8 people! They can also enhance the life of up 75 people through the gift of tissue.

Your current or past medical history does not prevent you from registering to be a donor. Individuals with serious illnesses can, sometimes, be organ and/or tissue donors. Each potential donor is evaluated on a case-by-case basis.

All major religions support organ and tissue donation, or respect an individual’s choice.

Check out https://www.beadonor.ca/ to learn out how you can be an organ donor today! It only takes 2 minutes!

What’s The Deal? Low-rate Mortgage Offers

by
London Ontario Low-rate mortgage offers

I’m Andrew Young of Mortgage Wise Financial and Community Mortgage Movement.

What’s the deal with super low-rate mortgage offers?

I just want to go over a few different things before you lock yourself into something you don’t really want or something you don’t really need. What I want you to understand is what are you sacrificing to get a very low interest rate? Here are a couple things you should watch out for on low-rate mortgage offers.

Low-rate Basic Mortgages

These are low-rate mortgages that sometimes may include a reinvestment fee. A low rate basic mortgage will offer you an unbelievably low interest rate. So, what are you sacrificing with this type of mortgage? One of the main things you are giving up is your flexibility. Let’s say you were to break your mortgage after the first five years, there is generally a percentage of a penalty you will pay. So, if you break your mortgage early, you will generally have to pay a penalty (this is normally around 3%). These mortgages need to make their money somewhere! So, let’s say you have a mortgage of $400,000 that is a $12,000 penalty fee!

Reinvestment Fee

Some lenders are adding reinvestment fees into their mortgages. Some of the mortgages that we have seen here have these reinvestment fees added into their mortgage, they have a gradual decline over the five-year period, some dropping by .25% each year.  If you are 99% percent sure that you are going to stay at this property for five years it might be worth it to just wait it out, if not you should start considering other options.

What I like to do is a suitability analysis. We try not to sell rates as much as possible, I would prefer to find out what you need first before I come up with a solution.

I’m Andrew Young and that’s the deal!

What’s The Deal? The Posted Rate Hike

by
Posted Rake Hike London Ontario

I’m Andrew Young of Mortgage Wise Financial and Community Mortgage Movement.

What’s the deal with the recent posted rake hike?

So, what is a posted rate? Well posted rates have been around since before I was born. The posted rate is an intricate sales tactic to lure you into a bank. Back in the day you would walk into a bank and you would see a posted rate on one of their walls. Following that you would then move into an office and talk with the banks’ mortgage specialist. They would then offer you a discounted rate (because you are such a good customer). Let’s say the posted rate is 6% and because you are such a “great” client, they give you a rate of 4.5%.

One of the reasons why a posted rate exists still is to help calculate a penalty. Higher posted rates equal higher penalties. So, what the banks are trying to do is eliminate those people who are trying to secure lower interest rates in going elsewhere. This is a problem with a lot of the banks nowadays, as there are some better variable rate mortgages available elsewhere. So, in short, a lot of people are now leaving banks to go chase a better rate. Therefore, the major banks are increasing their posted rate.

A lot of the lenders (non-banks) that we work with don’t use the traditional bank way of coming up with penalties. Instead they use their regular rates also known as straight rates or discounted rates. It could be advantageous for you to deal with a monoline lender, rather than a major bank. Another interesting fact is that banks do deal with brokers, but these are deals through different channels.

Now is the best time to have a look at your mortgage and make sure it is the best mortgage for you. I’m always here to help.

I’m Andrew Young and that’s the deal!

Self Employed & Looking For A Mortgage?

by
Self Employed London Ontario

What’s the deal with being self employed?

I’m Andrew Young from Community Mortgage Movement and Mortgage Wise financial here to talk to you about being self employed and getting a mortgage if you are self employed.

So, you’re self employed? Well congratulations! So now you want to purchase a home – so, what do you need when it comes to looking for lenders?

Most lenders generally want to see at least 2 years minimum self employed or sub contracted income. When it comes to income, lenders will use a 2-year average from your line 150 from your T1 Generals or your Notices of Assessments. Don’t worry there are some opportunities when it comes to grossing up your income by a certain percentage or we also can add back some of the expenses to help get you to the mortgage amount you are looking for.

There is also the opportunity to use the Stated Income Mortgage Program. What is the Stated Income Program? Stated Income means exactly that. When a mortgage application is created, for a self-employed or commissioned applicant, and the entire income amount is not verifiable in traditional documents, for example a Notice of Assessment, the applicant may apply under the Stated Income program to allow an income adjustment to help qualify them for a home purchase or re-finance.

So, using the Stated Mortgage Program we take your stated income and inflate it by a reasonable rate to take into consideration, due to your profession (this is to consider your expenses and cash components of your job). All of this is to help make sure we can get you to the mortgage you want to be approved for.

I’m Andrew Young and that’s the deal!