Hi everyone:

I just came across an excellent resource for mortgage rate, interest rate, insurance rate and credit card rate information.  Check out the blog at ratesupermarket.ca

This site features input by some very impressive contributors.  While NO ONE can predict interest rates with 100% accuracy, being able to draw on the experience of some of the countries top mortgage experts gives ratesupermarket a nice advantage in this effort.

The site blog includes categories such as Mortgage Tips, Housing Market, Real Estate and dozens of others.

This month’s Mortgage Rate Outlook predicts that fixed rates are expected to remain the same, ‘with downward bias’,  and variable rates are also expected to remain the same.

This continues to be an excellent time to purchase a house or condo in Winnipeg.  Inventory levels are up slightly, and due to summer vacations, buyer activity is down a little, meaning that your chances of finding and actually getting a house are increased.

If you’re looking to purchase a home (house or condo) in Winnipeg, please call me anytime.  Bo 204-333-2202

You don’t have to tell the average Canadian homeowner that real estate is a good investment. With very few exceptions, home equity has been building across Canada, and many Canadian homeowners have determined that two or more roofs are better than one. There are several reasons why a growing number of Canadians are purchasing investment properties:
1. Return on investment. Certainly, residential real estate is a solid long-term investment, typically appreciating faster than inflation. Even Canadians who have chosen their stock portfolio very carefully may find that their home is their best-performing investment. Many investment advisors recommend diversifying stock and bond portfolios to include real estate. Initially the goal is to have rental income cover all or most of the costs of the property. Over time the goal is to see an increase in the value of the real estate, with rent turning to profit once the mortgage is paid off. Expenses related to the property are of course tax deductible, offsetting the rental income.
2. A pension plan for the future. Over the long term, an investment property or multiple real estate holdings can be a great source of retirement funds. Many Canadians do not have a pension plan, which means they need to take their own action to create sources of retirement income.
3. A better alternative to student residence. Many Canadians are shipping off their university-age children, and housing them in an investment property purchased specifically for that purpose. They can save money on out-of-town accommodations for the student, and use revenue from other renting students to pay the mortgage and maintenance expenses.

4. Earlier access to a first home. For first-time home-buyers, a duplex or triplex can be a terrific way to get onto the home ownership ladder. Rental income from the extra units can help offset the cost of the mortgage as the new homeowners get on their financial feet.  Rules have changed however for investment property mortgages since the government’s new mortgage rules that came into effect April 19, 2010. A minimum downpayment of 20% is required for an investment property i.e. you’re not personally living in the property that you own, which is up from 5% prior to the new rules. You can put down less than 20%, but you’ll need to use an uninsured lender, which can mean higher interest rates. If you only have 1 to 4 properties, there are several CMHC lenders from which to choose from. Once you have more than 4 properties you need to start spreading out your business among several lenders so as to not reach the maximum number of mortgages a lender will approve per investor.
Other underwriting or qualifying rules have also come into play; Canada Mortgage & Housing Corp (CMHC), Canada’s largest mortgage insurer, has changed the way they treat rental income in their debt service calculation, which can make qualifying more difficult.
Sound confusing? It absolutely is. That’s why you need to speak with an experienced mortgage planner who can help you better understand what’s involved in financing investment properties. There’s no cost or obligation. We’re up-to-date on current rates and all of the opportunities available for property investors from all of the lenders in the marketplace. Whether you need an investment property mortgage or just looking for some advice, a mortgage broker is ready to help!  See my website at Igloo Mortgage

That first fresh breath of spring always sets us in motion: we can’t wait to sweep away the clutter. Sure it’s a bit of work, but it feels great when the lawn is raked, the windows and curtains are washed, and the closets are cleared. Just like the clutter that sneaks up in your closets, you can also accumulate debt clutter: credit cards, car payments, tax bills and other obligations.

If you’re concerned about your debt clutter, then this may be the year to spring clean your debt. With mortgage rates still at historic lows, this spring you have an incredible window of opportunity. By using your home equity, you can consolidate your high-interest debt into a new or existing mortgage, giving you interest savings and a new lower monthly payment. In almost every case, you’re better off holding your debt in a mortgage than in any other lending vehicle.

Why? Because we continue to benefit from mortgage rates that are still among the lowest in decades. Worried about penalties to break your current mortgage? We can assess your situation; there’s a good chance that the savings each month will far outweigh any penalties. Here’s an example.

Consider the following situation:

Your current mortgage is $155,000 at 5.5% with a monthly payment of $946.
You also have a car loan of $20,000 and credit cards maxed out at $20,000, both of which cost you $920 a month
Your total monthly payment is $1,866

Your mortgage planner presents the following scenario:

You get a new mortgage for $202,000 to cover the original $155,000, the $40,000 in credit cards and car loan, and $7,000 to break your mortgage.
Your new mortgage is at 4.10% and you now have a much lower overall monthly payment of $1,074 With this new scenario, monthly payments are $792 less each month; a great improvement in cash flow!

And if you put $425 of that cash flow into your mortgage payment, you reduce your amortization from 25 years to 15. We’re a fortunate generation of homeowners. We can benefit from low mortgage rates to enjoy our lives and our homes – and to manage our debt wisely. Independent mortgage planners – who have access to more than 50 different lenders, including most of the major banks – have become specialists in helping Canadians restructure debt. In addition to offering access to a broad range of mortgage options, these experienced planners provide credit advice and debt management tips that can help save thousands of dollars.

Consider if you need a clear and simple look at what you’ve got to gain from spring cleaning your debt. We don’t know how long these great rates will last but right now, it is a historic opportunity. If too much debt has slowed your monthly cash flow to a trickle, it’s time to talk to a mortgage planner. And why not? It will be the easiest spring cleaning task on your list; your mortgage planner will do all the work!
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Hi everyone:

For most of us, buying a home means financing your purchase with a mortgage. Most often, getting a mortgage depends on your how good your credit score history.

While most consumers know that they have a “credit rating,” not all know their scores or how they were calculated. If your mortgage application is refused, or approved for less than expected, there’s an opportunity for you to improve the score.

Your creditworthiness is assessed two ways:

• Beacon score, and
• A detailed history.

Credit scores range from 350 (low) to 850 (high), with 680 being the median. The numerical score is calculated based on previous payment history, current indebtedness, credit history length, number and frequency of new credit inquiries and, the types of credit held. Two so-called “Beacon killers,” are payments more than 30 days late (even small amounts) and maxed-out credit cards. The detailed history adds personal information, banking information and specifics on accounts and payments.

Maintaining and improving credit depends upon:

1)            Pay all bills on time – late payments hurt your rating

2)            Keep credit balances below 75%of the maximum

3)            Avoid applying for additional credit; too many applications in a short period signals financial difficulties

4)            Make sure that personal information in your credit file is correct

You should also review your credit history at least once a year, it is free when requested in writing or by fax.

How can a Mortgage Broker help?

Getting your finances in order can be a daunting task. A Mortgage Broker can help you assess your current credit situation and help you determine a path for credit improvement. A Mortgage Broker will work with you to find a solution for your unique financial situation.

For more information on managing credit refer to Service Canada’s website or contact your Mortgage Broker today!

Building and maintaining good credit can help to ensure mortgage approval!

For most of us, buying a home means financing your purchase with a mortgage. Most often, getting a mortgage depends on your how good your credit score history.

While most consumers know that they have a “credit rating,” not all know their scores or how they were calculated. If your mortgage application is refused, or approved for less than expected, there’s an opportunity for you to improve the score.

Your creditworthiness is assessed two ways:

• Beacon score, and
• A detailed history.

Credit scores range from 350 (low) to 850 (high), with 680 being the median. The numerical score is calculated based on previous payment history, current indebtedness, credit history length, number and frequency of new credit inquiries and, the types of credit held. Two so-called “Beacon killers,” are payments more than 30 days late (even small amounts) and maxed-out credit cards. The detailed history adds personal information, banking information and specifics on accounts and payments.

Maintaining and improving credit depends upon:

1) Pay all bills on time – late payments hurt your rating
2) Keep credit balances below 75%of the maximum
3) Avoid applying for additional credit; too many applications in a short period signals financial difficulties
4) Make sure that personal information in your credit file is correct

You should also review your credit history at least once a year, it is free when requested in writing or by fax.

How can a Mortgage Broker help?

Getting your finances in order can be a daunting task. A Mortgage Broker can help you assess your current credit situation and help you determine a path for credit improvement. A Mortgage Broker will work with you to find a solution for your unique financial situation.

Hello Everyone:

As you may have heard, The Government of Canada has just announced new standards to Government-backed mortgages.  Even though these were just announced today, I’ve already been asked twice about possible implications for home-buyers (especially First-Time Buyers).   I’m happy to say that, in MY opinion, these rules should NOT have a negative impact on buyers, or the housing market in general.

Two possible changes which had been CONTEMPLATED, but are NOT being implemented, are the increase of the minimum down-payment from 5% up to 10%, and the shortening of the amortization period to 30 years.  I believe that the first of those, (the increase of a down-payment) would have had extreme negative impact on the housing market.  The majority of our hot market is being driven by “First Time Buyers”, who, in most cases, have a 5% down payment saved up, in addition to the 1-1/2% to 2% required to pay for Land Titles Transfer Tax, legal fees other such taxes and costs. Thankfully, the Government chose to leave those requirements untouched.  Here are the 3 items they DID change (starting April 19th, 2010)  and how they might impact home buyers:

1)  Buyers must qualify for the 5-year Mortgage Rate

Excellent Move.  Well, actually, most reputable financial institutions already had this rule in place in the last year or more.  Here is the scenario that the Government is trying to avoid (and incidentally, this is one of the major reasons for the housing ‘melt-down’ in the U.S.).  Here is an example:

• Home Buyers want to buy a $300,000 home with 5% down, meaning a mortgage of $285,000.

• A 5-yr mortgage rate is at 5% with a monthly payment of $1657 (Principal plus Interest)

• Buyers income only qualifies him/her for a payment of $1400 per month.  Clearly the house is out of their reach, right?  well, not so fast…

• The bank has an “Introductory Rate” of 3% over 6 months, after which the mortgage then goes up to full rate of 5%

• The Intro-Rate of 3% means a monthly payment of $1348, well within the (very happy) buyers abilities.

• Buyer moves into his house, and after 6 months, the rates go up and beyond his means

What this first rule change stipulates is that in order to buy this house, the buyer must qualify for the 5-year rate, no matter how low the intro-rate is.  I believe this is a good thing, as it protects the buyer in the long run.

2)  Amount of Re-Financing on a home is limited to 90% of the home’s value (down from 95%)

Currently, homeowners (with presumably excellent credit) can borrow up to 95% of their home’s value.  This will be reduced to 90%.  Again, it’s Governments attempt to protect the home-owner from over-extending themselves.  While I feel this is also a good thing, I doubt that it will effect a large group of people.

3)  “Purely Investment” type home purchases to require a minimum of 20% down

This deals only with non-owner occupied residences.  So for example, if you wish to buy a duplex or triplex, then reside in one unit and rent out the rest, you would still be eligible for the 5% down-rule.  If you are purchasing a residential property of 1 to 4 units, and use the entire property as a rental property, you will now have to come up with 20% down.  This may effect primarily the ‘first-time investor’, who was hoping to get into the rental market with only 5% down, as many seasoned investors will not have much trouble coming up with the added down payment (although they might not LIKE it much).   Is this a bad rule?  In my personal opinion, setting the requirements for investment properties a little higher is not a bad idea.  From my own observations, far too many people try to get into the real-estate investment market without adequate knowledge, training or information….  and NO, watching 3 episodes of “Flip This House” does not qualify as training.

So, in summation, I do not believe that these new rules will do anything to slow down the market, or inhibit first time buyers (which is NOT their intent).  If they wanted to slow down First Time Buyers, they should have consulted with our Provincial Government on how to charge Land Titles Transfer Tax, (which in Manitoba costs the average buyer approx. $2,000).  But that’s the subject of another blog-post altogether.

Comments, suggestions and feedback always invited…..

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Hello Everyone:

These days, every home or condo buyer in Winnipeg knows that, at a very minimum, they need to be pre-approved before shopping for a new home.  But being pre-approved by the RIGHT lender is just as important.  With almost unlimited choices, between Banks, Credit Unions, private lenders and mortgage brokers, whats the best choice for today’s home buyer?  Many are turning to Mortgage Brokers, for a variety of reasons.  Here are some very important ones to consider:

Ten great reasons why you should talk to a mortgage broker

A home is the biggest purchase most of us will ever make.

And a mortgage can be a powerful financial tool. No surprise, then, that a growing number of Canadians have started to ask some smart questions about their mortgage. In fact, more than 30% of all Canadian mortgages are now arranged through mortgage brokers. Why? Here are 10 great reasons:

1. Choice.

A broker has access to mortgages from a huge range of lenders – so their clients have by far the best choice of rates and mortgage options. With partnerships in a vast network of over 50 lending institutions, including banks, credit unions, trusts, national and regional lenders, and non-traditional lenders, your broker can help design the perfect mortgage for you.

2. Independence and objectivity.

A mortgage broker actually works for you, not for any one lender. That kind of objectivity means that you – the client – are the focus. They fit the mortgage to the client, not the other way around.

3. Negotiating power.

Mortgage brokers have negotiating power because the lenders compete for their business. You’ll get the best rate for your situation.

4. Access to rate promotions.

You may not realize it, but there are sales and promotions in the mortgage world, too. Lenders often offer special rate promotions, for example. Your broker will know about these special offers, and whether they might work in your situation.

5. Expertise.

An AMP-designated mortgage broker is a financial specialist. That’s the kind of expertise you want to guide you through today’s plentiful mortgage market. With 35-year amortizations, re-advanceable mortgages (mortgage combined with a line of credit), no income documentation products for the self employed, credit repair and debt consolidation solutions, today there are mortgages for almost any situation. And your independent mortgage broker knows them all.

6. A focused specialist.

A mortgage is a very significant financial event. Mortgage brokers are in only one business, and they do it exceedingly well. That’s what you want: someone who’s focused on the mortgage marketplace and your needs.

7. Rates.

Getting a lower rate can potentially save you thousands of dollars. That’s why more homeowners are more likely to call a mortgage broker to check out their options for their first mortgage and at renewal.  Call early; your mortgage broker can usually guarantee an interest rate for 90-120 days.

8. One credit inquiry.

Rate-shopping on your own can actually be hazardous to your credit. Every time a lender checks your credit, the credit bureaus take notice. Too many inquiries and your credit rating can weaken, possibly affecting the rate and terms of your mortgage. Your broker does one inquiry only, regardless how many lenders you’re looking at.

9. No cost to you (o.a.c).

As a rule, the winning lender pays compensation to your broker for the services and solution provided.

10. Personal attention.

You need a mortgage plan that is a custom fit for you, and a broker who keeps in touch with you during your mortgage years. Keep in mind that their business is built primarily through referrals from satisfied customers, so your positive mortgage experience is essential for their ongoing business growth.  Your mortgage is a big decision and a powerful financial tool.

http://www.WinnipegHomeFinder.com/buying.html Whether you are a first-time buyer, or moving up to a larger home or condo, if you need financing, this video will help you choose the mortgage lender thats right for you!

For Home-Buyers, getting pre-approved is an absolute necessity.  But these days, being pre-approved is only half the battle.  The real benefit comes from being pre-approved by the RIGHT lender.

With dozens of banks, credit unions and mortgage brokers to choose from, how does the home-buyer make his selection?

The answer is: ask a qualified REALTOR to make a referral.  The benefits are many, as this video explains.