You may have heard people say “s@@t happens. In the mortgage broker world, JIDD happens. These are unexpected events that can turn a happy homeowners’ life upside down. JIDD consists of:

Job Loss – often unexpected and with no time to save for emergencies, things get ugly pretty quick. E.I. payments can run out leaving you with the option of buying food for the family or paying your mortgage.

Illness – Cancer treatments can be so hard on a person that even if it’s only a 5 minute radiation treatment, you are left feeling unable to work for the rest of the day. Short term disability plans usually top out a 75 per cent of your average salary. However, when you’re ill, your bills don’t drop by 25 per cent. In fact, they often increase due to extra medication, medical equipment rentals etc.

Death – one of the borrowers dies leaving the other person to pay out the mortgage by themselves on one income.

Divorce – once again one income where there were two and often expensive legal fees and bills that get forgotten in a tangle of emotions and a spouse moving out.
While you can find a job again or get over an illness, often there’s a period of time when you need to catch up on your bills and this is when people fall behind in their mortgage payments.

What should you do if you are in one of these situations?
Call all your Dominion Lending Centres mortgage professional and tell them what has happened. Let them know as soon as possible. They will look up your mortgage and let you know who the lender is and who your mortgage was insured with. They can guide you through the process of contacting the lender and insurer to see how they can help you out.
What can CMHC, Genworth or Canada Guaranty do for you? Depending on your circumstances they will allow you a forbearance which is a temporary mortgage payment deferral. They also may change your mortgage amortization lengthening it to lower your payments. They may also take your missed payments and just tack them on to your mortgage balance without a penalty. All these options are available but you have to contact your mortgage professional in order to get the ball rolling. JIDD happens but you’re not alone.

Contact me for your best mortgage options 705.669.7798 or trina@ndlc.ca

#trinamortgages #mortgages #ndlc #freedomofchoice
#bestmortgageforme #executive #firstimehomebuyer

Let’s take a closer look at how a Refinance Plus Improvements mortgage can get you the extra cash you need to get your renovations completed.

The Standard Refinance

An everyday refinance allows the home owner to access up to 80% of the fair market value of the home. The value is typically determined by a Market Appraisal on the home. Here is how it would look:

• Current Appraised Value of the home: $250,000.00
• Max New Mortgage Amount: $200,000.00 ß 80% of present value
• Your current Mortgage Balance: $190,000
• Equity Available to you for the renovations: $10,000.00

*Note: some of the equity will cover closing costs (it is a new mortgage after all, so a new registration and fund advance needs to happen. If you are breaking a current mortgage, there could be a pre-payment penalty as well)

The remaining equity can be used towards your improvements. But what happens if it’s not enough to cover the improvement costs? You’re now stuck with either making sacrifices to your dream reno, covering the additional costs out of pockets, use a higher interest line of credit or not doing the renovations at all. None of which are a great options.

The Refinance Plus Improvements Mortgage

Here is how the Refinance Plus Improvements mortgage can make all the difference.

For argument sake, let’s assume for a moment that the home owner is thinking about renovating their kitchen and main bathroom. These are in no way a small improvement. They are quite significant improvements…new flooring, cabinets, counter tops and paint in the kitchen along with a full gut and renovation in the main bathroom.

After sitting down with a Mortgage Broker to determine mortgage affordability, the home owners next step is getting estimates for the renovations. After having multiple contractors quote on the work, the home owner settles on a contractor that has quoted $20,000.00 for the job (Labour and materials costs, all in, turn key project). Let’s also assume for a moment that the renovations are going to increase the value of the home by $30,000.00 (side note: Kitchen and Main Bathroom Renovations can have the biggest impact on the value of a home). Here is how it would look:

Refinance Plus improvements:

• Current Home Value: $250,000.00
• Post Renovation Home Value: $280,000.00
• New Max Mortgage Amount: $224,000.00
• Your Current Mortgage Balance: $190,000.00
• Equity Available for the renovations: $34,000.00

See the difference? The refinance plus improvements in this scenario can get the home owner access to an additional $24,000, far exceeding the improvements planned for home. No sacrifices required. No unsecured higher interest financing required. No need to tap into personal savings. Just a nice new mortgage with a low interest rate and one simple payment.

If you have questions about how a refinance plus improvements mortgage can make all of the difference with your renovations plans, please feel free to connect with a Dominion Lending Centres mortgage professional near you. We are always happy to chat mortgage strategy with you while at the same time shopping the market and rates on your behalf!

Happy Renovating!

Contact me for your best mortgage options 705.669.7798 or trina@ndlc.ca

#trinamortgages #mortgages #ndlc #freedomofchoice
#bestmortgageforme #executive #firstimehomebuyer