It’s becoming increasingly apparent that a greater number of women are now taking the reigns when it comes to home purchases. There’s a growing trend among single women – and, more precisely, professional single women – who are becoming independent homeowners. While many of them may be putting off marriage, they’re not waiting around for Mr Right before taking the plunge into homeownership.

It’s believed that around 20% of homebuyers in North America are single women based on a 2011 report released by the US National Association of Realtors. Harvard University’s Joint Center for Housing Studies also released a report that said single women are buying in record numbers.

There’s no equivalent data for Canada, but an abundance of anecdotal information has led to the creation of shows like HGTV’s Buy Herself, which follows single women making their first real estate purchases.

Women are looking for ways to become financially independent, and investing in real estate and building equity for themselves are ways to invest in their future – building financial security.

Women are taking advantage of historically low interest rates and recognizing homeownership is often more affordable than renting.

Seeking expert advice

One of the amazing things about women looking to invest in real estate is that they’re getting more advice before they make the decision to enter the market. They’re seeking out mortgage experts and real estate agents, and building a plan for the perfect entry into the market. They’re making lists of areas in which they’re interested in purchasing, itemizing amenities they would need in their ideal neighbourhoods, ensuring they have all the facts around closing costs and fees associated with making the purchase, and securing a mortgage.

Buying a home is likely one of the largest purchases you’ll ever make in your lifetime, and can feel overwhelming. That’s why working with a professional mortgage agent, real estate agent, home inspector and so on is essential. You’ll be working with these professionals closely – possibly for months – so interactions should feel comfortable, and they should be knowledgeable and responsive even to the smallest question.

The more prepared you are, the smoother the experience will be so do a little research on your own over the Internet to get a good idea of what types of properties and areas are of interest to you. Make a list of questions to ask your mortgage agent or realtor – and keep it on hand so you can add to it as more questions arise.

Interest rates are the lowest they’ve been in history and they have nowhere to go but up. Industry professionals believe that as rates begin to rise, they’ll continue to rise for some time. There has never been a better time for women to make the decision to get into the real estate market to find the perfect place to call home and Im here at Dominion Lending Centres to help!

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

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I met with a client recently who wanted to get a pre-approval before he sold his home. His neighbour is a very grouchy man who causes my client and his family a lot of stress. He just wanted to sell his home and move into a new one away from this situation. I had to tell him no and explain that although he has good credit and a very stable job he does not qualify under the new rules. He was saddened to hear that and is now faced with a decision of should he stay and put up with the situation or should he rent out his home and then he himself rent somewhere else.
(Thank you, sir, for allowing your story to be shared)

What happened to cause this? Late last year the federal government made another round of changes to the mortgage rules. This was after we have already seen many previous rule changes over the last seven years. They dramatically increased the qualification rate with the intention that people be able to handle a higher mortgage payment when rates start to rise. They were also attempting to cool the hot real estate markets in Vancouver and BC. Additionally, they changed which properties can be insured which has meant that people with more than 20% equity in their homes have fewer choices of mortgage lenders and/or higher rates. Since that time, they have also increased the mortgage default insurance premium and tightened up lending guidelines. Before the dust has settled on those changes we have been told that further changes are under consideration.

Here is what we need from you. If you or someone you know have been adversely affected by the mortgage rule changes we need you to speak up. Let’s take our freedom of speech for a spin and let our MP’s know of how specific Canadians are being negatively impacted. TELLYOURMP.CA is the site set up that you can easily visit and share your story. Maybe you were turned down or unable to buy a home large enough or in a safe community for your family. Maybe a job loss or divorce means you are looking to purchase on a single income. Whatever the case, please speak up. Visit this website, write a letter, call your MP.
They are doing their best to keep the Canadian economy as strong as it can be but we are seeing a lot of unintentional negative consequences and good Canadians in ALL of Canada are being adversely affected.
TELLYOURMP.CA It will not take you long and it goes directly to your MP. The mortgage industry and all the banks and mortgage lenders are on record but they need to hear from the actual Canadians this is touching most.

Tell your story and don’t spare the details. Speak now in regards to the fallout from the last round of changes and ask for a cooling period before any further changes are implemented. Ask they consult with the wider financial community for input. We need all of you. Whether you are a first-time home buyer, unable to refinance to the best rates, cannot buy that next home you wanted, saw someone you care about be turned down OR if you are a part of an industry adversely affected. Let’s get noisy Canada!

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

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When tough times put stress on families sometimes the end result is divorce. While no one ever wants to see this happen sometimes it is inevitable. Recently, CMHC changed the rules about how much a house can be refinanced for, they have set the limit at 80% of the property value so that refinances would no longer fall under the insured mortgages. What they also did was set some guidelines for couples who are divorcing.

When a partnership in a home is being dissolved, that partnership can be a marriage, common law relationship or simply two owners of a property, it is now considered a sale. This means that the existing mortgage will most likely be paid out or in some cases one of the spouses can assume that mortgage and possibly increase the amount. Most likely it will mean that one spouse will purchase the home from the other. Here’s the difference when we are in this situation, the home can be purchased with just 5% down payment again as it doesn’t fall under the refinance rule.

One other thing to consider under the divorce rules is child support. As many parents have learned lately, child support and section 7 spousal support are liabilities for many lenders. So if you do have a $2,000 a month support payment, then that is the same as having a $2,000 dollar car payment. Not all lenders are looking at that the same, some have allowed us to reduce the yearly incomes by the amount of child support. The biggest difference here is of course that the reduction allows you to qualify for more mortgage, it’s just a matter of knowing which lenders work the system which way and a skilled mortgage broker will know the difference.

Ideally, of course, the divorce never happens but one way around child support being paid is joint custody where it is shared 50/50 and no liability is forced upon either spouse allowing them to maximize their purchasing power as the start their new lives.

What also needs to be considered is that this needs to be done in writing, separation agreements are legal binding documents that tell the lenders what your responsibility is to the other partner in the divorce. We have also had situations where a statutory declaration saying that you have no responsibility to the other partner has been sufficient especially in cases of common law separations.

So many in’s and out’s to be considered when embarking on dividing your households and of course we here at Dominion Lending Centres would always advise legal counsel first and then talk to me your mortgage broker about what is required for the mortgage process.

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

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The level of documentation required for the average mortgage these days can be very frustrating. It can seem endless, very nitpicky and annoying because we are able to purchase a vehicle with just a paystub. There are a few reasons for the increased documentation requirements.

The first is that the banks are mandated by the Anti-terrorism Act to make sure all funds are legally sourced. Criminal organizations do exist even  in say, Central Alberta, and they are clever and will launder their funds however they can.

I had the opportunity to attend an anti-fraud session led by the Edmonton police and he told a story of how a routine bylaw infraction led to the discovery of a criminal enterprise which involved more than 32 million dollars in mortgage fraud. Police resources, insurance proceeds, court time and on and on mean there was a genuine cost to the greater community. Increased due diligence prior to funding can help catch such things ahead of time.

The second is that your banks and mortgage lenders are accountable to the mortgage default insurers and their company’s investors and shareholders and to OSFI which oversees them all. If you default on your mortgage they have to be able to prove that they took every step possible to ensure you were in fact a solid borrower qualified for the mortgage.

Honestly it boils down to this. If you were lending someone $350,000 wouldn’t you want to make sure they could afford to repay you?

So back to down payment sources. When you are providing documentation for your mortgage it is going to have to be pretty clear. It will have to show your name, financial institution holding said asset, account number and all transactions into the account for the past 90 days. Any deposits over $500 will have to be properly accounted for as per the above rationale. A quick reminder that you will have to have at least 5% to put down and an additional 1.5% for the closing costs so 6.5% all together though these days the banks and the mortgage insurers really like to see additional savings just in case you experience a job loss or illness.

Here are the most common and acceptable down payment sources and how each is to be verified. Keep in mind that you can use a combination of them but you will have to provide verification of each.

1. Savings – All accounts will need to be verified via a 90 day history

2. TFSA – Must be verified via a 90 day history

3. RSP- Will require a 90 day history and in most cases verification that the funds have been redeemed via the forms to the RSP provider and have been deposited into your account

4. Gift – from an immediate family member. Need to see a signed gift letter stating it is in fact a gift which is not expected to be repaid and proof it has been deposited to your account. In some cases they will want to see the source of the gift which means a statement from the person giving you the funds.

5. Loan – You can use borrowed funds for your down payment through certain lenders. They will need to verify the terms of the loan if it is new to make sure you can afford both it and your mortgage.

6. Credit Card/Line of Credit – This is similar to the loan as above but in this case you usually only have to prove you can afford the payments for both.

7. Sale of Asset – You can sell anything you own but make sure you document it properly. Bill of sale, copy of the cheque and proof it has been deposited to your account.

8. Gifted Equity – If you are purchasing the home of a family member and they wish to, they can gift you the equity in the home and this can be used as the down payment.

9. Inheritance – This is usually verified via the documents form the lawyer with corresponding deposit to your account

Sometimes I (and my colleagues at Dominion Lending Centres) get questions about rare occurrences such as a lotto win. Even in this case, which I have actually seen, there is a paper trail.

So called mattress money is no longer acceptable unless you can show you have held it in a traditional account for the 90 days.

Banks and mortgage lenders are stuck abiding by the rules which mean that so are we all.

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

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For many people, a home will be the largest purchase of their life. It stands to reason then, that when you are shopping around for your mortgage you will want to take certain steps to ensure you are getting the sharpest rate and best product. We have a few pointers to make you a savvy shopper when you are out looking at different mortgages—get ready to take a few notes.

1. Do not always rely on the bank for the sharpest rates
Mortgage Brokers can often beat the bank rates by using different lenders. They can also often get you a SHARPER rate at your own bank simply because of the high volume that they do with them. Brokers have access to a number of different lenders giving you more options for not only the best rate, but also the best product for YOU.

2. Know your credit score
Your credit score is a large factor in your mortgage application. You need to know where you stand with your credit BEFORE you begin the process of shopping. All lenders will look at your credit history and score first then they build a file around that. A mortgage broker can obtain your credit score in mere minutes-all you have to do is ask.

3. Make it a one-stop shop
Avoid shopping from institution to institution. You may think that more options lead to better rates, but in fact lenders will frown upon you having your credit score pulled multiple times. This is where the benefits of using a broker come into play. They will pull your score ONE time only and use that to shop around with lenders for you. Really, it’s like having your own personal shopper!

4. Understand that the market will change.
Starting the shopping process knowing that the market you qualify in TODAY will adjust is key. Rates might be low right now, but new rules and implications can change things when you are up for renewal. Understand that you MUST be able to carry your mortgage payment on at a higher rate if new laws are put in place.

Keeping these 4 Savvy Shopper tips in mind when you are shopping for a mortgage can help set you up for success not only today, but for the future as well. Mortgages are not only about finding the best rate-but finding the best product too. As a Dominion Lending Centres mortgage specialist I can work with you and your unique situation to find you the best product for you—and as an added benefit do the shopping for you!

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

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I recently read an article by Jamie Hopkins in Forbes magazine, entitled “Americans Don’t Even Know What Their Most Important Retirement Asset Is.”
The article highlighted three common misconceptions about reverse mortgages and unsurprisingly, they are prevalent in Canada as well as in the U.S.
Top 3 misconceptions about Reverse Mortgages:
1. The bank owns your home.
2. Your estate can owe more than your home
3. The best time to take a Reverse Mortgage is at the end of your retirement

Let’s examine each misconception in more detail.

1. The bank owns your home.
Over 50% of Canadian homeowners over the age of 65, believe the bank owns your home once you’ve taken a reverse mortgage. Not true! We simply register our position on the title of the home, exactly the same as any other mortgage instrument, with the main difference in the flexibility of not having to make P&I payments on the reverse mortgage.
2. Your estate can owe more than your home.
A reverse mortgage, unlike most traditional mortgages in Canada, is a non-recourse debt. Non-recourse means if a borrower defaults on the loan, the issuer can seize the home asset, but cannot seek any further compensation from the borrower – even if the collateral asset does not fully cover the full value of the loan. Therefore, when the last homeowner dies (and the reverse mortgage is due), the estate will never be responsible for paying back more than the fair market value of the home. The estate is fully protected – this is not the case for almost any other mortgage loan in Canada, which is full recourse debt. So read the fine print the next time you offer to co-sign for a loan for mom!
3. The best time to take a Reverse Mortgage is at the end of your retirement.
This is a common mistake that reflects an “old-school” financial planning mentality. For the majority of Canadians (without a nice government pension), the old school financial planning mentality is about cash-flow, and is as follows:
a) Begin drawing down non-taxable assets to supplement your retirement income.
b) Once your non-taxable assets are depleted, begin drawing down more of your registered assets (RSP/RIF) to supplement retirement income.
c) Once your registered assets are depleted, sell your home, downsize and re-invest to generate enough cash-flow to last you until you die.
The problem with the “old-school” financial planning model is two-fold:
1. 91% of Canadian seniors have no plans to sell their home (CBC News “Canadian Boomers Want To Stay In Their Homes As They Age).
2. You are missing out on a huge tax-saving opportunity by not taking out a reverse mortgage in the beginning of your retirement.
“Research has consistently shown that strategic uses of reverse mortgages can be used to improve a retiree’s financial situation, and that reverse mortgages generally provide more strategic benefits when used early in retirement as opposed to being used as a last resort.” – Jamie Hopkins, Forbes
In Canada, a reverse mortgage can be set-up to provide homeowners with a monthly draw out of the approved amount. For example: client is approved for $240,000 and decides to take $1,000/month. This is deposited into the clients’ bank account over the next 20-years. Interest accumulates only on the amount drawn (ie: not on the full dollar amount at the onset).
This strategy allows clients to draw down less income from their registered assets to support their retirement lifestyle. In turn, this can create some excellent tax savings, since home equity is non-taxable. Imagine lowering your nominal tax bracket by 5 – 10% each and every year over a 20 year period? The tax savings can be huge. You are also able to preserve your investable assets, which historically, can generate a higher rate of return when invested over a greater period of time.
In summary, Canada and the U.S. both have aging populations and both have misconceptions about reverse mortgages. Learning about these misconceptions will allow you to offer your clients the best advice on how to balance retirement lifestyle and cash-flow, with the desire for retirees to age gracefully within their own homes. If you have any questions, please contact me your local Dominion Lending Centres mortgage specialist.

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

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The following is from an interview with HGTV’s Bryan Baeumler for the Summer issue of Our House Magazine. Baeumler has called the state of the prime minister’s residence in Ottawa a national embarrassment, but successive occupants have been wary of a backlash should they launch an expensive rebuild. Baeumler thinks it can be done for a fraction of the cost cited.

Over the last decade as Canada’s No. 1 do-it-yourself builder, Bryan Baeumler has proven he’s not afraid to tackle a difficult renovation or build. But there’s one address even he might have to think twice about before getting his hands dirty.

For years, 24 Sussex Drive in Ottawa, better known as the official residence of the prime minister, has been in disrepair and in need of a complete makeover. And Baeumler hasn’t been shy to offer his opinion about the Canadian version of the White House. During a television interview, he called the home an “embarrassment.” The comment may have made some waves, but he isn’t about to walk it back. And he has the knowledge to back it up.

He’s talked to prime ministers and their families who have lived there and understands the history behind the home. As he explains, it wasn’t originally built for the leader of the country and during a massive renovation years ago, much of the heritage was stripped away. Also, the home is filled with asbestos and the heating and ventilation systems are inefficient.

While 24 Sussex may desperately need a little more than hammer and nails, Baeumler believes politics has left the residence in its shabby condition. Successive prime ministers have been reluctant to be the one to spend the money needed to make the home livable.

“The guy that’s in there that pulls the trigger and says, Let’s fix my place up,’ he’s going to get roasted and I think that’s an asinine and immature way for our political system to operate,” Baeumler says. “I think it’s the wrong view for Canadians to take. It’s not the prime minister’s house, it’s owned by Canada. To me it’s not political, it’s a piece of our Canadian infrastructure the government and people of Canada own. It’s a dump, so let’s put it out to a couple architects to rebuild it.”

He also suggests the cost doesn’t need to be in $1,500-per-square-foot range that’s been floated around. Instead, he believes it can be done properly for about $300 to $400 a square foot.

So is he the right guy to take on the job? While he admits it would be a cool project, he says there are other talented builders in the country who could do a great job.

“I like a challenge,” he says. “My favourite jobs are where we go into an old heritage home built on a stone rubble foundation that is in imminent collapse as possible and restructuring that thing and turning it back into something that’s a work of art. That’s the kind of stuff I would love to work on. Twenty-four Sussex is a home like that, but I think there’s much more interesting properties in Canada for sure.”

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

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Some of you are going to ask what is a ARM and VRM? These two acronyms are mortgage speak for adjustable rate mortgage and variable rate mortgage. These two mortgage products are both based on the prime rate of interest, in most cases this is 2.70% at the bank. TD chose to be higher by .15% at 2.85%, so it isn’t controlled by the Bank of Canada. It is an individual financial institution policy.

With the Bank of Canada hinting strongly at moving up the interest rate, most likely by .25%, we will see an increase in the prime rate most likely to 2.95%. If you have an adjustable rate mortgage then you will see your monthly payment increase to match this new rate. So an Adjustable Rate Mortgage moves up with prime and you continue to gain ground by making your payments.

Variable rate mortgage is different. The VRM works like this, your monthly payment will stay the same but you will now be paying less to principal and more to interest. Not a good scenario if you are trying to pay down your mortgage and gain some equity. In this changing market, we suggest that you review the scenario with your lender and make sure that you are keeping up with gaining on your mortgage. The other scenario can also be that if you don’t adjust your payment that you could end up paying only interest and not be paying down the principal at all. And remember, as a Dominion Lending Centres mortgage specialist I can help answer any questions you have.

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

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Parents are always worried about something with their children, and where they are going to live and how they are going to afford it is no exception.
The bank of mom and dad is a common source of down payment for their children, and the strategy continues to grow with the significant rise in prices and wage gap growing in today’s marketplace.
For example, some people in the upper middle class are buying properties for their kids and grandkids and the benefits are multifaceted: they generate income now, while someone else pays the mortgage (a tenant) and the value increases.
The families can then refinance at a later date and gift some equity that was pulled out what was essentially paid for by a tenant and continue generate income to assist with retirement, since a lot of these homeowners don’t have the company pensions that were available a generation ago. However, even this group feels they are in crisis by not having enough cash flow to save for retirement. But with the above strategy, essentially your downsized home was purchased early with the basic principal of time working in your favour to get further ahead financially so everybody wins without sacrifice in this scenario.
Our demographics are changing rapidly and this is something that is motivated by families who want to keep their children close to them and hope to have them enjoy the same lifestyle they have created. The majority of Canadians implementing these strategies are households earning $200,000 a year and have a net worth of over $2 million, including real estate.
The amount parents have gifted their children has changed dramatically with the inflation changes over the years. In the 1980s, a gift for a down payment averaged $10,000, but today that amount is between $200,000 and $500,000!
According to mortgage insurer Genworth Financial, 40 per cent of first time homebuyers in Vancouver had help from their parents, compared to 22 per cent in the rest of Canada.
These strategies are often not commonly considered and depending on the mortgage-provider choices you make early on, having a provider like a Dominion Lending Centres mortgage professional who focuses on these wealth building strategies will help you avoid missing opportunities.
Anybody can get you a mortgage, however, a proactive provider can assist you and show you what the wealthiest Canadians are doing so you don’t not miss opportunities.

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

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You have a family member that doesn’t qualify for a mortgage on their own and needs a co-signor. Since you’re a nice person, and of course would like to see your son/daughter/parent/sibling in a better position, you agree to co-sign for the mortgage.

If I had a dollar for anytime I’ve heard the phrase “but I’m only co-signing right, they can’t come after me for the money or touch my house?” I’d be rich!

There are many common myths around co-signing. Here’s only a few and the truths associated with each one…

• I’m only co-signing for my family member to get the mortgage and that I won’t have to ever make payments. False: You are equally responsible for making the payment on the mortgage. If the borrowers default, you will be required to pay.
• I can’t be sued for non-payment since it’s not my mortgage. False: The lender has all legal collection methods available to them to collect payment from you, including obtaining judgment in court and possible garnishment of wages and bank accounts.
• The bank can’t take my house if the borrower loses theirs. False: As per the second myth above, judgment action can also involve seizure and sale of any of your assets including and not limited to your own home.
• I’m only a co-signor or a guarantor so I’m protected from not having to pay. False: Whether you are the borrower, co-signor, or guarantor, you are fully responsible for the debt.
• Co-signing on this debt won’t affect my ability to obtain credit in the future. False: Not only will you legally have to declare the co-signed debt when you apply for credit, but also most lenders in Canada are now reporting to the credit bureau and it will appear when you apply. Either way, the mortgage payment must be factored into your debt service ratio.
• Since this is only a five-year term, I am automatically released from this mortgage in five years. False: Regardless of term, you remain on the mortgage until it is paid in full or released only with approval from the lender.

Here’s a few tips and questions to ask before agreeing to co-sign on a mortgage…

• Know the borrowers’ situation. What is there credit like? Are they drowning in debt? Why exactly is a co-signor required?
• Is there an exit strategy to have your name released and how long will that take?
• Add your name to title of the property so that the borrower cannot add a second mortgage to it. This is an asset that you have an interest in and therefore should protect it.
• Get independent legal advice about your obligations as a consignor.
• Be prepared to make the mortgage payments of the borrower doesn’t.
• Don’t be afraid to say no to co-signing if it doesn’t feel right.

Knowledge of the borrowers situation, your obligations, and potential ways to protect yourself (and of course setting emotions aside) is the best advice for anyone co-signing. And if you have any questions, please contact me your local Dominion Lending Centres mortgage specialist.

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

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#bestmortgageforme #executive #executive

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