- Business Administration Degree with a Major in Marketing from Red River in 2007
I first joined the team of Accredited Mortgage Professionals at One Link back in 2007 when I finished my schooling at Red River College. I worked in the industry for 2 years to become eligible to apply for the Accredited Mortgage Professional designation (AMP) and later that year moved to Calgary and became an underwriter for, at the time, the top mortgage broker lender, FirstLine Mortgages. I spent a year there before moving back to Winnipeg and returning to One Link to once again partner up with Diane Macpherson.
I think it’s very important for people to work with a professional and someone they trust. There is so much information out there and mortgage products that will suit a person’s needs. Rate is important but knowing the mortgage you're getting into is more important, there are a ton of hidden fee’s and restrictions that can be associated with rate specials on the market so make sure you’re talking to a professional to see if a certain mortgage product is good for you. I work for YOU not the lender and better yet my services are FREE!!!
Calling All First Time Homebuyers- Don't Become House Poor!
When looking to purchase a home, two of the most common questions Im asked are, 1) Whats the best rate? and 2) How much do I qualify for? Ill address number one in my next blog post but for now Id like to focus on number two.
As a first time homebuyer, theres never any harm finding out how much you qualify for. With todays stress test used qualify mortgages at a rate almost double what youre actually paying and prudent underwriting requirements, your max purchase price may be what youre looking to spend anyway. HOWEVER, just because you qualify for that amount doesnt mean youre going to want to spend it. What I like to do is let you know what you qualify for and how much the associated payments will be. Then I ask how much are you willing to pay monthly? for your mortgage and other monthly homeownership costs. A lot of first time buyers will then take a different approach to how much they actually can afford. You dont want to end up being house poor. You want to be able to go out for a couple patio drinks with friends on a Friday after work or play on your rec sports team without going into debt. Life is all about balance.
So lets break down the fixed monthly expenses you can expect when buying a house.
1) Mortgage principal and interest payment
2) Property tax (you can deduct $700 from the gross taxes for you primary residence)
3) Life/Disability insurance (the younger you are the cheaper it is)
4) Utilities: Hydro/Gas, Water, Cable/Internet
5) Property insurance
When first time buyers get a mortgage payment quoted to them, that payment is just your principal and interest mortgage payment, it doesnt include all of the other expenses a house brings.
So using a real example;
Min Down payment (5%)
Estimated Closing Costs (2%)
** Extras Include:
NOTE: this is just an example and will fluctuate depending on house and area but is a good guideline.
This example is a good indicator of what types of extra expenses are included in a house that may have been overseen. Make sure you work with a mortgage professional to help you figure out what is manageable for you so you dont find yourself house poor.
Are These Professionals In Your Life? If Not It Could Cost You!
Aside from having professionals like your family doctor and dentist you see once a year, it is very important to have people you trust working for you. People you can phone and pick up right where you left off whether its been 1 month or 5 years. Most professionals work on a commission basis or earn money based on making you happy or continually bringing you benefit. A good professional will keep you up to date and have your best interest front of mind with any transaction you need. Professionals in your life not only help save you thousands of dollars but also help you sleep easier knowing you and your family are being looked after. Here are some professionals you should have in your life;
1) Mortgage Broker- Mortgages are the largest debt you will take on in your life. They are very complex especially with constant changes happening in the industry. You need someone who focuses on mortgages day in and day out knowing which mortgage products are best suited for you so you dont incur large penalties down the road. Mortgage professionals can help you achieve your goals of homeownership and becoming mortgage free faster. Best of all, mortgage broker services are free!
2) Financial Planner- Who wants to retire when theyre 80?! Having a financial planner working with you as early in your life as possible will really help you understand the value of saving early. Financial planners not only help you reach retirement goals, they can help save money on taxes through RRSPs. Theyre also licensed life insurance agents to ensure you are fully covered incase something unfortunate happens. They make a good chunk of their money off commissions, so when you do well, they do well.
3) Realtor- I cant stress enough the importance of using a realtor, especially when you are a first time buyer. It doesnt cost you anything and their opinion on the house, location, resale value are invaluable when everything is so new to you. A realtor is there to represent you and your best interests. They have access to multiple marketing sites and also have valuable information about comparables to ensure you dont over pay when buying and to price your house right to sell it quickly, maybe even receive multiple offers. Working with a realtor you trust is an important asset to you. If youre buying a home using a realtor is no cost to you.
4) Insurance Broker- Who gets home insurance and reads it thoroughly to make sure everything you possibly need to be insured for is insured? I know I dont. Its important to have low insurance payments but its even more important to make sure youre being covered for what you need. Insurance agents are commission based, working with a trusted advisor can help save you time knowing they are looking for the best coverage and premium for your needs.
5) Lawyer- There are 2 types of lawyers I would suggest working with. 1) Family lawyer: these lawyers will help set up wills and amend wills 2) Real Estate Lawyer: some lawyers are well versed in family and real estate law but if you have a lawyer that isnt actively participating regularly in real estate I would strongly suggest you find a lawyer that is. There are many mortgage lenders in the industry, from monolines to banks to credit unions to private lenders and each lender is unique. The documentation a lawyer is required to produce for some monoline lenders is heavier than some traditional lenders but that monoline may offer a better mortgage for you. If youre using a lawyer that isnt familiar with the paper and processes of certain lenders it could end up costing you more in the end for the extra time and efforts the lawyers need to process your mortgage.
6) Accountant- For salaried and hourly people this isnt as important but once you have some fluctuating income, youre a sales person, or business for self, it is very important you have an accountant that makes sure your is are dotted and your ts are crossed. They could save you a ton of money in the end not to mention if CRA comes knocking you want to be sure you have a professional behind you that did your taxes.
7) Health and Fitness professional- You wont need any of the above for a very long time if you dont take care of yourself. In my mind if you dont have your health then your life isnt going to be enjoyable. Whether its walking, running, going to the gym, playing sports, personal training, crossfitting; whatever it is, spend that little extra money each year to make your health a priority. Having a nutritionist and massage therapist isnt the worst thing either. A lot of employees have benefits, which include a certain dollar amount for health each year. I have seen some companies pay for healthy related things like gym memberships, hockey registrations, nutritionist consultations, and massages. So, if you have benefits, make sure youre using them!
8) Car Repair Shop- I dont know a lot of people who enjoy taking their car in to get fixed. Personally I know nothing about cars but I do know when I call my car shop they know me by my first name and dont even have to look up the car Im driving. When I take my car in they could be speaking gibberish to me but because I have someone I trust isnt taking advantage of me and will fix my car right and quickly, I can hand over my keys feeling a little less stressed.
Written by Caily MacGregor, AMP