10 Things to Consider before your mortgage renews
10 Things to Consider before your mortgage renews
By Vince Bowry, Mortgage Agent
For many Canadians, renewing your mortgage can be a challenging decision. Life changes quickly, and we often need to adjust our finances accordingly. Whether you have young ones entering day care, young-adults venturing off to University, or if you just need some extra cash for that home renovation that youve been dreaming about for years, there are many options to ensure that your mortgage fits into your lifestyle.
1. Have you explored all your options? Once you receive your mortgage renewal statement, theres nothing easier than simply signing on for another term. But while this may make sense in many cases, your family or financial situation may have changed over time. We can look for opportunities that could better meet your needs today.
2. Are you comfortable with your payments? If youve been feeling financially strapped each month making your mortgage payments, this could be the time to reduce them to a more easily managed level. On the other hand, if youre earning more, why not pay down your mortgage faster and save thousands of dollars in interest over time?
3. Do you need cash flow for other things? Your priorities and cash flow needs may have shifted since you first bought your home. Things like paying for a child care, planning a career change, or a child entering university/college may call for spending money on things other than your home. You may be able to refinance your mortgage to take this into account.
4. Can you handle fluctuating rates? Some homeowners are nervous about any hikes in interest rates, while others are comfortable to go with the flow. Its best to base your decision on your personal situation, and tailor your mortgage renewal around your needs. We can help you decide whether to opt for fixed or variable rates and we dont want you to lose any sleep over your decision!
5. Are you thinking about a major renovation? You know that projects such as a new kitchen, a finished basement or an addition can make your home more valuable, but the cost of having the work done can tie up a lot of money. Before you renew, look at all your financing options, which may include getting an additional line of credit or keeping your monthly mortgage payments low so you have money on hand to finance your renovations.
6. Will you sell soon? If you are likely to sell soon, consider a shorter-term mortgage (6 months- 1 Year) or one that has flexible terms so youre not penalized if you sell your house before the mortgage comes due.
7. Could you use your home equity to fulfill other goals? Refinancing a mortgage can be one way to free up cash you need for other things, which could even include buying another property. Mortgage renewal time is an ideal occasion to review all your options.
8. When do you want to be mortgage-free? If youre planning extended time away from work or perhaps an early retirement, it may make sense to pay down your mortgage sooner rather than later. While increasing your payments will raise your monthly costs now, youll ultimately save on interest in the long term and can prepare for that fabulous, mortgage-free lifestyle.
9. Have your insurance needs changed? If your financial situation has changed since you first took out your mortgage, review whether you need the same level of insurance in place to cover mortgage obligations.
10. Are you getting the best rates and terms? In a competitive mortgage environment, your good credit history can make refinancing work to your advantage. We analyze mortgage markets daily to ensure you dont miss any money-saving opportunities.
To learn more about your mortgage renewal options, contact me at email@example.com or call me at 519.212.2671.
Top five home renovations that increase property value
Looking to increase your homes property value? Here are five of the best renovations you can do to your home to increase property value. These five renovations can sometimes have a return on investment 5-6x what they cost.
Flooring is one of the most important aspects of your house. You will see an immediate rise in property valuation with the installation of hardwood floors. Existing hardwood floors that you can refinish are ideal as they are less costly to restore and in higher demand than new flooring materials. For the bathroom, tile will always be in demand and retain value exceptionally well.
Kitchens often look tired and dated, in large part due to old fixtures. Replacing or updating cabinet hardware, light fixtures, countertops and faucets will result in an immediate increase in your homes value. This small, but effective upgrade will also revitalize the entire home. Pot lights are in high demand in open concept style homes.
Thebathroomis the second most important room in the home in terms of valuation. If you can add a three-piece bathroom to a home with only one full bathroom, you will see a dramatic rise in the market value of your home. While you should never compromise bedroom space for a bathroom, try sneaking one in dead space in the home. Scott managed to fit in a 3-piece bathroom under a staircase the width of the room measured just 44 inches. As an added tip, use glass for the shower to make the bathroom feel more spacious.
Kitchens are the single most important room in the home relating to valuation. The kitchen can make a significant difference in the value of your home. As such, it is crucial that you invest in having a modern, fresh anddesirable kitchen. Modern cabinetry, under cabinet lighting and new appliances will all significantly increase the value of your home on the market. To save on cost without compromising construction and desirability, look at options like Ikea cabinets as opposed to custom cabinetry.
#1 An Income Suite
No surprise, but the single biggest way to increase the value of your home is to build an income suite within the property. Whether this is converting yourbasement into a rental, or another floor in the home, an income property will increase your homes worth. The main reason for this is that it covers a portion, or sometimes all of your mortgage payments, and results in your home being cash flow positive which creates real wealth that can supplement your income.
Valuable Fraud Prevention Tips for Homebuyers and Homeowners: Part 1
March is Fraud Prevention Month. Canada Mortgage and Housing Corporation (CMHC) has consistently been a leader in the fight against mortgage fraud and offers the following tips to protect yourself against becoming a victim of mortgage fraud.
Misrepresentation of Information
Mortgage fraudoccurs when someone deliberately misrepresents information in order to obtain mortgage financing that would not have been granted if the truth had been known. This can include:
Misstating ones position or inflating ones income or length of service at their job;
Misstating employment status (ie. salaried/full time versus contract, part time, hourly or commission-based or self-employed);
Misrepresenting the amount and/or source of the down payment;
Purchasing a rental property and misrepresenting it as owner-occupied;
Not disclosing existing mortgage and/or debt obligations;
Misrepresenting property details or omitting information in order to Inflate the property value;
Adding co-borrowers who will not be residing in the home and do not intend to take responsibility for the mortgage.
Another common form of fraud is when a con artist convinces someone with good credit to act as astraw buyer.A straw buyer is someone who agrees to put his or her name on a mortgage application on behalf of another person. In return for their participation, straw buyers may be offered cash or promised high returns when the property is sold. Often, straw buyers are deceived into believing that they will not be responsible for the mortgage payments.
Consequences of Misrepresentation
Borrowers who misrepresent information and straw buyers who allow a property to be purchased in their name are committing mortgage fraud and will be responsible for any financial shortfall in the event of default. They may also be held criminally responsible for their misrepresentation.
If you suspect that you or someone you know has been the victim of mortgage fraud, please contact your local police department or The Canadian Anti-Fraud Centre.
Toll Free: 1-888-495-8501
Toll Free Fax: 1-888-654-9426
To find out more about mortgage fraud, visit the fraud prevention section of the Canadian Association of Accredited Mortgage Professionals (CAAMP) website athttp://mortgageconsumer.org/protect-yourself-from-real-estate-fraud.
For over 65 years, Canada Mortgage and Housing Corporation (CMHC) has been Canadas national housing agency, and a source of objective, reliable housing information.