Welcome to the personal VERICO Website of Vince Salvino, Mortgage Broker with VERICO The Financial Forum Ltd. Please browse around and contact me to get started or with any questions you may have.
Use my years of experience to make your mortgage process stress free. I am available at any time convenient to you and simplify the entire process to you. It is my belief that each client presents a unique challenge, has unique needs and therefore requires a unique approach. I will discuss your needs and goals at the beginning and find not only a solution, but a process that works for you. Of course, I welcome and appreciate any referrals! Enjoy.
Is a Re-Finance Worth it For You? See Here.
How to Check if Re-Financing Today Will Save or Cost You Money
Depending on your current interest rate, you may be thinking of looking into a re-finance to take advantage of todays low rates. Of course, as you probably know it isnt just as easy as switching your mortgage out for a lower rate, there are several costs and factors you need to consider. Things such as penalty to break your mortgage and closing costs on a new mortgage are all determining factors in the decision to re-finance or not. Were going to show you how to break down the costs and make an educated decision. Of course, the below is only to give you a guideline and although fairly accurate, should not be used as a quote or promise of any kind. (Seems obvious but we have to write that, youd be surprised). Now that the legal mumbo-jumbo is out of the way, heres what you do:
Determine what your penalty is. Unless your mortgage is open, then there will be a penalty to pay it off early. If your mortgage is a variable rate, then you will be paying 3 months interest only which is a simple calculation.
Mortgage Balance x Interest Rate = A
A 12 = B
B x 3 = 3 months interest penalty.
$300,000 balance at 2.30% (300k x 2.30% = $6,900. $6,900 12 = $575 x 3 months = $1,725
If you are on a fixed rate then your penalty will be the greater of three months interest (above) or Interest Rate Differential (IRD). IRD is where the lender takes your current rate and puts it against the rate being offered for the term that most closely matches the time remaining on your mortgage term. So if you have 2 years left on your mortgage, they would use the 2 year term. The math for this is slightly more complicated.
Current Rate Reinvestment Rate = A
Mortgage Balance x A = B
B 365 x Number of days left to maturity = IRD Penalty.
Lets see an example using a mortgage balance of $300,000 with an interest rate of 3.19% with 2 years left on the term and a current 2 year rate of 2.29%. Remember, these numbers are for example purposes only.
Ex. 3.19% 2.29% = 0.90%. $300,000 x 0.90% = $2,700 365 x 730 = $5,399.81 IRD penalty
You can also take into consideration your pre-payment privileges on the balance.
So now that you are able to calculate your penalty all on your own, lets move to step two
Get an estimate of any closing costs you are likely to incur. For this example we will use the IRD results from above and assume our mortgage balance is $300,000 at 3.19%, we will also estimate the following:
Appraisal cost: $350
Legal Fees: $1,500
Penalty using IRD method: $5,399.81
Now that you know what it will cost you to break your mortgage and close a new one, its time to determine your potential savings on a new mortgage. Again, we will assume our balance is $300,000 with our current interest rate at 3.19% and our potential new rate being 2.64%.
Over the last two years remaining on your term, you would be paying roughly $16,500 of interest at the 3.19%
and on the first two years of your new mortgage at 2.64% you would be paying about $14,500 of interest, a savings of around $2,000. Or you can look at your existing payments of $1,449.14/month vs your new payments of $1,364.90 a savings of $84.24/month. Over two years $2,021.76. This of course does not outweigh the cost of breaking the mortgage and would therefore be better to wait until your penalty is lower. In the case where you are paying three months interest, then it would be worth it to re-finance.
Keep in mind you should always double check with your mortgage broker to be sure what the penalty is. In a lot of cases, they may be able to get you a discount on the penalty or help you avoid legal fees and appraisals costs. If you are thinking about re-financing to get your rate lowered, check in with us and well let you know where you stand. Hope this helps you understand your mortgage a little better.
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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.