It PAYS to shop around.
Many Canadian homeowners pay too much for their homes because they are not getting the best mortgage financing available in the market.
The mortgage process can be intimidating for homeowners, and some financial institutions don't make the process any easier.
But I’m here to help!
I’m a VERICO Mortgage Advisor and I’m an independent, unbiased, expert, here to help you move into a home you love.
I have access to mortgage products from over forty lenders at my fingertips and I work with you to determine the best product that will fit your immediate financial needs and future goals.
VERICO mortgage specialists are Canada’s Trusted Experts who will be with you through the life of your mortgage.
I save you money by sourcing the best products at the best rates – not only on your first mortgage but through every subsequent renewal. So whether you're buying a home, renewing your mortgage, refinancing, renovating, investing, or consolidating your debts — I’m the VERICO Mortgage Advisor who can help you get the right financing, from the right lender, at the right rate.
How much?!?! Mortgage pre-payment penalties explained.
If you were hoping the Canadian government had introduced a new law standardizing mortgage penalties, youll be sad to learn no changes yet. Rumours swirl that something has to or will be done in regards to this issues. But, until that time were stuck with what we have. So, it is in your best interest to understand how pre-payment penalties work.
Youll be shocked to know that the average Canadian breaks their mortgages every 3.5 years, and the most common term people take is 5 years. Its easy to see why understanding mortgage penalties can end up saving you thousands. Of course, there are some simple strategies to avoid a penalty:
Wait until your maturity date to refinance, buy and sell, or switch lenders.
Porting Most mortgages include a portability features that essentially allows you to transfer your mortgage to a new property.
Early Renewal Some lenders will allow you to renew up to 6 months early without penalty.
However, when these situations dont line up, or arent available, clients are forced to pay what sometimes can be a massive mortgage penalty. For example, if you started a new mortgage exactly one year ago when rates were around 2.99% for a 5 year fixed closed term and you wanted to pay out your loan in full, here are some numbers to consider:
BMO - $4,640.00
MCAP - $2,167.00
These calculations can be done at home if you want to test your individual mortgage. Each financial institution is now required to disclose a pre-payment calculator or formula on their websites to allow Canadians to calculate their own penalty.
So, youre probably wondering how these penalties are calculated? Well its a method of two formulas, Interest Rate Differential (IRD), or 3 Months Interest. With a Variable Rate Mortgage, it is always 3 months interest. If you have a fixed mortgage, its the IRD or 3-Months Interest and it always depends on which is greater. I should note that No Frills Mortgages, or super low rate mortgages can sometimes have completely different ways of calculating a penalty. Beware of what youre signing!
IRD What it means..
Interest rate differential is the difference of your current mortgage rate and what the lender could offer in todays current market. For example, if you have 4 years left on your mortgage, the lender will compare their rate to what their current 4-year rate is.
This calculation differs between lenders in regards to how they determine what rates to compare. Banks have posted and discounted rates. If you review any mortgage documents from the Big 6 Banks, it shows you the discount offered from the posted rate.
Right now, Scotabank has a 5 year rate of 4.79%, however, you could walk in there today and get 3.09% on the same 5 year term. But, when they go to calculate the penalty, dont think they wont consider the original discount. This is huge when picking your lender, especially if you know you may need to break your mortgage.
Other lenders, especially those available through the broker channel, compare rates at face value. Meaning, the discount rate is compared to the discount rate. That is what you saw MCAP (above) with the lowest mortgage penalty.
In essence, when selecting a mortgage lender, be sure to consider all your options. It could end up saving you thousands.
Mortgage Agent in Kingston, Ontario, License #M13000201
Stress Test Best Practices Tool Kit
With the new Office of the Superintendent of Financial Institutions stress test rules firmly in place since January, Canadian homebuyers have learned they need to arm themselves with practical information on how they can ensure they are stress-test ready.
The following is a guide and best practices tool kit for those about to embark on securing their new or next mortgage:
Make a financial plan
Any time a big purchase is at stake, laying out a financial plan is always the best first step to take. By creating a plan, home buyers can protect themselves from increased interest rates and ensure they are staying on budget.
Have a contingency fund
Without question and now more than ever, home buyers need to establish contingency funds. Its incredibly important to have funds set aside when unexpected costs such as property repairs arise. An established contingency fund also looks good to financial lenders.
Pay off debts and increase downpayment
The most important tool in the Best Practices Tool Kit is to pay off debts as quickly as possible and maximize your down payment. If you already have a mortgage, increase the frequency of payments by taking advantage of what the financial institution offers such as accelerated bi-weekly payments.
Broaden search parameters
Although you may have an ideal neighbourhood in mind, it is important to also consider broadening those search parameters. Often there are homes in other neighborhoods that could be a perfect choice if you are willing to commute a little longer.
Im here to help you
I can help you to navigate confusion surrounding the stress test. Ultimately, being stress test ready means being ready for future increases in rate so that you can afford your next home comfortably on your budget.
Preventing Falls on Stairs
Accessible housing refers to homes that are designed or modified to enable independent living for all residents, including seniors or persons with disabilities. Accessibility can be achieved through architectural design and also by integrating accessibility features, such as lowered light switches, grab bars, walk-in bathtubs, lowered shelves and cupboards, modified furniture or by installing electronic devices in the home.
Stairs in the home can be dangerous and can be a barrier to accessibility unless they are designed or modified to reduce the risk of falls. If residents have limited mobility, it may be necessary to install ramps, home elevators or stairlifts to make the home safe and accessible.
A high percentage of Canadians who visit hospitals after a fall on or from stairs or steps in their homes are seniors (men and women 65 years or older). When seniors fall, the consequences can be severe and long-lasting.
Most falls on stairs can be prevented. Prevention starts by keeping in mind that there are risks in using stairs. Good planning and simple strategies can help prevent falls and injuries.
Click here for more information https://www.cmhc-schl.gc.ca/odpub/pdf/63637.pdf?fr=1441901329905