Strata Fee Increase & Lowering Your Payments

 

Strata Fee Increase & Lowering Your Payments

We’ve recently been informed by strata insurance companies in our local area, that people who are currently in stratas could be looking at a 30% – 100% Increase in the strata insurance. This will cause a increase in your strata fees.

If you are in a strata & are looking to consolodate or lower your mortgage payments to cover this, please give us a call!

 

 

B-Lenders & Private Mortgages

 

 

 

B-Lenders & Private Mortgages.

As Chilliwack Mortgages Brokers, we’ve decided to give you all an easy read on everything you need to know about B-lenders & Private Mortgages.

Most of us are vaguely aware of private mortgages, although B Lender Mortgages & Private Mortgages are the fastest growing segment in the Canadian mortgage industry, because they’re much easier to qualify for then the A-side.

 

 

The A side is getting tougher to qualify for now than at any time in recent memory. High prices in major cities, large mortgage requirements and a higher stress test, which can put qualification out of reach for homeowners who have had no concerns. This is where B-Lenders or Private Mortgages are needed to step in and help the homeowner get on track.

 

B Lenders are necessary, but all are very similar, watch out for lenders that add on High Fees.

 

4 most common cases when B lenders are needed to step in

 

  1. Consolidations – by doing a debt consolidation, it lifts the burden of debt. But also helps lift your credit score, which will get you back to the best rates on the markets.

 

  1. Stated Income – There are cutbacks on self employed lending for those who do not “claim” enough income. If you’re a self employed individual, the more you write off the less of a mortgage you will qualify for. Give short term capital while figuring out income.

 

  1. Construction Financing – Banks have tightened up on construction financing leaving fewer options.

 

  1. CRA Debt– Most Banks will not let you use a mortgage to pay off CRA debt. If you have CRA Debt, you must pay that off before applying for your mortgage.

 

 

Opportunity Arises to go from Renter to Homeowner – Chilliwack BC

 

As a Chilliwack mortgage broker, we tend to experience similar seasonal changes as our local real estate partners do, with some exceptions. Purchase season will often slow down around Christmas, picking back up in February and continue snowballing until it reaches it’s peak in the early summer weeks; however, this year appears to be drastically different than previous years. Rather than slowing down in mid July – mid August (often prime vacation time), the pace of home buying/selling doesn’t seem to be slowing down anytime soon. Therefore, us being Chilliwack mortgage brokers, we took it upon ourselves to do a little digging and come up with some sort of conclusion as to why this may be.

 

3     things became clear to us:

1)      Home values have decreased as much as 10% since 2018 and as of recent, this decrease in home value has reached as much as 19.49%.

2)      Interest rates have significantly dropped compared to last year as much as 0.90%

3)      The Bank of Canada recently lowered its stress test rate from 5.34% – 5.19%

To some, the change in Chilliwack’s real estate might not seem to be hugely different, to others this change can take someone from a full-time renter to a first-time homeowner.

Below is a comparison to show Chilliwacks new interest rates/housing costs, and how these changes have increased purchasing power for many Canadians.

 

August 2018

Mortgage amount = $500,000

Interest rate (5 year fixed) = 3.79%

Amortization = 30 years

Monthly mortgage payment = $2318.53

 

August 2019

Mortgage amount = $450,000

Interest rate (5 year fixed) = 2.89%

Amortization = 30 years

Monthly mortgage payment = $1866.48

 

That is a $452.05 difference in monthly mortgage payments!

 

 

Canadians Reach Highest Debt Service Levels to Date

Chilliwack, BC – Alarming statistics were released stating that Canadians are paying the highest percentage of their income, towards debt. Although the headline may seem alarming our Chilliwack mortgage brokers are advising that it’s in fact not as frightening as it sounds.

Yes, Canadians will have less disposable income left to spend on life outside of servicing their debts. The difference is that a significant amount of that debt payment is going towards principal pay-down rather than interest. In the early 90’s over 95% of debt payments went towards interest, whereas now 50% of our debt payments are going towards interest – that’s a 45% decrease in the percentage of that payment going towards interest while the remaining 50% is going directly towards paying down the principal amount on said debt owed.

The percentage of our income has barely budged for servicing mortgage debt, in fact majority of the increase in debt has been obtained outside of residential mortgages.

When talking to consumers, it appears that the mortgage payment itself isn’t core of financial stress for home–owners. The culprit causing this overwhelming amount of debt really derives from car loans, credit cards and lines of credit.

We think it would be beneficial for the government to consider regulating these industries in the same way they regulate mortgage financing.

For more information check out our Facebook page for a video of our founding partner and licensed mortgage expert, Jordi Browne – as he sheds some light on the topic.

 

Elections & Changes For Canadian Home Buyers

With elections six months away, Canadian home buyers are hopeful for a solution to address the housing affordability issue and so are we. It’s undeniable that certain rule changes have made housing unaffordable for several home buyers across Canada, but these changes not only affect those trying to buy, they also affect Canadians who have been home owners for several years.

Often referred to as the “stress test”, home buyers and home owners are required to qualify for a mortgage on the greater of either: 2% above their contracted rate or the posted benchmark rate. This mortgage stress test drastically limits funds available to those trying to buy, refinance and even renew their homes. It is likely that our government will take action to hopefully make housing affordable again, we just don’t know how beneficial those changes will be to Canadians.

There are rumors of a proposed change that could cost Canadians an extra $40,000 of interest on the average $400,000 – here is our take on it.

Government Introduces a Real Blunder of a Program for Home Buyers’

Chilliwack, BC – Here are my thoughts regarding the governments offer of an interest free loan in exchange for a percentage of ownership in your home.

On January 17, 2017 the BC liberals introduced something similar called the BC Home Partnership Program. The program offered to match home buyers’ down-payment costs with an interest free loan for the first five years. When NDP took power back in March of 2018, they removed the program stating that,

            “When the program was first introduced, it was anticipated it would provide 42,000 loans over a three-year period, however, as of January 31, 2018, there were fewer than 3,000 loans approved.”

While the program sounded advantageous and enticing, popularity was minimal simply due to an unachievable list of requirements and restrictions. These restrictions filtered several prospective buyers wanting to part-take in the program. In addition, the return was not equivalent when comparing to the hoops Canadian home buyers needed to jump through. Furthermore, lenders reacted to the program by putting a repayment factor on the interest free loan that hindered the initial benefit of not having to make payments for the first five years.

Moving forward, I predict that we will have even fewer loans approved as the number of insured mortgages in addition to the CMHC incentive, would be capped using a formula (4X your annual income up to a max of $480,000). In simpler terms, Fraser Valley home buyers making $60,000 a year, would qualify for a $240,000 purchase (that really doesn’t get you a whole lot).

We’re not yet certain as to how this will be implemented, but if there is a repayment factor attached to the loan, it will have very little impact on helping Canadians get into the housing market.

At this point I would not be surprised if there is further action taken by CMHC, allowing for 30-year amortizations for those that have less than 20% down-payment. I personally think this is a terrible idea, sure your monthly payment might be a few dollars less, but it ultimately extends the life of the loan and increases interest over time.

Should they proceed with the extended amortization strategy, I would expect it to take place closer to elections in an attempt to try and leverage themselves.

If the government is concerned about helping Canadians get into the housing market, they should consider lowering the stress test rate.

For more information on the 2019 Federal Budget, visit: https://www.theglobeandmail.com/politics/article-federal-budget-2019-highlights-10-things-you-need-to-know/

Do you qualify to buy a home? Give our team to find out 604.615.1315

BC Budget Speculation, Changes for Home Buyers

Chilliwack BC, The BC budget is set to be released in just a few days and as always, there are speculators weighing in on the changes we’re expected to see and where exactly we expect funds to be allocated. Housing affordability is a topical subject of course, as we’ve seen the rise and fall of transactions over the last few years and the impact these rules and regulations have had on home buyers and even home owners. These changes may consist of altering home buying programs and mortgage products, along with tax benefits for seniors, pharmacare and job training. Here is a more detailed look at those predictions:

Longer Mortgage Amortizations: Re-introducing 30-year amortizations for those who have less than a 20% down-payment.

Home Buyers Plan: Increasing the RRSP withdraw from $25,000 to $35,000 for first time home buyers without penalties with the stipulation that all moneys are repaid within 15 years.

Tax Benefits for Seniors: Increasing withdraw flexibility from RRIF’s by raising the age requirement (currently 71 years of age) as Canadians seem to be living and working longer. Consideration to increase the income threshold for GIS has also been mentioned. As it stands, qualification is limited to a max of $18,240

Pharmacare: Potentially lower the cost of prescription drugs.

Job Training: Businesses have claimed to be struggling to find the right fit along with the appropriate skill set to fill job vacancies. This shortage is apparent in the tech area and other industries that require skilled trades. Proposal to expand tax credits that allow tax payers write off a portion of the cost that comes along with training programs and further education.

For more information regarding the speculation of the BC budget: https://globalnews.ca/news/5051109/federal-budget-2019-canada-preview/

The Truth Behind Best Interest Rates

Chilliwack, BC – When it comes to getting a mortgage for a home purchase, refinancing to consolidate debt or simply renewing your mortgage, most of us are interested in securing the best interest rate. You’ll often see websites such as rate hub, offer rates that beat just about anything you’ve been quoted by your bank or mortgage broker, but did you know that 4 out of 5 people do not qualify for the rate they saw advertised? That incredibly low interest rate you saw online, will likely come with a detailed list of restrictions.

Here are a few common mortgage scenarios and the percent you can expect to add onto that “best interest rate”.

 

The above figures are estimates and subject to change without notice E&O, O.A.C.

October Market Update

TSX UP 2.5%

DOW UP 4.33%

S&P 500 UP 2.22%

Happy Halloween everyone!

Hopefully you are slowly going through the candy you either bought, or are stealing from your children after they put in the hard work getting it ( excellent learning opportunity to show how taxes work).

The markets chose treat this month, and not a tootsie roll; they were giving out full size chocolate bars to everyone.  The Dow refuses to stay down amid another record breaking run. I had a lot of colleagues  calling for a crash by 20,000, but no one told the DOW as its well above 23,000. This rally has been powered by great earnings down south, as well as the proposed changes to the tax code that Donald Trump  is working on. If these tax cuts are passed look for confidence in the American Economy to sky rocket.

Also joining the record books is the TSX; Breaking through the 16,000 mark for the first time on the recovery of the energy sector and solid earnings from the banks.  While interest rates stayed the same it looks like the US is thinking of raising in December. This will depend largely who is appointed to be the new Fed Chair as well as if they want to stay the same course as Janet Yellen who in my mind did a fantastic job navigating the choppy waters. Shockingly the North American markets didn’t see any reaction to the chaos happening in Spain right now as the Catalonian government voted overwhelmingly to separate from Spain in an unrecognized vote of independence. Spain has chosen to not recognize these results and called in the army to handle the situation there. Spain is one of  Europe’s biggest economies, which Catalonia being the economic hub.  If they do end up doing a Brexit like move that might cause ripples in the Euro Zone.

As  always if you have any questions or concerns let me know!

Happy Halloween from my family to yours!

 

By Referral Mortgage Consultants*

“Click, Call, Chat – Award Winning Brokers”

Dave  604 897 2741 Jordi 604 615 1312
www.ChilliwackMortgageBroker.com

www.AbbotsfordsMortgageBroker.com

 www.BRMC.ca

 www.PeaceOfficeMortgageBroker.com

Connect with us on!
BRMC Facebook

BRMC Google review Chilliwack Office

BRMC Google review Abbotsford Office

BRMC Google review Mission Office 

http://www.linkedin.com/company/2410358

https://twitter.com/brmcmortgages

http://www.youtube.com/user/BRMCmortgages

We’re active on Facebook, Twitter, LinkedIn & YouTube. We really appreciate reviews! Good or Bad please let the world hear your voice! Connect with us for ongoing industry news items, contests & prizes.

*By Referral Mortgage Consultants – doing business as BRMC is: Verico Preferred Financing Inc / Verico Canadian 1st Mortgage Corp which have a co-brokering agreement and there is a common Mortgage relationship and are licensed with the Verico Dreyer Group. Mortgage ownership, that employees of both Mortgage companies may review, advise and help process the Mortgage files. That Verico Preferred Financing Inc & Verico Canadian 1st Mortgage Corp share the some expense and income from mortgages. Kim Langille Featured on thess site is an unlicensed mortgage assistant only, not a Mortgage Consultant. Jordi Browne featured on this site is the Mortgage Broker of record. “The Broker” is Jordi Browne. Jordi Browne also holds a Life Insurance License and represents Verico Canadian 1st Mortgage Corp. Dave Browne featured on this site has a Life Insurance License too but is an independent agent– Jordi and Dave Browne co-broker life insurance files and share expenses, all income retained by Verico Canadian 1st Mortgage Corp. 

Volatility

As an investment advisor it’s my job to know what’s going not only in the stock market but also news around the world that might cause ripples through a client portfolio. The first three hours of my day is listening to podcasts on top events, reading the articles and watching the market to see what the pulse of the portfolios my clients invested in are doing.  One of the biggest pieces of news is the constant predictions of doom and gloom in the market for whatever reason- people are much more likely to react to news predicting a stock market correction than their portfolio making another 3 % last month.

The recent election of Donald Trump as president has created a lot of volatility in the short term but also buying opportunities. Take a look at GM, Nordstrom’s, and Ford after he was elected for this volatility. President Trump tweeted out negative news for these companies and their stock value took a fast sharp hit in one day, only to regain its value a few days later. This can be stressful for the average investor; and may result in wanting to try and sell on bad news.

The stock market is unique in that when things get cheaper ( they go on sale) people freak out- if you were to walk into a car dealership and they said cars were 10% lower today then yesterday for the same car wouldn’t you want to buy one today instead of yesterday?  With all this volatility it’s more and more important to stay in contact with your financial advisor to explain why things are up or down and what this means for your portfolio. At Peak Securities my goal is to not only earn a steady return but to educate and inform my clients. If there is a problem in the market you will know what is going on and what the next steps are. With President Trump on twitter as well as news occurring all over the globe the prospects for volatility are a lot higher now than ten years ago, these spikes are usually short lived and having a long term strategy to take advantage of these spikes is a key to success.

If you have any questions or would like a review of your current portfolio feel free to contact me at testabrooks@peakgroup or 778-325-1373 / 780-709-1373

By Referral Mortgage Consultants*

“Click, Call, Chat – Award Winning Brokers”

Dave  604 897 2741 Jordi 604 615 1312
www.ChilliwackMortgageBroker.com

www.AbbotsfordsMortgageBroker.com

 www.BRMC.ca

 www.PeaceOfficeMortgageBroker.com

Connect with us on!
BRMC Facebook

BRMC Google review Chilliwack Office

BRMC Google review Abbotsford Office

BRMC Google review Mission Office 

http://www.linkedin.com/company/2410358

https://twitter.com/brmcmortgages

http://www.youtube.com/user/BRMCmortgages

We’re active on Facebook, Twitter, LinkedIn & YouTube. We really appreciate reviews! Good or Bad please let the world hear your voice! Connect with us for ongoing industry news items, contests & prizes.

*By Referral Mortgage Consultants – doing business as BRMC is: Verico Preferred Financing Inc / Verico Canadian 1st Mortgage Corp which have a co-brokering agreement and there is a common Mortgage relationship and are licensed with the Verico Dreyer Group. Mortgage ownership, that employees of both Mortgage companies may review, advise and help process the Mortgage files. That Verico Preferred Financing Inc & Verico Canadian 1st Mortgage Corp share the some expense and income from mortgages. Kim Langille Featured on thess site is an unlicensed mortgage assistant only, not a Mortgage Consultant. Jordi Browne featured on this site is the Mortgage Broker of record. “The Broker” is Jordi Browne. Jordi Browne also holds a Life Insurance License and represents Verico Canadian 1st Mortgage Corp. Dave Browne featured on this site has a Life Insurance License too but is an independent agent– Jordi and Dave Browne co-broker life insurance files and share expenses, all income retained by Verico Canadian 1st Mortgage Corp.