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The-Mortgage-Gal

Mortgage pros fight Ottawa

New Consumer Advocacy Campaign Announced

The Mortgage Professionals Canada launched a new consumer advocacy campaign including a website, www.tellyourmp.ca, on April 25.

The purpose of the website is to educate members of Parliament about the negative impact that changes to mortgage insurance and eligibility have had on homeowners or potential homeowners.

The association has been lobbying the government and is asking middle class Canadians to voice their opinions by letting them know how they have been impacted by the changes.

"Our members are working with and seeing directly that many Canadians are frustrated by the impacts of these changes and are looking at ways to reach out to the government directly," said Paul Taylor, president and CEO, Mortgage Professionals Canada.

"Our goal with this grassroots campaign is to make it incredibly easy for Canadians who have been disadvantaged by the changes to send a message to their local MP to build support for affordable homeownership."

Mortgage Professionals Canada has been encouraging those impacted by the mortgage changes to email a letter to their MP by visiting www.tellyourmp.ca.

Members of the association have been lobbying local MPs about the negative impact the changes are having on housing activity in Canada. Additional  costs are impacting the Canadian middle class through higher interest rates and reduced purchasing power.

Many homeowners are paying thousands more in interest costs and many first time buyers or those with smaller down payments are unable to qualify for a mortgage that will allow them to buy a home in their local. 

Because of these changes and the impacts to real people, the association is calling for the government to make some reasonable, common-sense adjustments to the recent changes. 

The association gave the government recommendations on meeting  their goals while softening the negative impacts on Canadian homeowners and buyers.

About Mortgage Professionals Canada

Mortgage Professionals Canada is an association representing the mortgage industry. It represents approximately 11,500 individuals and more than 1,000 companies, including lenders, insurers, mortgage brokerages and industry service providers. 

"Our members make up the largest and most respected network of mortgage professionals in the country whose interests we represent to government, regulators, media and consumers."

The association is dedicated to maintaining a high standard of industry ethics, best practices and consumer protection.

This body represents the mortgage broker channel which originates 33 per cent of all mortgages in Canada, 50 per cent of first time homebuyers and represents about $80 billion dollars in annual economic activity. 

The strong membership and diversification of members allows the association to address issues impacting all aspects of mortgage origination in Canada.

If you have been impacted by the changes, please visit the website above.

To be continued.



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Should you buy or rent?

Should You Buy a Home or Keep on Renting?

Buying a home is one of the biggest emotional and financial decisions you’ll ever make, so prepare yourself to make a knowledgeable decision.

Although buying a home almost always seems like a great idea, it is important to understand what home ownership involves.

Of course, being a homeowner is something to be proud of but it also means having to invest money, time and energy and take on added responsibilities. So, before you decide to buy a home, make sure you’re ready.

Here are some things to consider:

  • Financial Security - If housing prices rise, your home can provide you with some financial security due to capital appreciation.
  • Stability - Having a place of your own.
  • Financial Stress - Coming up with the down payment, meeting regular mortgage payments and other ongoing costs will tie up a lot of your cash, and can put considerable stress on your finances.
  • Maintenance -  Keeping your home in good shape requires time and money.
  • Responsibility - You alone are responsible for payments, repairs and maintenance.
  • Flexibility - You can decorate or renovate your home to meet your own family’s personal tastes and needs.

Now that you have an idea of what to expect, take out a notepad and list the advantages and disadvantages of renting or buying a home.

This list will help you weigh in the pros and cons of renting and buying and help you determine if home ownership is right for you. 



Rebuilding bad credit rating

What You Can Do if Your Credit Takes a Beating

Sometimes bad things happen to good people. Credit problems can be caused by many events. 

I have had clients who have had a sudden job loss or a serious illness with a child. When these things happen, it's hard to focus on paying your bills on time.

Just because you had some trouble with credit at a certain time doesn't mean you won't ever be able to get a mortgage. If you have had a bankruptcy or a consumer proposal, you will have to wait two to three years from the date of discharge or in the case of a consumer proposal the payoff date, before you can apply for a high ratio mortgage.

What if you have a mortgage already? Sometime homeowners get behind on their bills because of an unexpected loss of income or life event and they start to accumulate balances on their credit cards and lines of credits. 

It is really important to keep the minimum payments up to date so your credit does not suffer. If possible look at refinancing your first mortgage to repay the debt. Sometimes the credit is so far behind that a private second mortgage is required to payout all of the debt.

Fortunately, with the increases in values of homes this is sometimes not too hard to accomplish.

What if you want to buy a home and have bad credit? The best option is to pay out the debt and start to re-build again. If you have an existing home, you may consider selling, paying out all or most of your debt but leaving enough to have a healthy downpayment of at least 35 per cent if the credit is already bruised. 

Sometimes, I have started my clients in a private mortgage with 25-35 per cent equity because the credit was so far beyond repair. After repairing credit for a year and the payment of the private mortgage the homebuyers are ready to move to a B type lender with a little bit better interest rate and a small or no fee mortgage. 

Most credit will take two to three years to rebuild and at that time the clients' mortgage can be transferred to a regular financial institution.





Should you renovate?

Buying a home is one of the largest investments we will make and we often ponder whether to sell our home and upgrade or if we should renovate instead. 

Buying a home is primarily to provide shelter for ourselves and family, but it is also a huge investment, which will appreciate over time.

Our homes' values are not only impacted by their locations, but also the market and the health of the economy. The last few years most areas in Canada have seen significant housing increases especially Vancouver and Toronto. It is usually expected that over 20 years, a home will appreciate significantly. 

As the Baby Boomers age, it is anticipated that many will sell their large homes and downsize into smaller homes or strata units and invest the remaining proceeds into retirement investments.

Some of those who will retire in the next few years, plan on renovating to their homes before putting them up for sale. While renovations should increase the value of a home, it is advisable to be cautious in what kind of improvements will see the best increase in value. 

Here are a few insights for you to keep in mind if you plan to renovate.

Bathrooms and Kitchens

Bathrooms and kitchens are often renovated and usually the money invested is recouped in the increased value. Upgrading lighting and fixtures can have a significant impact with relatively modest expenses. Anything more than that require a greater out lay of money.

If the bathroom upgrades include whirl pool baths or soaker tubs then costs will increase. Similar increases can be seen in the kitchen when the upgrades include new appliances, upgrading counter tops and cabinets.  Costs can be prohibitive.

Basements

Another common renovation project is the basement, which will increase the living area. This is a strong selling feature; converting an unfinished basement into a usable space will usually fetch extra money in a sale.

Basements are useful for families with teenagers to provide a separate space or they can be converted into a suite with a separate entrance to accommodate tenants for added income. Suites are also useful for in-laws who choose to move in with their children later in life. Either use provides good value for the money spent.

Poor Renovation choices

Some renovations projects will provide good resale value while other renovations could lessen the value received or hinder a sale. At the top of the list is the addition of a pool. 

While many people love the idea of having their own pool, this is a feature that families with young children will avoid. Not only are pools dangerous to young children, they also require a lot of maintenance and cleaning, which makes them unpopular with some buyers.

Another poor choice is converting a garage into living space. While it may increase the square footage of a home, many people like the idea of having a place to park their vehicle out of the weather. Garages also provide a lot of storage and so potential buyers may see this as a loss.

Upkeep

Finally, while these major investments may not increase the visual appeal of your home to a potential buyer, they may still increase the value. It is important to keep the major items in good repair.These include the roof as well as heating and cooling systems. 

These are items that stand out in a home inspection, which most potential buyers will obtain. These big ticket items if in disrepair can cause the buyer to lose money in a sale or the sale itself.



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About the Author

Laurie Baird is a Mortgage Broker with Verico Complete Mortgage Services. She has been in the mortgage business since 1991 and a broker since 1997. 

As a Mortgage Broker she is able to match her clients' needs with a lender who will provide them with competitive rates and products.

Laurie has a Bachelor of Education degree from UBC.

Contact Laurie at 250-862-1806 or visit:
http://www.okanaganmortgages.com

Visit Laurie's blog at: https://www.okanaganmortgages.com/blog



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The views expressed are strictly those of the author and not necessarily those of Castanet. Castanet does not warrant the contents.

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