June 21, 2018

Liberals Refuse To Hear Evidence Against Stress Test

Less than 1 week ago, I shared an article where the Conservative Party Deputy Shadow Minister MP  for Finance, Tom Kmiec, was looking into overturning B-20 and the stress test.  Apparently the Federal Government is declining the Conservative’s proposed subcommittee review of B-20 and this is the second time the proposal has been dismissed in a matter of weeks.  What is their motivation in refusing to even hear evidence on what impact their changes are having on Canadians?  Is it all about their fragile egos or possibly because they made a mistake?

“The new stress test is going to block up to 60,000 Canadians from being able to buy a home and about 100,000 Canadians will probably fail the stress test and won’t be approved to borrow from a federally-regulated lender and that will push them to the unregulated lenders. We know from a CIBC Capital Market report that 47% of all mortgages need to be refinanced in 2018. In the year they knew there would be so many people refinancing, they still imposed the stress test. That was irresponsible and unfair.  B-20 is harming Canadian families.”

Upon renewal of your mortgage if you continue with the same lender, you don’t need to re-qualify, you just sign the renewal agreement.  However, lenders are not going to be offering you the best rates on renewal because they know you are stuck between a rock and a hard place.  If you switch to a new lender, you have to re-qualify at the new stress test and they know the odds of you qualifying and potentially losing your business are less than 50%.  Banks used to send renewal notices at posted rates because they had a captive market until Mortgage Brokers came on the scene and offered better interest rates.

Given the escalating number of desperate families taking out private loans this year, we wish Kmiec’s proposal was given consideration rather than dismissed outright.  The result is we’re seeing is a lot of people getting refinances that would have previously qualified but now need to go to private lenders to retain their homes or face putting them up for sale, this has a dramatic impact on people’s lives.  It shouldn’t be government policy to force people out of their houses or be forced to pay 12% – 15% for a private mortgage to take care of their finances.  I really don’t know who is winning in this situation except maybe the Banks getting a higher return on their Mortgage portfolio!

Colleen Saunders is a 20 year veteran in the mortgage industry, serving Mississauga, Burlington, Oakville and Toronto and offering all mortgage related services such as 2nd mortgages, private mortgages and more.

To contact Colleen, please fill out the form on  www.mortgagesbycolleen.ca  or call 416-459-2406

Calgary MP vows to continue his fight for B20 review

Staying Positive In Challenging Times

I read a business associates’ blog the other day and it really spoke to me and was a great reminder that positivity brings positivity and vice versa.  Therefore, I am guest blogging a section of Louise Veres post.  For the full post, go to website below.

I recently read an article in the Oprah magazine where she interviewed three extraordinary thinkers: Stephen Colbert (one of the wisest and most wisecracking political minds), Salma Hayek (brilliant activist and actress) and Jordan Peele (film director). Each was asked what gives them hope, given the world we live in today. While each has their own views, their thoughts were surprisingly optimistic. I’ll let you read the full article if you are interested, but as a quick summary, Stephen’s message was to take the Really Long View – meaning, he goes back to his roots and faith to provide him with hope. Jordan Peele’s message is to Laugh, especially when you are Scared. And Salma Hayek’s message is to Trust in our Power to Change.

At the root of it all is a deep sense and knowing that even though things may be bad at this moment in time, it won’t last. Eventually things will get better. What I’ve learned is that there are constant ups and downs in life. Bad decisions and bad relationships happen that can leave you feeling disappointed and questioning whether you handled things as best as you could have. But every mistake is a chance to learn and grow. It’s also a chance to decide to do things differently.

There is a saying: What you give your attention to grows. And, I think that applies to how we view the world today. If we believe that it’s negative and constantly feed this with more negative energy, then that’s exactly what we will get back. How many times have you said or thought to yourself “How bad things are”? The more you do this, the more you actually reinforce this belief. The more we complain, the worse things get.

Life is a mirror. Whatever shows up for you is always a reflection of how you see yourself.

Colleen Saunders is a 20 year veteran in the mortgage industry, serving Mississauga, Burlington, Oakville and Toronto and offering all mortgage related services such as 2nd mortgages, private mortgages and more.

To contact Colleen, please fill out the form on  www.mortgagesbycolleen.ca  or call 416-459-2406

https://www.thecentreforleadingandliving.ca/blog/

What Is The Difference?

Borrowing money to enhance your personal wealth or education constitutes good debt or “constructive debt”.  A mortgage, RRSP loans and student loans fall into this category.  This type of debt enhances your lifestyle and career satisfaction.

Almost anyone can get a credit card whether it is solicited or unsolicited.  This type of debt is bad debt and considered “destructive debt.”  You can recognize it by applying the following four criteria:

  1. It is incurred for consumption purposes.  The money is borrowed to purchase goods or services, not for business, education or investing purposes
  2. It carries a high interest rate
  3. Servicing the debt requires a disproportionate share of household income.  It costs you more each month to meet the financing payments than you are comfortable with
  4. Interest on the debt is not tax deductible

In dealing with credit card debt, the number one rule is don’t have any and the number two rule is to pay off your balance every month.  If you do have to carry a balance, reduce your interest rate.  Credit card rates are typically approx. 20% and department store cards are over 30%.  One way to reduce your interest cost would be to obtain a home equity line of credit.  If secured on your property, the rate would be between 3.5-4% and would enable you to pay off the principal faster.

You could also look into the following credit cards, which offer lower rates:   MBNA TrueLine MasterCard, Capital One Fusion Platinum MasterCard and Capital One SmartLine Platinum MasterCard.  There are other credit cards available, just make sure you check the fine print.

If you would to discuss some options available, I offer a complimentary, confidential financial assessment.

Colleen Saunders is a 20 year veteran in the mortgage industry, serving Mississauga, Burlington, Oakville and Toronto and offering all mortgage related services such as 2nd mortgages, private mortgages and more.

To contact Colleen, please fill out the form on  www.mortgagesbycolleen.ca  or call 416-459-2406

The Stigma Attached To 2nd Mortgages

I had a very interesting conversation with a client.  She happened to overhear 2 people at work openly discussing obtaining a 2nd mortgage.  She was telling me that as a child, she remembered her parents discussing friends that had to get 2nd mortgages and her parents being very judgemental.  Comments like “how could they get so far behind in their payments” or “they must be horrible money managers” that they would need to have to get a 2nd mortgage.

How many of us still hold onto these limiting beliefs that we would rather suffer through financial difficulties and just keep going further into the deep debt hole due to the embarrassment of getting a 2nd mortgage and worrying about what people would say.   The other option would be to clean up our debts or pay for our children’s education or do necessary home renovations by getting a 2nd mortgage.  There are many reasons why are finances could suffer.  It could be illness, job loss, spending just getting out of control or just the high cost of living.  What is more important, taking care of our financial house or being influenced by what other people say.

I have worked with many people to help them make informed decisions on how to move forward with their finances.  It is hard to know how to proceed without having the various options available to you on whether you should refinance your mortgage, get a 2nd mortgage, potentially sell your home or even considering bankruptcy or it may be as simple as doing a detailed budget.

If I can help you with an unbiased confidential discussion, please call me.

Colleen Saunders is a 20 year veteran in the mortgage industry, serving Mississauga, Burlington, Oakville and Toronto and offering all mortgage related services such as 2nd mortgages, private mortgages and more.

To contact Colleen, please fill out the form on  www.mortgagesbycolleen.ca  or call 416-459-2406

Bequeathing Money To Family Out Of Country

This is a very complicated topic but one that needs consideration if you intend to bequeath money to anyone overseas or in the USA.  You also need to plan your estate knowing that possibly a family member may one day relocate to another county or the USA.

It is very challenging to navigate the system of international estate and tax laws.  There are law firms that specialize in cross-border tax and estate-planning assistance and are aware that each country has its own set of tax and compliance obligations.  Apparently it’s not as difficult as it seems but does require a pro-active approach, think globally and act locally.

You need to consider the Canadian tax consequences and administration of those assets, as well as the foreign.  Seek the right help before developing an estate and tax planning strategy.  Some countries don’t have inheritance, gift or estate taxes, while others – notably the United States – maintain tax treaties with Canada designed to prevent double taxation.

The general concept is, if the tax has been paid in one country already, then tax should not be paid in the other country on that same source of income.

General advice: If you have family members in the EU, before you write someone into your will, find out what the implications are.  For more detailed info, refer to the article below.

Colleen Saunders is a 25 year veteran in the mortgage industry serving Oakville, Burlington, Mississauga and Toronto and offering all mortgage related services such as 1st & 2nd mortgages, private mortgages and more.

To contact Colleen, please fill out the form on  www.mortgagesbycolleen.ca  or call 416-459-2406

https://www.theglobeandmail.com/globe-investor/globe-wealth/the-perils-of-bequeathing-money-to-family-overseas/article38319064/?cmpid=rss1