August 16, 2018

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

What About Your Banking?

Over the past 6 months, I have had a number of clients referred that are just too busy or overwhelmed with taking care of their day to day finances.  Generally speaking, they don’t understand the banking system or how to set up systems to take care of their bill payments.  The end result is this effects their credit score and costs them more money to arrange their mortgage financing.

A big part of the problem is they just don’t have the time to learn how to make the systems work for them, other priorities take precedent over having to learn something new, again.  We are continually having to learn new computer systems and we are overwhelmed by having to digest something else!

Here are some simple suggestions:

  • Make time twice a month to sit down with your banking to pay your bills and reconcile what monies are coming in and what is going out
  • Have your deposits (i.e. pensions) put on automatic deposits and it will save you time instead of having to personally deposit these cheques
  • Put your utilities and other payments on automatic withdrawal and this will ensure that these bills are paid on time
  • Go to your bank and ask them to explain what it is that you don’t understand about the banking system
  • Take a hard look at what it is costing you in bank charges (i.e. NSF fees) by not being in control of your banking balances.

If I can clarify anything for you, please call me and take advantage of my many years working within the banking system!

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

Is Mortgage Protection Insurance A Good Idea?

Mortgage protection insurance is a form of life insurance that covers your mortgage debt if you die or become disabled.  It is a very popular sell by the banks because you can just add the premium to your mortgage payment.

So you ask, isn’t this a good thing?  Well most people in the industry would say no for the following reasons:

  1. As your mortgage decreases, so does your payout because it only covers the outstanding mortgage balance however your insurance premiums remain the same
  2. The monies go directly to the lending institution and not to you to decide how you want to disburse the monies.  Maybe paying off the mortgage is not the best decision
  3. In case of disability, the policy will generally cover your monthly mortgage payments until the debt is finished but nothing else
  4. There is no medical, unless you disclose a pre-existing condition and your claim could be denied if they find something that violates the insurance contract

A better option would be life insurance.  Your payout will remain the same through the term of your policy and you can allocate the funds as you wish.  Generally speaking, life insurance is less expensive than mortgage insurance.

Always keep in mind that the banking community is under huge pressure to cross sell services and they benefit quite nicely by selling mortgage insurance whether it is in your best interest or not!

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

Steps To Help You Save Towards Purchasing A Home

Possibly you don’t own a home but you would now like to start saving towards a down payment to purchase a home.  The first thing you need to do is eliminate your debts to start your savings.

Here are some suggestions to take control of your debts:

  1. Assess Your Situation:  Take an honest look at what you owe, the interest rates and the terms of repayment and document everything
  2. Set Goals:  Take some time to work out your short, medium and long-term financial goals i.e. in 1 year you may want to pay off all your debts, in 2 years you may want to buy a car, in 3 years you may want to purchase a house.  Without solid goals, you won’t be motivated to pay off your debts
  3. Create a Household Budget:  Once you have determined how much you owe, you need to identify all your monthly expenditures.  Create a household budget to determine how much you have to spend on basic living costs and subtract that from your monthly income.  Then see what’s left over to pay off your debts
  4. Curb Your Spending:  Determine where you have been wasting money and what changes you could make to amp up your debt repayment.  Maybe you don’t have to buy your lunch or you could take advantage of free coffee at work plus you could put all your change in a jar, then use it to pay down your debts
  5. Stow Your Credit Cards:  Since it was your credit cards that got you into trouble in the first place, you need to stop using them.  You must cut them up except maybe one for emergencies.  Remove the temptation
  6. Learn How To Say No:  Creating a budget is the easy part, sticking to it is something else.  Set yourself a challenge for example, go 30, then 60 then 90 days without shopping.  You have to learn how to say no and stick to your plan because it is so easy to fall back into your old spending habits
  7. Snowball Your Debt Payments:  Tackle your highest interest rate debt first because this is the one that is costing you the most.  You could also pay off the smallest debt first to give you some success to stay motivated.  Once the small debts are gone, you can use that money to snowball the payments on the other cards
  8. Find Extra Sources Of Income:  In order to repay debt as fast as possible, consider other sources of income.  Take a look at your assets to see if you can part with them.  Or, you could look at getting a second job

I offer a totally confidential complimentary 45 minute Financial Consultation to provide you with alternatives and options available towards establishing your financial goals.

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