June 21, 2018

Window Of Opportunity

Dear friends, I am writing to give you a heads up of the impact of changes coming to the mortgage industry.  Are you considering refinancing your mortgage?  Come January 1, 2018, that window of opportunity will be closed!!  Let me explain the impact this will have on you, your family and friends.

The most impactful change is to the refinance market.  Let’s say you want to consolidate your mortgage and other debts into 1 mortgage, take equity out of your home for investment, home renovations or purchase another property.  Currently, you would qualify on the rate you receive but with the new legislation, you will have to pass the stress test and you will have to qualify at the benchmark rate, which is currently 4.89% or 2% above the interest rate you receive, whichever is higher.  (For example, if your 5 year rate is 3.09% + 2% = 5.09%).  What does this mean?  It means this will greatly reduce how much equity you can take out of your home.

Right now, if you were to purchase a home with a minimum of 20% down payment, your debt servicing would be calculated on the 5 year interest rate you receive.  Come January 1, 2018, you will have to qualify in the same manner as above.  This means that the family’s purchasing power will decrease substantially.  Just to give you an idea, a purchase price of around $720,000 would be reduced to around $570,000 which is approximately $150,000 reduced buying power (these numbers are not exact due to variations in property taxes, condo fees, other debts, etc.)

If you think you may need to take equity out of your home for whatever purpose, do it now before the January 1st deadline.  Please call me if I can be of any assistance to you, your family or friends!

Colleen Saunders is a 20 year veteran in the mortgage industry, serving Oakville, Mississauga, Burlington 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

Mortgages Are Incredibly Personal!

Mortgages are incredibly personal and it is important to do your research and know what suits your income level and your lifestyle.  You need to know your pre-payment options with the goal to be able to exercise these options to reduce your mortgage.

Within the mortgage industry, there are 2 groups of people that determine what interest term they will select.  Group 1 takes a keen interest in following what is happening in the industry, the economy, the bond market, the world market and it’s impact on our economy.  The second group selects what they think is the right term but have other priorities in life and deal with i.e. the rate renewal on an as needed basis.

I have clients that only take variable rate mortgages but make their payments based on 5 year interest rates and are able to pay a substantial amount off the principal, hence they are always ahead of the game and rates don’t become the most important factor.

I also have clients that feel the most important aspect is to know exactly what they will be paying for the next 5-10 years so they can effectively plan and budget.  You need to know your capability to be able to make the payments.  There is no point in making higher payments or pre-payments on your mortgage if you have to incur outside debts to pay down your mortgage.

Whatever your needs or motivation, obtain all the pertinent information to help you decide which mortgage term is right for you and your family.  Obtain all the options from someone you trust and respect so you can make an informed decision.

Colleen Saunders is a 20 year veteran in the mortgage industry, serving Oakville, Mississauga, Burlington 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

Owning A Home Is Still An Option!

As a Independent Mortgage Agent, I have had the pleasure of working with young couples to arrange the mortgage financing on their home purchases.  With all the negative information and the ridiculous home prices today, it makes you wonder will the Gen X and the Millennials ever be able to purchase a home?  Are we moving into a generation of raising our families from rental premises?  I don’t think so, I think there are still options and we just need to explore them together.

I can help you with your mortgage and remove all the wonder, worry, concern and stress and give you the direction you need to move forward.  How much can you afford?  What about the down payment, how much do you need and how will you save the money?

With over 20 years experience as a Independent Mortgage Agent coupled with my previous banking experience, I can offer you a ton of experience and expertise in this difficult housing market.   The added bonus, because I am totally independent, I have access to many financial institutions and there is no cost for my service as the lender pays me a referral fee for placing the business with them.  I can help you with anything financial.  We can discuss budgeting, how to save for your down payment, RRSP’s and the benefits, how much income you need to qualify and what purchase price should be that doesn’t put you into the ‘house rich but cash poor category’.

My gift to you is helping you understand the options available and to help you attain them!

Colleen Saunders is a 20 year veteran in the mortgage industry, serving Oakville, Mississauga, Burlington 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

Should Fines Should Double For Realtors Breaking Rules?

The Ontario Real Estate Association (OREA) says fines for rule-breaking realtors should be double so the potential penalties keep pace with rising housing market.

Last year, realtors found guilty of violating the code of ethics faced an average fine of less than $6,000 from the Real Estate Council of Ontario (RECO), the industry regulator.  The existing penalties were set when the average resale Ontario home cost $211,000 compared to $619,000 today.

OREA recommended fines be doubled for violating the Real Estate and Business Brokers Act (REBBA) Code of Ethics. That would put the maximum penalty for salespeople at $50,000, while brokers and brokerages would face fines of up to $100,000.

The discussion paper is meant to elicit feedback from OREA’s 70,000 members to the Ontario Liberal government’s review of the real estate act.  New rules are expected in the fall for agents who represent both a buyer and seller in a single transaction.

In addition to the higher fines, OREA says RECO needs to be able to order realtors to return profits made through breaches of the act.  “Fines may not cover the entire fee earned as a result of unethical activity. In other words, even under a system of higher fines registrants could still profit from unethical behaviour,” said the OREA paper.

It also wants RECO to have the authority to revoke or suspend a realtor’s registration to practise, a finding that can be overturned by an appeals tribunal under the current system.

In an emailed statement from RECO registrar Joseph Richer, the regulator also supports higher fines and the ability to make realtors repay profits achieved by unethical practices.  It also agrees with the need to have the authority to revoke registrations.

There were 70,284 registered realtors in Ontario in 2014 and 73,751 in 2015.  But that number shot up to 78,870 last year, according to OREA.  Of those, 48,117 were real estate salespeople.

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

Article:  https://www.thestar.com/business/2017/08/22/rule-breaking-realtors-should-face-stiffer-penalties-says-orea.html

Watch Out, Tighter Mortgage Lending May Still Be Coming

When will it stop!  After all the changes implemented to cool the housing market and reduce consumer debt, more tightening may still be coming.  Wouldn’t you think that the Ministry of Finance and OSFI would wait to see the impact before implementing more changes?

The recent changes targeted insured mortgages.  Now the Bank of Canada has identified the uninsured mortgage market as the next place to make tougher regulations.

The first measure that is likely being considered is related to Home Equity Lines of Credit (HELOCs). This is clear for two reasons. First, because the Bank of Canada believes that the greater use of HELOCs could also be contributing to increasing household indebtedness raising concerns that HELOCs may be putting some Canadians at risk of over borrowing.

The critical policy question that the Department of Finance could be considering is whether to extend the stress test for insured mortgages to uninsured mortgages as well.  This could possibly have an impact in further cooling the markets of Toronto and Vancouver.

Let’s hope the government shifts their focus to unsecured household debt instead of further secured debt restrictions. However, if the Bank of Canada’s review is representative of the Ministry of Finance’s considerations, watch out for changes to HELOCs with the stress test being applied to uninsured mortgages.

We should all write to our MP’s, enough is enough.  The market is cooling and all that is going to happen is more expensive mortgage financing and reduced competition.  Go after the unsecured loans and credit card companies, that is where consumer debt is out of control!

https://www.canadianmortgagetrends.com/2017/06/is-the-bank-of-canada-signalling-that-more-mortgage-rule-changes-are-coming/

Colleen Saunders is a 20 year veteran in the mortgage industry, serving Oakville, Mississauga, Burlington 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