Tips for a great move

Ready for your next big adventure? 4 tips for a stress-free summer move

The majority of Canadians prefer to make their big move during the summer season. There are a variety of reasons for choosing this time of year: it is easier to transport boxes in non-icy conditions, no need to worry about your belongings freezing during transport, and children’s lives are not disrupted by the transition since they are on summer holidays.
Minimize potential moving chaos by asking yourself the following questions:

• Do you need to keep everything? Moving offers a good opportunity to reorganize your life by giving away, donating or recycling items that you no longer need. You’ll thank yourself later when there is less to pack and transport.

• How well do you know your moving company? The Office of Consumer Affairs drafted a Consumer Checklist for choosing a moving company and it reminds Canadians to request their moving estimate in advance and be mindful of seasonal rates (a summer move can be pricier). Will your items be held in the transport vehicle overnight or a secure facility? Consider purchasing Replacement Value Protection, which will ensure the company is liable if your possessions are damaged.

• Do you have enough boxes and packing materials? Start collecting boxes and newspapers in advance; ideally you should begin packing non-essential items a month in advance. Pack and clearly label a couple boxes with important first day arrival items, such as toothbrushes, remote controls, medication, and pet food, which could otherwise become lost in the shuffle.

• Once you step in the door, what are your top priorities? After the bed is set up, most people are eager to get connected by hooking up their TV, internet and home phone. Rogers introduced a free concierge service which makes this process easier by setting you up with a personal concierge agent. The agent proactively connects with customers throughout the transition, reviews order details, answers billing questions, and can assist with any changes to your order if your moving date needs to shift.

Entering the next chapter of your life can be a thrilling time, but like any significant life change, the process can be quite overwhelming. Control potential moving chaos by jotting down questions and tracking their completion on your personal checklist.

Source: News Canada

First Time Home Buyer Angst in Winnipeg

First Time Home Buyer Angst in Winnipeg

 

 

 

 

 

 

 

 

 

So you want to buy a new home?

Here are some important considerations when you enter the housing market in Winnipeg:

1)   You will face competitive offers. No matter how much you say you won’t bid large or write unconditional offers, many still do. The supply of homes in the first time home buyer range up to $250,000 are in demand so be prepared. No matter how much you prepare, when you are out there looking and have missed out on offers on other homes all logic and rationale will go out the window unless you are very patient.  Having the right realtor is something that you have control over so take the time in the selection.  Here are some great questions you can ask your realtor.

2)   Land Transfer Tax, the hidden surprise. Imagine buying your first home for $250,000 only to find out when you meet with the lawyer a week before your possesion date that you need $2720. for land transfer tax. This money goes directly to the Province of Manitoba to transfer the title from one name(s) to another. If this seems like a bit of a tax grab, you are right!

3)   While we are on taxes, in 2012 the Province of Manitoba introduced provincial sales tax on any mortgage default insurance premium. On a $250,000 home with a 5% down payment you can expect to pay $452.38 in sales tax. So first time buyers, the province is your pocket for $3172.38 and you haven’t even moved in yet. We continue to be one of the most heavily taxed provinces when it comes to purchasing a home, how are you feeling now?

4)   Property Disclosure Statements.  If you don’t feel that you need to know more about the property, here is an example of a home owner in Winnipeg who had a major surprise.  This happened on Christie Road in Winnipeg so it can happen anywhere.  Here is an example of a homeowner in Saskatoon who was able to legally go after losses relating to a basement that had water.  The Property Disclosure Statements were brought in to protect would be homeowners on any potential known problems with a home.

In the end, get professional well qualified advice to help make your first home buying experience the best possible.

 

Cancer & Financial Literacy

As the leaves change color, October weather teases us with the last taste of summer or abruptly knocks us in the gut to remind us of the changing seasons, life sometimes treats us exactly the same way.

Cancer and financial literacy really don’t have much in common, in fact one is all to prevalent in our lives while the other needs to be more prevalent.

After watching NFL football on Monday night, there was the common pink theme among both teams.  If two teams battling each other so violently can come together on one common ground, surely I can make a small difference. As I sat pondering my blog update next day, I had 4 cards to be signed and delivered to clients.  Normally I would send a gift card of some sort to accompany the card as a token of my appreciation.  Then it hit me like a thundering tackle in a football game, I am going Pink for October.  With every funded mortgage during the month, a donation will be made to the Canadian Cancer Society.  These clients will receive an acknowledgement in their honour.

November is Financial Literacy Month.  In preparation for financial literacy month, there a couple of contests open for individuals to enter.  The first is a contest eligible for youth ages 13 to 19.  It’s an easy contest to enter all you need to do is create a You Tube video and tell everyone why you are reaching for a financial goal.

In addition there is another contest open for post secondary students who could win up to $2500 for creating a 2 to 4 minute video.  Let’s some youth creativity to come up with some winners in Winnipeg.

In the spirit of financial literacy, I will be providing tips and tools through my Facebook page, twitter and Google+.  All you need to do is click on one of these links to get “hooked” up with all this timely info.  For every Winnipeg like on this facebook page during the month of October, I will donate an additional $2.  I’m starting at 55 so the rest is up to you.

Cancer and Financial Literacy, let’s kick some butt on both of these fronts.

 

Home Renovations Blog Week 4

After taking another week of holidays we completed the painting and flooring. The baseboards and painting on stairs remains before we can complete the flooring in that location. We had the unlucky 3 surprises this week. After measuring for the countertop we were told that our install date for the counter would be Nov 2, a far cry from our expected date of early August. After some great work by Floform to cut the quartz differently our order was fit with the remaining slab they had. We are extremely grateful for their efforts as we gave our sink and counter top to Restore (Habitat for Humanity). The Restore gives a great option to sending old items to the landfill.  The second surprise this week was a patio door that did not fit.  My wife calls this my $200 mistake as I had indicated it was 2×4 frame not 2×6 frame.  Home Depot accepted the return subject to the $200 restocking fee.  The 3rd surprise was a broken pendant light.  No biggie here, the glass was reordered and will arrive in 3 weeks.

We are back to work this week so Week 4 will see some progress but not as much as the last 3 weeks.  A liveable kitchen is the goal by August, we are almost there!

 

Home Renovations Blog Week 3

Ready to start week 3 with some great progress from the first 2 weeks.  The electical work has taken some time but when you add 15 pot lights, sound system control boxes, speakers to the ceiling, garbeurator wiring, undercabinet lighting wiring, etc, this takes some time espeically when the attic is so hot in the heat.  After the cabinet install, we had Flo Form out to measure the counter tops.  Now is the time we can start painting and add the flooring, it will be a busy week of activity to make some significant changes.

 

10 year mortgage rates, understanding the odds in your gamble

Since interest rates are at historic lows many consumers are asking questions about 10 year mortgage rates.  This short video gives you an understanding of what you need to understand to ensure you get the best odds on your bet, a 10 year mortgage is like placing a bet.

Here are few other keys points about 10 year mortgages:

1)  After the first 5 years of a 10 year mortgage, Canadian law states that the maximum penalty is 3 months interest payment and not Interest Rate Differential (IRD) like 1 – 5 year mortgages.

2)  Before you commit, have an Accredited Mortgage Professional assist you in the calculation in the video.  This will help you understand what your break even interest rate is in 5 years time.

3)  10 year mortgage rates are not very competitive in today’s environment, a mortgage broker can be a huge advantage for you, your bank or credit union may not be able to be very competitive.

 

 

 

 

 

Similar topics:  Understanding Mortgage Rates 

10 year mortgage rates

10 year mortgage rates

10 year mortgage rates

10 year mortgage rates

10 year mortgage rates
10 year mortgage rates

 

The Value of Good Mortgage Advice

A recent situation arose where a client was preapproved for a new home purchase by their bank.  Great, right?, not necessarily, they owned an existing home and were told by the bank representative that they should sell their home first and then purchase a new one.  They were moving down in price so the client assumed this was a no brainer.  The bank representative did not do the diligence in exploring their current situation.

They proceed to sell their home, agree on a price and then go out looking for a home.  They would have some equity to purchase a home however, were hoping to buy a new home with 5% down payment as pre approved by the bank.  The only catch in this situation is that in Canada an insurer(a 2nd step in the approval) needs to approve the mortgage with less than a 20% down payment.  The clients were not made aware of this and their application was not approved with 5% down payment.  Instead the insurer requested 10% down payment with some conditions that the client had to meet before the bank could get it approved.  The clients are now scrambling to look at options so they can own a home rather than rent.

The moral of this story is as follows:

1)  Get a second opinion after meeting with your bank.  The experience and knowledge of the bank representative may not be as good as you think.  Ask about their experience in mortgages and how many times they have handled a situation like yours.  A mortgage broker with the Accredited Mortgage Professional (AMP) designation is committed to ongoing education and professional development, a great first step in identifying someone who is committed to the consumer.

2)  Speak to your realtor about your options.  A professional realtor will review the options with you and team up with your mortgage advisor to assist you in a smooth transaction.  Making an offer, “subject to sale of your existing home”, may offer you the necessary security to ensure your new home and fianancing is approved before you sell your existing home.

Good advice from a team of professionals acting in your best interest is the key.

Falling in love

Have you fallen in love with a house?

Have you ever fallen in love only to be disappointed? This week a family was looking to purchase a home.  They were pre-approved by a mobile mortgage specialist at a major bank for up to $235,000.  The real estate agent and family continually stayed in touch with the mobile mortgage specialist to make sure everything was okay as they had made 7 offers on homes. They finally had an offer accepted on the 8th home they offered. It was accepted by the seller and they had 48 hours to arrange their financing, but they were pre-approved – so what could go wrong?

In actual fact they weren’t pre-approved, based on credit history and obtaining proper employment information up front. They could have been steered in a path to strengthen their position or look for a smaller home.  Imagine the realtor’s disappointment when they found they couldn’t get an approval.  They had just spent hours upon hours with this family, not only wasting their time and the family’s time but also the time of other realtors and sellers of homes.

My advice to realtors is this:

1 Be confident in asking the purchasers if the bank, mortgage professional, or mortgage broker actually reviewed their credit score and credit history with them.

2 Did they also ask for their employment letters, pay stubs?

3 Did they verify the down payment? (some down payments don’t qualify)

If they didn’t ask for this information, your purchasers may fall in love only to have their heart broken.  Don’t let it happen, make sure they are really pre-approved.

Media’s fear mongering

At a glance in the Winnipeg Free Press on July 8 is an article titled, “Manitoban’s vulnerable to mortgage-rate increase, poll finds”.  Now I know newspapers have to sell copies and they use blood and guts to do it, but really!  They quoted 82% of consumers in the most affordable major market in Canada would have a “problem” if rates increased by 1.5%.  What a bunch of hooey from a flawed survey sponsored by the same newspaper.  Did they define what the “PROBLEM” would be? NO  Did they find out what their existing rate is?  NO

At first glance I thought why would people feel this way because I don’t see that type of concern when I am talking to clients.  Off I go to Probe Research who conducted the survey, to find out more.  The first thing I see is most Manitobans would face financial distress with a 1.5% rise in rates.  Here is the definition of distress:  to afflict with great pain, anxiety, or sorrow; trouble; worry; bother.  If households feel they have a minor problem (49%) with rates increasing, that does not seem like it equals distress!

Although semantics might seem rather picky, the reality is most consumers do not have an interest rate that will be 1.5% higher than their existing rates for another 3.5 years.  For the last 1 1/2 years we have seen rates fall and most consumers are aware of this.  They purchase knowing very well that their interest rate is on sale and there won’t be any sale prices when their mortgage renews.  Almost all consumers in Manitoba I have dealt with know this and are very prudent in their decisions.  I have not seen many at maximum debt service ratios and those that do, usually have a much higher earning potential in the near future.  For those that have elected to take a Variable Rate Mortgage, they have factored in the rate they are willing to accept without causing any distress in their financial situation.

If you want to see a much more detailed and thorough report of the impact of interest rates on Canadians and Manitoban’s, just check out the report produced by CAAMP Economist Will Dunning , pages 35 – 37 and you will get a different story of tolerance in risk for mortgage holders.

Give Manitobans more credit than this survey would contend.  The headline should read, “Most Manitobans Prudent in their Mortgage Decisions”, but that doesn’t sell papers!

Fixed or variable

FIXED OR VARIABLE? This is a question that comes up increasingly in conversations with new or existing homeowners. My answer is always that it depends on their circumstances. There are 4 main factors to consider:

1. What is my risk tolerance? If you don’t like to take risk and want the sure thing, fixed rates offer you the comfort and security of knowing your payments for the next 3-10 years. Sometimes I refer to this as the sleep factor, does it keep me awake at night, if it does consider a fixed rate.

2. What is my current debt load? If you have tight cash flow and are concerned where you might be able to squeeze out more money for higher payments, you may want to consider a fixed rate. The other factor that can affect your debt load is job loss, reduced income, adding children to your family plus other factors. The opposite can be true if you are well educated and the prospects for your career and profession has a good future. Variable rate mortgages can save you money now if you are in this situation.

3. Do I know what is happening with rates? If you read the business section of the paper daily chances are that you know what is going on with interest rates. If you have a mortgage broker that communicates with you regularly, you have the advantage of being on top of this. I provide regular emails with rate updates and Bank of Canada announcements to keep consumers informed. Ultimately, it is their decision if and when they decide to lock in if they so choose.

4.  Consumers with equity in their home may feel more comfortable in choosing a variable rate mortgage.  If you have less equity and you get caught with rates increasing, you may end up with less equity.  This will be explained in a later post.

If you have been in a variable rate mortgage over the last century, you have fared better than someone in a fixed rate mortgage with your savings in interest. At some point this economic cycle will end and those with fixed rates below 5% will be seen and having made a good decision. The question is when is this time. In the investment world, market timing has never been viewed as a strategy to live by, the same is true in mortgages. If you wish to receive rate updates regularly, please let me know.