So, you’re thinking about buying a home. Should you get your mortgage through a local Port Coquitlam Mortgage Broker or your bank? While a bank can provide you with the select products offered by their institution, a mortgage broker can provide you with more choice – as they have access to hundreds of mortgage products available on the market.
Advantages of using a Port Coquitlam Mortgage Broker:
Our clients can expect to receive the best rates with fast, friendly, professional service and a mortgage package that is tailored to suit your personal needs. We are completely independent – our job is to work with you and for you to find the best mortgage products exclusively for you. Best of all, the services of a mortgage broker are free!
Milka started working in the banking world in 1994. She became an independent mortgage broker in 2006 and opened her own successful and locally recognized brokerage in 2009. She has been a resident of Port Coquitlam for the past 22 years with her husband, 3 children, and dog, Sparky.
Whether you are purchasing your first home, refinancing, renewing, switching lenders or purchasing a revenue/vacation property, a Port Coquitlam Mortgage Broker can provide you with professional unbiased advice.
Milka Lukacevic and the TMK Team is a member of The Mortgage Centre – one of Canada’s most established mortgage broker networks.
Types of Mortgages from your Trusted Mortgage Knowledge Professional
Purchasing a new home can be a stressful experience. On top of that, there are enough mortgage options in the marketplace to make your head spin. When it comes time, how will you know which one is right for you? Here are the most common mortgage options that you will come across, and why they may (or may not) be right for you.
As long as you have a 20 percent down payment, you will be able to apply for a conventional mortgage. These have a low loan-to-value ratio, meaning that the amount of the loan is low, relative to the value of the property.
This is a mortgage option where the borrower is contributing a down payment of less than 20 percent. These mortgages must have Mortgage Default Insurance through the Canada Mortgage and Housing Corporation (CMHC).
An open mortgage allows you the flexibility to make a lump sum prepayment or accelerated payments at any time before the end of the amortization period, without penalty. Although this option has greater flexibility, it tends to have a slightly higher interest rate.
Variable Rate Mortgage
These mortgages are initially set up like a standard loan, based on the current interest rate. The mortgage is reviewed at set intervals and if the prime rate has changed, either changing the size of the payment or the length of the amortization period, the lender will then alter the repayment plan.
Capped Rate Mortgage
This mortgage option offers a variable rate that is capped by the lending institution. Rates may fluctuate in the market, but the lender will offer a guarantee that you will never pay an interest rate above their cap.
Fixed Rate Mortgage
A fixed rate mortgage features an interest rate that is fixed for a set period of time. It’s easier to manage a budget as your payments won’t change during the term. Not only does this bring peace of mind, but you will also benefit from a lower rate than that of a variable rate mortgage.
With this option, you can move from a variable to a fixed rate, or a shorter to a longer term, at any time without a penalty. This is a good option to consider if you want to stick with a variable rate for the moment, but expect rates to rise in the near future.
A reverse mortgage provides you with the opportunity to transfer the equity in your home into cash value, if you have a need to do so. You will not have to worry about selling or vacating your home in the process. It has been touted as a good option for home owners who are nearing retirement and who have considerable equity in their home.
So, as you can see, there are many mortgage options available to you. If you’re feeling overwhelmed by all of this information, set up an appointment to discuss all of these options and more with a Trusted Mortgage Knowledge Professional.
The mortgage renewal process from your Trusted Mortgage Knowledge Professional
The mortgage renewal process is something that everyone with a mortgage needs to be fully aware of. If you have a mortgage agreement, then you are required to receive a renewal statement from your lender at least 21 days before the end of your current mortgage term.
Did you know that many people simply sign on the dotted line, without shopping around for a better rate? A Manulife survey found that almost two out of three Canadians surveyed stayed with their current provider and didn’t even try to negotiate.
I understand that people are busy; however, it is important to understand how much a percentage point can affect the total amount you pay over the lifetime of your term. Just a few tenths of a percentage point could mean thousands of dollars less in your pocket.
If you are renewing your mortgage, here are a few things to keep in mind before you sign the renewal document.
It is never a good idea to wait until you receive the renewal notice from your lender to begin shopping around for a better rate. The banks send these notices so close to the renewal date to deter people from shopping around. However, being proactive can help you to save a significant amount of money. I recommend beginning to shop around four months prior to your renewal.
Always think of the posted rate as the opening offer in a negotiation. Banks often use the posted rate to provide a value proposition to their clients. It is a better idea to shop around. If you only get rates from one financial institution, you may be paying a premium compared to other available rates in the market. A trusted mortgage knowledge professional will be able to help you negotiate with your current lender. It is important to do some legwork with a mortgage broker to ensure that you are getting access to the lowest interest rate possible.
A broker is an independent licensed mortgage specialist who negotiates with a variety of lenders to get their clients the best possible rate. Mortgage brokers can offer a better rate than the bank due to their access to multiple lenders. A Bank of Canada survey found that using a mortgage broker resulted in many Canadian’s getting a lower rate than what was offered by their bank.
As with any agreement, always read the small print before you sign. Make sure the mortgage product you choose offers other options such as the ability to pay extra on your mortgage and clearly defines any penalties, should you decide to break your mortgage agreement early.
If you don’t take the time to be proactive, then your mortgage will be automatically renewed after the 21-day period passes.
If you have any questions or if you want to begin shopping around well before your renewal notice arrives, get in contact with your local Port Coquitlam Trusted Mortgage Knowledge Professional, Milka Lukacevic of the TMK team.
The benefits of your own personal mortgage consultant from your Trusted Mortgage Knowledge Professional
So, you’re thinking about buying a home. Should you get your mortgage through a local Port Coquitlam mortgage broker or your bank? In the past, it used to be that if you wanted to do something substantial, like buy a home, your best course of action was to turn to your bank. While this remains an option, banks are no longer the sole option available to Canadians. A local, trusted mortgage broker may be a better choice when it comes to buying that new home.
A mortgage broker is an independent licensed mortgage specialist. When using a mortgage broker, essentially, you are hiring someone to act on your behalf. It is important to remember that mortgage brokers are not actual lenders themselves. Rather, they work with a variety of lenders and mortgage rates.
One of the main benefits of using a mortgage broker is that they have access to, and knowledge of the entire mortgage market. They understand the market, follow the trends, and know which institutions offer which mortgage products. Mortgage brokers can also access exclusive deals that are not available to the open market and can negotiate a better interest rate or lower application fees from the lender.
Mortgage brokers will assist you in the application process, from pre-approval to home appraisal. Most importantly, they can save you time. An experienced broker can identify the most appropriate lender for your specific circumstances and they will know which mortgage will be the most appropriate. To help further relieve your stress, they also handle the hassle of paperwork and interaction and negotiation with lenders.
Advantages of using a mortgage broker:
When you set up a meeting with one of Canada’s major banks for a mortgage, they will usually have you sit down with a loan officer. One of the main disadvantages of using your bank is that they can only access their own rates and products, even if there are better rates available in the market. As a result, you will always receive a higher interest rate from your bank.
For most of us, our mortgage will be the biggest financial decision we ever make. Working with a trusted Port Coquitlam mortgage broker is highly recommended.
It is important to understand how much a percentage point here and there can affect the total amount you pay over the lifetime of your mortgage. Just a few tenths of a percentage point could mean thousands of dollars less in your pocket. Understanding how to save yourself a percentage point could mean additional family trips, a maxed our RESP for your children or speeding up that retirement date by a couple of years.
The way we see it, the banks just can’t beat what we have to offer! If you want to experience the difference of a mortgage broker, set up a meeting with your local Port Coquitlam Trusted Mortgage Knowledge Professional, Milka Lukacevic of the TMK Team.
Are you considering purchasing a rental property? In this blog post, we will be discussing everything you will need to know before becoming a landlord.
First things first: can you afford this kind of commitment? You will need to ensure you have a steady income and a sufficient savings fund. All of your high-interest debts will need to be paid off and you should be on track to meeting your retirement savings goals.
After carefully considering your overall financial picture, you will want to map out all of the costs associated with purchasing a rental property. It is important to factor in:
Purchasing a property as an investor rather than an owner-occupant typically requires a larger down payment. You will need to have a 20-25% down payment available to apply to the purchase of the rental property.
As a homeowner with an existing mortgage, you will need to apply for a new mortgage on the rental property. An investment property mortgage requires specialty financing. This customized mortgage loan is slightly different from a traditional second mortgage. An experienced mortgage broker can help you find the right mortgage for your situation, and at a great rate.
Will you be able to afford the mortgage on the rental property if you are without a tenant for a month or two? Ensure you have enough saved to cover your two mortgage payments, recurring expenses, and routine maintenance and repairs.
When it comes to purchasing a rental property, it helps to find a realtor who’s interested in establishing a relationship, owns rental properties themselves, and specializes in the buying and selling of investment properties. Your local Port Coquitlam realtor can give you good advice about the neighbourhoods that are popular with renters in the community.
Another responsibility of a landlord is finding and evaluating tenants. Taking the time to evaluate potential clients will make a big difference on your experience as a landlord. Your goal is likely to find the perfect tenants. You know the kind? The renters who take immaculate care of their home. The ones who decorate for the holidays and take pride in their rental as if it was their own home. If you find renters like this, do everything you can to hold on to them. These kinds of tenants tend to require fewer repairs and will leave far less wear and tear behind when they eventually move out.
Another option is to use a property management company. They will likely use a professional tenant screening service to check credit reports, references, and perform a criminal background check on perspective tenants.
The extra work upfront is worth it in the long run. If you’re interested in obtaining a rental property mortgage, contact your local Port Coquitlam Trusted Mortgage Knowledge Professional, Milka Lukacevic of the Mortgage Centre TMK Team.
Refinancing your mortgage to pay off high consumer debt from your Trusted Mortgage Knowledge Professional
Debt is a major problem for many Canadian households – especially for those who have credit card debt in addition to mortgages, auto loans, and student loans. Are you drowning in credit card debt and sitting on equity in your home? If so, have you considered refinancing your mortgage?
There are steps you can take to lower your high consumer debt. For homeowners, one of them is to refinance your mortgage to help pay off your high consumer debt. Refinancing your mortgage can be beneficial for your financial future. That being said, deciding whether it makes sense to refinance your mortgage will depend on your individual situation.
Before refinancing a mortgage, consider the following:
You’ve probably noticed how low mortgage rates have been in the past few years. This is great for homeowners who want to lower their monthly mortgage payment by refinancing to a lower rate. But it can also help you reduce and eliminate high-interest credit card debt.
Almost 10 percentage points separate the average 30-year mortgage rate from the average credit card interest rate. This is because credit card debt is perceived as riskier than mortgage debt, thus, credit card companies charge interest accordingly.
There are many factors to consider when thinking about refinancing a mortgage to pay off high consumer debt. When it is done correctly, a refinance can save you money on long-term interest. If you are considering your options, talk with a Trusted Mortgage Knowledge Professional today – contact your local Port Coquitlam Mortgage Broker Milka Lukacevic of The Mortgage Centre TMK Team.
Tips for keeping your credit in check from your Trusted Mortgage Knowledge Professional
As the Christmas-spending bills are starting to roll in, are you wondering to yourself how you can keep your credit in check in 2017?
Whether you’re looking for a job, buying a new car or shopping for insurance, it’s always a good idea to review your credit report and ensure everything is in order. Whether the information in your report is accurate or not, any negative information can cost you – in the form of interest rates on loans. When it comes to your mortgage, this could end up costing you thousands. So, what should you do to keep your credit in check?
While your daily purchases may appear small and insignificant, they can add up over the course of a month. It is important to keep track of everything, including:
Review your monthly statements and report any discrepancies immediately.
Limit – Outstanding Balance = Available Credit
It is best to keep your balance contained within 30% of your limit, in order to maintain a good credit score. Charging more than 30% is potentially negative, even if you plan on paying off the balance when your statement comes. Why? Credit card issuers report the balance of the account when the statement closes. If the balance is high, your score will be affected, even if you pay your balance in full.
It is also a good idea to follow the 20/10 rule. By following this rule, you ensure that your debt never exceeds more than 20% of your total yearly income after taxes. Also, each month you should not have more than 10% of your monthly paycheques going towards credit payments.
It is a good idea to keep a 15% cushion of credit available in case of an emergency, such as a loss of income or an unexpected expense. That way, you do not have to borrow more than you’re comfortable repaying.
If nothing else, pay your minimum monthly payment on time every month. By paying more than your minimum, or better yet the full balance owed each month, you will reduce the hefty interest charges associated with late payments.
DO NOT skip any payments.
Making timely payments is the best way to establish yourself as a good credit risk to lenders. While certain bills do not get reported when you pay on time, they could end up on your credit report if you fall behind.
If your debt is getting out of hand and your numerous high monthly payments are making it difficult to meet all of your obligations, contact your local Tri-Cities Mortgage Broker, Milka Lukacevic of the Mortgage Centre TMK team.
In October 2016, Canadian Federal Finance Minister Bill Morneau announced new mortgage rules. First-time home buyers with mortgages insured by the Canada Mortgage and Housing Corporation will now be undergoing a more severe “stress test”. Beginning October 17, Canadian banks will test the ability of a buyer to repay a loan against a higher five-year rate. Morneau said that the new measures are aimed at reducing high household debt. It will also ensure middle-class families purchase homes that they can afford if interest rates fluctuate in the coming years.
Prior to this announcement, those with less than a 20 percent down payment were required to pass a “stress test” and have insurance backed by the federal government through the CMHC. Those who were able to put down more than 20 percent who were seeking an insured mortgage through a private insurer were not subjected to the “stress test”.
While this information may cut your purchasing power and put a squeeze on many home buyers – don’t give up hope!
On December 15, Christy Clark and the BC Government announced a new provincially backed loan program called the BC Home Owner Mortgage and Equity (HOME) Partnership. The BC Government has recognized that for many British Columbians, saving for a down payment is the hardest part of buying a first home. “Not everyone has a parent they can borrow money from to get into the housing marketing, and some need the government’s help,” Clark said. This program will provide first-time home buyers with a loan that is interest-free and payment-free for the first five years. These loans are available for condo, townhouse and detached home purchases. This is very encouraging news for those who have been trying to enter into the real estate market, but have been unable to put together a large enough down payment.
To learn more about the BC Home Owner Mortgage and Equity Partnership and how it can benefit you, contact your local Tri-Cities Mortgage Broker, Milka Lukacevic of the Mortgage Centre TMK team.
Professional advice from your Trusted Mortgage Knowledge Professional.
A fixed rate mortgage is usually set over a term of 1, 3, 5 or 10 years. During the length of the term, the rate you first sign with will be the rate you pay throughout the entirety of the mortgage. In other words, there will be no surprises along the way. You will have a permanent rate with a payment that won’t fluctuate.
Normally, the fixed rate is higher than the variable rate, with very few exceptions. In Canada, the fixed rate itself is determined by Canada Bond yields. These yields are driven by economic factors such as unemployment and inflation.
A variable rate mortgage is also set over a term of 1, 3, 5, or 10 years; however, it is priced at a lower rate. Why? Because if you decide to sign on for a variable rate mortgage, you are taking on more risk.
Unlike fixed rates, variable rates can change over the term of your mortgage. While this change may be a decrease in rate, it could also be an increase. Variable rate mortgages are also driven by economic factors. But in this instance, your rate isn’t secured. Rather, variable rate mortgages are driven by the prime rate. It is common for the Bank of Canada to reduce rates when the Canadian economy needs stimulus. On the other hand, they will raise the rates when the Canadian economy is thriving as a way to control inflation.
In a perfect world, we would be able to know ahead of time if the variable rates will increase, decrease or stay the same. But unfortunately, this isn’t the case. So now you must ask yourself:
“If the rates increase, will I still be able to afford to pay off my mortgage every month?”
When it comes to mortgages, there is no one-size-fits-all solution. One mortgage rate may look very attractive at the moment, but if you’re unsure how to navigate through all the possibilities, be sure to talk to a Trusted Mortgage Knowledge Professional. Contact Milka Lukacevic of The Mortgage Centre TMK Team, your local Tri-Cities Mortgage Broker.
Port Coquitlam Mortgage Refinancing Secrets for an Underwater Mortgage
There are more mortgage holders underwater than you might realize. An underwater mortgage is essentially when the balance of the owed amount of the mortgage is actually higher then market value of the property. This is the circumstance that a number of mortgage holders are facing. Refinancing an underwater mortgage might be the best way to help you save and qualifying is not as impossible as you might expect.
Here are a few secrets for refinancing your mortgage:
Just because you did not meet the strict guidelines for refinancing your underwater mortgage in the past does not mean that you won’t qualify now. Many of the strict guidelines for refinancing your mortgage have been lowered. This means that qualifying is much easier now. Don’t be discouraged from applying simply because you were disqualified at one time in the past.
The best way to ensure that you can refinance your underwater mortgage is to do research. You need to become more informed about the different government programs that are available and what the terms mean. Lower interest rates are what matter most to you, so this is where you need to spend most of your time researching. You can even get access to helpful eligibility calculators online that can assist you when deciding if you can qualify for refinancing your underwater mortgage.
Remember That Not All Lenders Are Created Equal
One secret that you can’t afford to forget involves that different lenders have different guidelines that applicants have to meet. Some lenders have more strict guidelines by nature and other lenders are looser with qualification guidelines.
Don’t Just Accept a Denial
Even if you get turned down by one lender, you should not just give of hope of refinancing your underwater mortgage altogether. You need to keep looking for the right mortgage broker that can help you refinance your mortgage. If you have an underwater mortgage chancers are the refinancing process will not be easy, but you should be able to find a lender that will eventually qualify you.
If you do the research and look for a qualified mortgage broker that is dedicated to helping you refinance your underwater mortgage, you should be able to save money and start to reduce the amount of debt that you currently face. An underwater mortgage can weigh heavily on your mind, but refinancing it and lowering your interest rate is possible.