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REALTY GLIMPSE LIVEMARCH 28, 2019

ME PROFESSIONALLY

• July will be 14 years with The Mortgage Centre

• 10 years as a CIBC banker

• Lending / Insurance / Investments

• Charter Member of BNI Northwest Success

• Rotary Club of Grande Prairie

• Grande Prairie & Fairview Chamber of Commerce

MORTGAGE BROKER

• Expert

• One Stop

• Work for You

• Choice

• Special Deals

• Things move quickly

• No cost to you

• Relationship

MORTGAGE

• Pride of Ownership

• Control

• Community

• Flexibility

• A mortgage, is a legal document you sign when buying or refinancing a home that gives your lender the right to take the property if you don’t repay the loan as agreed. A copy of your mortgage is filed in the county records as a lien, or legal claim, against the home.

PRE-APPROVAL

• Means nothing

• Credit bureau will expire

• Rate hold

PRE-APPROVALS

• This is the very first step before you begin shopping

• Your Pre-Approval should include:

• Purchase Price and other numbers• Payments

• Interest rates

• Down payment/Closing costs budget amounts

• List of the paperwork needed to proceed

• Information on the home-buying process

DOWN PAYMENTS

• Owner Occupied• 5% down payment

• 1.5% closing costs budget

• Rental Property• 20% down payment

• 1.5% closing costs budget

• Second Home – vacation home or immediate family member to reside rent free

• 5% down payment

• 1.5% closing costs budget

DOWN PAYMENTS

• Own Resources

• Gifted by an immediate family member

• Borrowed Down payment

• 1.5% closing costs budget saved from your own funds

• Two piece of credit for two years

• Minimum credit score (beacon) of 650

5 C’S OF CREDIT

• Character

• Capacity

• Capital

• Collateral

• Conditions

REMEMBER THE NUMBER

• Credit – 2 pieces for 2 years

• Overtime/Bonus – 2 year average

• Working for Family – 2 year average

• Business for Self – 2 year average

• Two jobs- both jobs for 2 years and a 2 year average is used for both

• Commission – 2 year average

• Bankruptcy – Discharged 2 years, 2 pieces of new credit for 2 years

CREDIT RATING

• 2 pieces for 2 years

• Payments on time

• 65% utilization

• Cell phones, Federal and Provincial Student loans report but do not count as credit

• Mortgages now report to the credit bureau

INSURER’S

• CMHC

• Genworth

• Canada Guaranty

• Insurers are required whenever there is less than a 20% down payment

• Sometimes due to the location and the property type, program being used lenders require insurer backing regardless of the down payment.

APPRAISALS

• < 20% down payment your property will be electronically appraised by the insurer

• If more than 20% down payment is required at your cost

• If a specialty program one will be required at your cost

• Private Purchase

• Rental Property

• If you don’t pay for the appraisal, you can’t see it and neither can I

PORTING

• Amortization remaining is IMPORTANT

• Straight Port – no new funds

• Port with New Funds – top up

• Port with a decrease

• Premium Credit within 2 years ish….

• Tiered

• Depends on how far along you are

PURCHASE + IMPROVEMENTS

• Purchase/Renos submitted together

• On possession PURCHASE funds are released

• The RENO money is released once:

• The renos are done

• INSPECTED

• Receipts handed in; or

• The contractor invoice

• There are maximums and time limits for this program

NEW TO CANADA – NEW TO CREDIT

• Within 5 years

• 5% down payment

• Rental reference letter

• 12 months bank statements

• Alternate source of credit

LESS THAN 20%???

• Purchase new owner occupied with 5% down

• Move in & leave your existing behind as a rental

• Has to make sense

• Using rental income to qualify:

• Legal conforming suite and we can only use a % of the rental income

DIVORCE

• This is tough

THREE CHOICES

• One buys the other out

• You sell

• You wait

• Yes, you will need a separation agreement

• The home can be refinanced (purchased) up to 95% of the value for buyout and joint debt reduction

SO THIS IS A THING

I NEED YOU TO KNOW

• It’s not just Purchase Price

• Property Taxes

• Square Footage

• Qualifying Rate

• Every 10,000 up or down in purchase price = 46 - 51 per month in payment approximately

• Our files need to be complete with lenders 10 business days prior to funding

2019 FEDERAL BUDGET

• CMHC FTHB Incentive Plan

• Fall 2019

• 120,000 maximum household income

• A mortgage no more than 4 times income

• 5% share equity mortgage - existing home

• 10% share equity mortgage - new homes

• Incentive paid back upon sale

2019 FEDERAL BUDGET

• RRSP Withdrawal

• 35,000 max

• Breakup of marriage or common law relationship

TRUE OR FALSE

• The second time you purchase the down payment is 10%?

• Keep credit cards maxed out?

• You can change jobs after you move into your home?

• You need a team of trusted advisors with experience?

• There are no fees to work with a mortgage broker?

MY ADVICE TO YOU

• Everything happens for a reason

• Bad things happen to good people

• Get a pre-approval FIRST

• Sell your house subject to you obtaining financing on a new one

• Over estimate rather than under

• Make all mortgage payments on time to be offered a renewal without having to qualify

THANK YOU!