Never Miss Great Tax-Time Freebies!

Never miss great tax-time freebies!

Here are two tax-time advantages available for upcoming first-time buyers and those who took the plunge last year.

1. The 90-day boost. If you’re buying your first home now and it’ll be at least 90 days before your move, let’s talk. The Federal Home Buyers’ Program (HBP) and a tax refund can boost the funds you have available for your purchase. First, make as big an RRSP contribution as you can – up to your contribution limit or $25,000 per person. You can even use your downpayment savings for this.  Big RRSP contribution means a great 2014 refund. Then, after 90 days, you can go back into your RRSP and redeem your contribution under the HBP program. So you’ve got your original downpayment funds back PLUS a nice fat tax refund. You’ll need to pay the withdrawn funds back on a repayment plan, but this strategy can make a substantial difference in the affordability of home ownership!
2. $750 for first-time buyers. Don’t leave money on the table if you bought your first home last year! You may be able to take advantage of the Home Buyers Tax Credit (HBTC) when you file your tax return. The $5,000 non-refundable HBTC provides up to $750 in federal tax relief. You qualify if neither you nor your spouse (or common-law partner) have owned and lived in another home for the past five years. For more information, visit the Action Plan website at www.actionplan.gc.ca/en/initiative/first-time-home-buyers-tax-credit.

 

Michelle Natareno

Mortgage Agent

519-675-8798

Helping new Canadians get a home of their own.

Helping new Canadians get a home of their own

New Canadians are making their numbers felt in the housing market, as they get settled and make the transition from renter to owner, with mortgage brokers helping to make that transition as easy as possible.

The most important considerations for new Canadians are credit history and downpayment. If you are new to Canada and do not have any established credit, you can qualify for a mortgage with three months of employment history and by demonstrating credit worthiness to your lender in other ways:

           •    Proof of timely rent payments confirmed by your landlord (non-family member) and bank statements

           •    Bank statements showing pre-authorized payments for12 months for regular payments such as utilities, telephone, cable, insurance premiums, along with a bank reference letter

           •    A credit report from your country of origin

Even though it is not required, it is a good idea to start establishing credit in Canada as soon as you can. A downpayment of five percent is the minimum, although a larger down payment may be required.

We can streamline the mortgage process for you, from counseling on credit, to obtaining credit references from foreign banks, to confirming foreign income. We’ll advise you on the paperwork you need to assemble to apply for a mortgage, and then present your financial history to the lender or lenders that can best meet your needs.

 

 

Michelle Natareno

Mortgage Agent

519-675-8798

 

 

When one of you wants to keep the marital home....

When one of you wants to keep the marital home…

A Spousal Separation Mortgage allows financing to 95 per cent!

It’s hard enough to get through the process of splitting assets in the event of a separation or divorce. What if one of you wants to keep the family home?   

We can help.

Although mortgage rules mean you can only refinance your home to 80 per cent of the value, a Spousal Separation Mortgage allows a buyout to 95 per cent, making it easier for one spouse to keep the home.  This new mortgage can provide a fair buyout, and possibly pay off other joint debt.

When one of you wants to keep the marital home… make us one of your first calls. We may be able to help clear some of the financial hurdles. We’ll guide you through the process, structuring the mortgage for the buyout of one spouse, and then help the other spouse with the purchase of a new home as well.  We believe that your home can be the asset that gives both partners a fresh start!

 

Michelle Natareno

Mortgage Agent

michelle@4dfinanical.com

519-675-8798

 

Fixed or Variable Rate?

Fixed or Variable-Rate Mortgage?

 

“Wow!” look at the mortgage rate those guys are advertising!  Your worries are over, you’re thinking. Just lock in a rate like that for the next five years, and you’ve got it made.

 

Not so fast. Right now, the lowest available rate – and the one that makes the rate sign look great from the street – will be for a variable mortgage. With a variable-rate mortgage, your mortgage rate will move in conjunction with your lender’s Prime lending rate, which in turn tracks the Bank of Canada’s benchmark rate, and will typically be quoted as Prime minus a specified percentage. Unless you have an economic ouija board, you won’t be able to predict what kind of rate ups and downs might be ahead of you.

 

With a fixed-rate mortgage, your payments are fixed for the term of the mortgage, which offers stability.  And because of changes to mortgage rules, locking in for five years or longer allows you to borrow more. Fixed-rates are usually better suited to first-time buyers or those who haven’t owned a home for a very long period. Ask yourself these questions: Do you like or need to know exactly what your payment is going to be over a longer period of time? Do you want to avoid the need to consistently watch rates? Do you have less than 20% down? If you answered “yes” to all or most, a fixed-rate mortgage could be the better choice for you.  

 

A variable-rate mortgage is best suited to people who have a flexible budget and can tolerate higher risk. Ask yourself these questions: Do you watch market conditions? Can you handle any sudden rate increases that could increase your payment? Do you have more than 20% equity in your home? If you answered “yes” to all or most, a variable-rate mortgage might best suit your needs. Most variables allow you to exercise an option to “lock in” a fixed rate at any time for the remaining portion of your mortgage term or longer.

 

If the uncertainty of a variable rate is going to give you sleepless nights, you’re in good company. Many Canadians prefer the certainty of a fixed-rate mortgage. They know exactly how much they will pay over the term of their mortgage, and they can plan accordingly… with no financial surprises.  However, lower-rate variable mortgages with a strong Prime minus offer give you the potential to save on interest. Your best option - have a mortgage professional help you decide which financing best meets your needs.

 

Michelle Natareno

Mortgage Agent

michelle@4dfinancial.com

519-675-8798

http://mortgageintelligence.ca/brokers/Michelle-Natareno

Don't sleep walk through your mortgage renewal.

Almost half of homeowners sleepwalk through their mortgage renewal

Given the large financial commitment of a mortgage, it’s surprising that 44 per cent of Canadian homeowners either just accept whatever their lender offers at renewal, or don’t even remember how they renewed!

It’s tempting to just sleepwalk through the mortgage renewal process. But if you’re not doing even the slightest comparison shopping or negotiating, then you’re missing out on an opportunity to save thousands on your mortgage. When your lender sends you a letter saying it’s time to renew… what that really means is that it’s time to get advice. Professional, independent advice.

Get an expert second opinion on what you’re being offered. We’ll take a look, and compare it to what we can find out there as an alternative among the 50 or more lenders we have access to.

Got a mortgage renewal coming up in the next six months? Let’s start talking!

* A recent CAAMP/Maritz survey found that only 56% of renewers negotiated, 44% took the mortgage rate originally offered by their lender (39%) or just didn’t know how they renewed (5%)

 

Michelle Natareno

Mortgage Agent

michelle@4dfinancial.com

519-675-8798

http://mortgageintelligence.ca/brokers/Michelle-Natareno

 

Ordinary Canadians can build wealth with investment properties.

Ordinary Canadians can build wealth with investment properties.

Across the country, ordinary Canadians are building personal wealth with investment property. An investment property is being increasingly viewed as a pension plan for the future, particularly since so many Canadians are not covered by workplace plans. Over the long term, an investment property can be a great source of retirement funds. Rental income typically pays for most or all expenses and property appreciation has often outperformed stocks and bonds over the long term.

This is not just an investment for well-established business people and experienced homebuyers. Savvy first-time buyers are often jumping in with both feet: purchasing a duplex or triplex, and then managing the additional units to pay down the mortgage while they make a start on home ownership. And parents who add up the cost of accommodations for their college-bound children are often deciding to be landlords themselves, seeing an opportunity to offset the cost of housing with a sound investment.

There are many reasons to consider investing in property. If you are thinking about building wealth with an investment property, talk to us. We can help you determine your downpayment options and run the financial calculations that you'll want to see for cashflow and capital appreciation.

 

Michelle Natareno

Mortgage Agent

519-675-8798

michelle@4dfinancial.com

 

What is the QUALIFYING RATE???

THE MORTGAGE GLOSSARY

 

What is the Qualifying Rate?

In 2010, the Department of Finance introduced the Qualifying Rate as a new way to assess borrower eligibility and ensure borrowers can handle their payments should rates begin to rise. Your lender will use the qualifying rate to calculate your debt service ratios, which must be at or below their guidelines.

The qualifying rate is a 5-year rate published every week by the Bank of Canada. For terms less than 5 years and for all variable rate mortgages, the qualifying interest rate is used if it is higher than the contract rate.  For 5-year terms and longer, the qualifying rate is the contract rate i.e the rate your lender is offering you.

What does the qualifying rate mean to you?

1.      The qualifying rate applies when you want a variable or 1 to 4-year fixed mortgage.  The qualifying rate is typically higher than the rate being offered by your lender.

2.      It is not used for qualifying 5-year fixed mortgages; you qualify based on the contract rate.

3.      A 5-year fixed mortgage may be the only term that qualifies you for the mortgage amount you need.

4.      Your actual payments are based on your contract rate, not the higher qualifying rate. 

We are experts at providing the advice, education and resources that homebuyers need. It’s important that you understand the terms you encounter when making what is likely your biggest purchase decision. 

I am  here to help you!

 

 

Michelle Natareno

Mortgage Agent

519-675-8798

michelle@4dfinancial.com

http://mortgageintelligence.ca/brokers/Michelle-Natareno

 

Looking for financing to improve the value of your home

Looking for financing to improve the value of your home? We see what you see.

New mortgage rules mean that Canadian homeowners can only refinance up to 80 per cent of the value of their home.  And when it comes to renovations, it can be a real catch-22: you want to increase the value of your home with a great renovation … but you can only borrow funds on the current, pre-reno value of your home. If you’re close to the 80 per cent loan to value (LTV), you can be out of luck.

Fortunately, our lenders see what you see. A Refinance Plus Improvements Mortgage allows you to refinance up to 80 per cent of the new, post-reno value of your home. You can add 10 per cent of your home’s value (to a maximum of $40,000) to your mortgage.

Here’s how it might work:

Current market value of home           $400,000
Current mortgage at 80% LTV          $320,000

A $40,000 renovation increases home value to $440,000. With a Refinance Plus Improvements Mortgage, you can finance up to $352,000 (80 per cent of new home value). That means you can add $32,000 to your mortgage: putting that great renovation within reach!

Home improvements can increase the value of your home, and improve the quality of your life. And your mortgage is your most cost-effective financing option. Better still, talk to us about using your pre-payment privileges to pay off your renovation faster.

So that vision you have for your home? We see what you see. Call me today!

 

 

Michelle Natareno

michelle@4dfinancial.com

519-675-8798

http://mortgageintelligence.ca/brokers/Michelle-Natareno