So called “Skip a Mortgage Payment”

General Angela Calla 28 Feb

Lenders are advertising the option of skipping a mortgage payment more often these days – with one major bank even creating a TV ad!

But unless this is your only option, it’s not recommended that you skip a payment because, like most ads that sounds too good to be true, this option is as well.

Here is a real cost example:

Current Mortgage Payment $1530, 30 years at 3.30% = $2442.87 in interest costs if not paid back.

The banks want you to think they’re advertising the option to skip a payment to do you a favour. But it’s important to realize that lenders are in the business of making money. They’re not going to create an ad that doesn’t benefit them in the long run.

And it’s not like you can simply choose to skip any payment at will when you need it most. You actually have to prepay your mortgage in order to take advantage of this mortgage vacation option.

You can miss a regular mortgage payment as long as you have already prepaid that amount by doubling up any mortgage payment, increasing your mortgage payments or making lump sum payments. It’s important to know how much you can prepay each year before making extra payments – this varies from lender to lender.

The number of eligible payments covered by your payment vacation will be based on a combination of your prepaid amount and your current regular monthly mortgage payment. There is also typically a maximum payment vacation permitted per mortgage term, regardless of how much you have prepaid your mortgage.

 Other considerations to think about when looking at the mortgage vacation option include:

•             Interest is capitalized (ie, interest is added to your outstanding principal balance)

•             Borrowers lose the benefit and interest cost savings of prepaying their mortgage once they use the mortgage vacation option

 If you happen to already be in arrears on your mortgage, you can’t take advantage of this option.

It’s always important to read the fine print and ask questions when using a tool advertised by your lender. Better yet, speak to your mortgage professional – we know the ins and outs of all the bank offerings and can help advise you on your best options.

 As independent, unbiased mortgage professionals, it’s our job to show transparency to ensure you have the right security, product, term and rate for your mortgage needs at the lowest overall cost, and with the most control in homeownership for the security you deserve.

Angela Calla, AMP

Dominion Lending Centres-Angela Calla Mortgage Team

Host of The Mortgage Show Saturdays at 7pm on CKNW AM980

Phone: 604-802-3983 Fax: 604-939-8795

“An introduction to someone you care about is a big responsibility…it’s also the biggest compliment a client can give us & it’s not taken lightly. We pledge to treat everyone that is referred to us with the utmost respect & professionalism”.

www.angelacalla.ca

Reach my Team Chris Adkins & Denzil Anderson at 604-939-8777 & callateam2@dominionlending.ca

 

4 Main Points On Todays CMHC announcement.

General Angela Calla 28 Feb

Breaking News:

It has been announced today CMHC has decided to raise their mortgage insurance premiums.

Here are the 4 main takeaways:

1. This will increase the average purchaser with less than a 20% downpayment to have an increase in payment of approx $5 dollars a month as of May 1st 2014

2. This will affect any pre approval where the mortgage itself has not funded prior to that date.

3. This will not impact any already funded mortgages.

4. Genworth & Canada Guarentee will likely follow CHMC , they have not confirmed as of yet.

Its noteworthy CMHC has not raised premiums since the late 90’s and decreased their premiums back when Genworth decided to lower theirs a decade ago.

Working together with The Angela Calla Mortgage Team we will always ensure you save the most amount of money possible & receive timely information to help with clarity on your plans.

For the information straight from CHMC read : http://www.angelacalla.ca/blog_post?id=10591

More details at : http://m.theglobeandmail.com/report-on-business/cmhc-to-raise-mortgage-loan-premiums-may-1/article17159342/?service=mobile

If you have any questions on this change for you or someone that you care about The Angela Calla Mortgage Team is always a phone call 604-802-3983 or email away callateam@dominionlending.ca to help.

 

Angela Calla, AMP

Dominion Lending Centres-Angela Calla Mortgage Team

Host of The Mortgage Show Saturdays at 7pm on CKNW AM980

Phone: 604-802-3983 Fax: 604-939-8795

“An introduction to someone you care about is a big responsibility…it’s also the biggest compliment a client can give us & it’s not taken lightly. We pledge to treat everyone that is referred to us with the utmost respect & professionalism”.

www.angelacalla.ca

Reach my Team Chris Adkins & Denzil Anderson at 604-939-8777 & callateam2@dominionlending.ca

 

Breaking News-Increase to CHMC premiums May 1-2013

General Angela Calla 28 Feb

28 February 2014
 

Increase in Mortgage Loan Insurance Premiums for Homeowner and
1 – 4 Unit Rental Properties – Effective May 1, 2014

 
As a result of its annual review of its insurance products and capital requirements, CMHC is increasing its mortgage loan insurance premiums for homeowner and 1- 4 unit rental properties to reflect its increased capital targets.
 
CMHC’s capital management framework is consistent with international practices and Canadian guidelines for mortgage insurers. Higher capital targets are consistent with Canadian and international industry trends and make the financial system more stable and resilient. As CMHC mortgage insurance is backed by taxpayers, capital holdings reduce Canadian taxpayers’ exposure to the housing market, and contribute to the long term stability of the financial system.
 
For the average Canadian homebuyer requiring CMHC-insured financing, the higher premium will result in an increase of approximately $5 to their monthly mortgage payment. This is not expected to have a material impact on the housing market.
 
Effective May 1, 2014, the premiums will increase by 15%, on average. The premiums** and premium surcharges will be as follows:

 

Standard Premiums

Loan-to-Value Ratio

Total
Loan Amount

Increase to
Loan Amount

Up to and including 65%

0.60%

0.60%

Up to and including 75%

0.75%

2.60%

Up to and including 80%

1.25%

3.15%

Up to and including 85%

1.80%*

4.00%*

Up to and including 90%

2.40%*

4.90%*

Up to and including 95%

3.15%*

4.90%*

90.01% to 95% (Non-traditional Sources of Equity)

3.35%*

N/A

Self-Employed Borrowers without Third Party Validation of Income

Loan-to-Value Ratio

Total
Loan Amount

Increase to
Loan Amount

Up to and including 65%

0.90%

1.75%

Up to and including 75%

1.15%

3.00%

Up to and including 80%

1.90%

4.45%

Up to and including 85%

3.35%*

6.35%*

Up to and including 90%

5.45%*

8.05%*  

 

Rental Loans (1 – 4 Units)

Loan-to-Value Ratio

Total
Loan Amount

Increase to
Loan Amount

Up to and including 65%

1.45%

3.15%

Up to and including 75%

2.00%

3.45%

Up to and including 80%

2.90%

4.30%  

Note: Premiums shown with “*” do not apply for Refinance transactions.
**For purchase/new construction loan applications, the premium rate is applied to the Total Loan Amount. For portability and refinance loan applications, the premium is the lesser of the premium rate applied to the Increase to Loan Amount; or the premium rate applied to the Total Loan Amount.

 

Premium Surcharges

Extended Amortization Surcharge (for each 5 year period beyond 25 years)

0.25%

Blended Amortization Surcharge

0.60%

Conversion surcharge for self-employed borrowers without traditional documentation to support income verification

1.75%  

New premium rates will be effective for new mortgage loan insurance requests submitted on or after May 1, 2014. The current mortgage loan insurance premiums will apply for applications submitted to CMHC prior to May 1, 2014, regardless of the closing date. As is normal practice, complete borrower and property details must be submitted to CMHC when requesting mortgage loan insurance.
 
CMHC reviews its premiums on an annual basis and has adjusted them several times since being commercialized in 1998. Adjustments have included both increases and decreases to the premiums. Going forward, CMHC plans to announce decisions on premiums in the first quarter of each year.
 
To help you respond to consumer inquiries, CMHC has information available on the new premiums at www.cmhc.ca . 
 
Angela Calla Mortgage Team 604-802-3983 callateam@dominoinlending.ca

More information on the new tax relief for first time home buyers

General Angela Calla 20 Feb

The First Time Home Buyers’ Program reduces or eliminates the amount of property transfer tax you pay when you purchase your first home.

See the direct link from the goverment on this and other grants avaliable at

http://www2.gov.bc.ca/gov/topic.page?id=BBD16E2D7C1841A7BBD420E3AC5380F1&title=First+Time+Home+Buyers%27+Program

We are always here to to help yo uand those you care most about with the best mortgage options.

Angela Calla Mortgage Team

604-802-3983 callateam@dominionlending.ca

Job Posting-Account Manager for Mortgage Broker Team

General Angela Calla 20 Feb

Our mortgage broker team is looking for an Account Manager to support our continued growth.

 Duties/Responsibilities include (not limited to)

-diligently executing the following systems and policies

-Customer follow up

-Administration duties

– executing mortgage files from initial inquiry to completion, as well as mortgage management for the life of the mortgage

-Handling inquires via phone and email. some meetings with clients

Skills & Attributes Required:

-Team player – does not let the team down or offer excuses when something doesn’t go as planned

-Customer focused positive attitude at all times

– no cracking under pressure

-Strong organizational skills and proficient with Microsoft applications

-Quick learner and effective communicator who works well in fast-paced, deadline-driven team environment

-Must understand mortgages/financial wellness

-Must be willing to get licensed within four months of employment

 -You will be challenged to be your best, and must have the emotional security and maturity to be ready for it

This is a long term-position. Our team is like our family. We’re a small group who does big things in our industry because we don’t believe in limitations.

Please send your resume to: acalla@dominionlending.ca

Here is a video of our current account manager who is moving out of province explaining what’s its like to be a part of our team

http://www.viddler.com/v/97f66d4c?secret=36242494

Thank you,

 

Should you have your own realtor when buying a pre-sale? YES! Here is why

General Angela Calla 7 Feb

PRE-SALES – Should I call my own Realtor?

In a word…. YES!!

Remember – the sales staff at a sales center and employed by the Developer. Period. They are there to sell product and get the most for the Developer – not for you. Presales are generally less negotiable than traditional Real Estate listings, but that does not mean they are completely non-negotiable – especially when you factor in your own Realtor.  In the current market, we have secured many negotiated discounts for our buyers. Rob Boies has experience in development personally and has showed many homebuyers many options they didn’t know they could benifit from, all throughout the lower mainland

His familiarity with the market allow us to identify when negotiating is an option. Sometimes if the price is fixed, optional items, upgrades or deposit terms can still be negotiated. However, the Developers are far less likely to offer these “incentives” to Buyers without representation. Rob Boies has expert knowledge in WHAT to ask for, and HOW to ask for it, and get the most for your money. Further – the Developer’s Disclosure Statement can be a tricky thing to navigate. Are you confident in discerning:

  • What is an appropriate maintenance fee schedule?
  • Construction time frame for the building?
  • Co-existence & structure of Stratas involving Commercial Space?
  • Parking stall & storage locker arrangements?

These are just a few examples of factors that we will help you circumnavigate. Another consideration is what happens when you get closer to the closing date. The Developer will call you for your walk-through to preview the suite for deficiencies. If you are working without Rob Boies – the Customer Service representative will likely not want to draw your attention to deficiencies OR tell you that they are not things that should be fixed. Again – this is where we come in. We know what is appropriate and what is not – and we will speak up on your behalf to make sure it is done right.

If you are in the market for looking at upcoming projects – Email Rob Boies directly to learn about what projects you might enjoy learning about robboies@royallepage.ca or 604-341-3009

5 tips to maintain the best credit score

General Angela Calla 4 Feb

 

How do I ensure my credit score enables me to qualify for the best possible rate?

There are several things you can do to ensure your credit remains in good standing.Following are five steps you can follow:

1) Pay down credit cards. This is the #1 way to increase your credit score.

2) Limit the use of credit cards. If there’s a balance at the end of the month, this affects your score – credit formulas don’t take into account the fact that you may have paid the balance off the next month.

3) Check credit limits. Ensure everything’s up to date as old bills that have been paid can come back to haunt you.

4) Keep old cards. Older credit is better credit. Use older cards periodically and then pay them off.

5) Don’t let mistakes build up. Always dispute any mistakes or situations that may harm your score by making the credit bureau aware of each situation.

Angela Calla Mortgage Team

604-802-3983 callateam@dominionlending.ca

5 Questions Every Borrower Should Ask

General Angela Calla 4 Feb

As a mortgage borrower – particularly if this is your first time embarking upon homeownership – there’s no doubt you have a load of questions related to the mortgage process. Aside from the most common questions, such as those relating to mortgage rate, the maximum mortgage amount you’ll be able to receive, as well as how much money you’ll need to provide for a down payment, the following five questions and answers will help you dig a little deeper into the mortgage financing process.

1. Can I make lump-sum or other prepayments on my mortgage without being penalized? Most lenders enable lump-sum payments and increased mortgage payments to a maximum amount per year. But, since each lender and product is different, it’s important to check stipulations on prepayments prior to signing your mortgage papers. Most “no frills” mortgage products offering the lowest rates often do not allow for prepayments.

2. What mortgage term is best for me? Terms typically range from six months up to 10 years. The first consideration when comparing various mortgage terms is to understand that a longer term generally means a higher corresponding interest rate and a shorter term generally means a lower corresponding interest rate. While this generalization may lead you to believe that a shorter term is always the preferred option, this isn’t always the case. Sometimes there are other factors – either in the financial markets or in your own life – you’ll also have to take into consideration. If paying your mortgage each month places you close to the financial edge of your comfort zone, you may want to opt for a longer mortgage term, such as five or 10 years, so that you can ensure that you’ll be able to afford your mortgage payments should interest rates increase.

3. Is my mortgage portable? Fixed-rate products usually have a portability option. Lenders often use a “blended” system where your current mortgage rate stays the same on the mortgage amount ported over to the new property and the new balance is calculated using the current rate. With variable-rate mortgages, however, porting is usually not available. This means that when breaking your existing mortgage, you will face a penalty. This charge may or may not be

 

reimbursed with your new mortgage. Some lenders allow you to port your mortgage, but your sale and purchase have to happen on the same day, while others offer extended periods.

4. What amortization will work best for me? The lending industry’s benchmark amortization period is 25 years, and this is also the standard used by lenders when discussing mortgage offers, as well as the basis for mortgage calculators and payment tables. Shorter timeframes are also available. The main reason to opt for a shorter amortization period is that you’ll become mortgage-free sooner. And since you’re agreeing to pay off your mortgage in a shorter period of time, the interest you pay over the life of the mortgage is, therefore, greatly reduced. A shorter amortization also affords the luxury of building up equity in your home sooner. While it pays to opt for a shorter amortization period, other considerations must be made before selecting your amortization. Because you’re reducing the actual number of mortgage payments you make to pay off your mortgage, your regular payments will be higher. So if your income is irr egular because you’re paid commission or if you’re buying a home for the first time and will be carrying a large mortgage, a shorter amortization period that increases your regular payment amount and ties up your cash flow may not be your best option.

5. How do I ensure my credit score enables me to qualify for the best possible rate? There are several things you can do to ensure your credit remains in good standing. Following are five steps you can follow: 1) Pay down credit cards. This is the #1 way to increase your credit score. 2) Limit the use of credit cards. If there’s a balance at the end of the month, this affects your score – credit formulas don’t take into account the fact that you may have paid the balance off the next month. 3) Check credit limits. Ensure everything’s up to date as old bills that have been paid can come back to haunt you. 4) Keep old cards. Older credit is better credit. Use older cards periodically and then pay them off. 5) Don’t let mistakes build up. Always dispute any mistakes or situations that may harm your score by making the credit bureau aware of each situation.

As always, if you have any questions about the information above or your mortgage in general, I’m here to help!

Angela Calla Mortgage Team

604-802-3983

callateam@dominionlending.ca