Shopping for a new home can be fun and exciting, but there are many details that contribute to a property’s marketability.

Mortgages that have the lowest total cost are reserved for the most marketable properties that are in prime locations as per the lender’s criteria.

Please remember that a mortgage professional can never advise a buyer to make any subject-free offers or even to remove the subjects on an offer.  The decision to remove subjects is one that the buyer has to make once all of the conditions for their mortgage approval have been satisfied with the lender(s).    Also remember that there cannot be any major changes to the borrower’s application details prior to the completion of their purchase as it may affect the borrower’s qualifications and change the conditions of the approval.

A mortgage professional will provide a buyer with the lowest cost and best mortgage for their scenario and for the property that they select to purchase.   This comes without limitations as we are without bias to any particular lenders and we protect a buyer’s credit score, which is another contributing factor to the best mortgage.

Here are some of the property details that can affect a lender’s decision on whether or not they approve a mortgage:

Property Zoning- if the zoning is anything other than plain residential then your options will be limited.  This sounds simple.  However, some condos are zoned commercial if there is a large commercial component to the complex. Industrial, Agricultural Land Reserve (ALR), or leasehold (government or otherwise) will limit a buyer’s options.

Strata Property                              House

Cable Cord Construction              Oil Tank(s) on the property

Self-Managed Stratas (no strata management company)

Size of the property- below 500 sq. feet

Doesn’t use Municipal Sewage Or Waste

Former Grow Op                           Former Marijuana Grow Op or used for illegal activity

Outdated Electrical                         Over 1 Acre and/or Multiple buildings

Age Restriction(s)                          Any animal use

Rental Usage                                Any structural issues/damages work done without permits

Ongoing or Upcoming Assessments or Legal Proceedings

Prior fixes in the building not done to the lender’s preference

Contingency fund with less than $1500 per unit in the entire Strata

The lender always reviews the details of each property only when an accepted offer is in place.  The request for information can be a simple document or it can require an explanation/written documentation from various parties.   This information may go back several years in order to get to the source of the issue.   This, of course, takes more time.

With complexities such as these, it’s important that a real estate agent discloses the information to their buyer right away so that it can be brought to the lender’s attention.    The agent should also be proactive in getting any and all documentation pertaining to the building/property so that the buyer can evaluate if a property has long term value to them.    Many of the issues stated above can affect the long term value and marketability of a property.

As a mortgage professional, we share any and all information that the lender provides to us if they decide not to approve a property that is being purchased.   We care about protecting borrowers from a bad real estate investment and are without bias in the advice that we provide.

We are always here to help,

Angela Calla

Mortgage Expert

Dominion Lending Centres

T: 604-802-3983

E: callateam@dominionlending.ca

W: www.angelacalla.ca

As a matter of fact I have been thinking of a testimonial, I’ve just been quite busy.  Here is our story, pick out whatever part you like.  I hope reading it give you folks a smile.

We got our down payment through a gift of inheritance, we never even considered that with housing prices the way they were going that we could ever afford a house of our own.   I had heard of Angela Calla on CKNW but I figured that she would mostly deal with large accounts seeing as she is the biggest name I know of.  I have had experiences with businesses that are used to dealing with larger clients and I was not always treated very well with my average sized pockets.  I spoke with a family friend who happened to know Angela Calla and strongly recommended her, told me she was a wonderful young lady and would be very good to me. 

My initial thoughts could not be further from the truth, once I contacted Angela she first made me feel like her most important customer, she helped me find a Realtor and told me some of the things to expect.  Once John and Dave helped me get pre-approved and explained to me what exactly that was, my fiancé and I  began looking at houses.  After getting out-bid for a few of the only detached houses still in our price range in Abbotsford, we decided to try to find a townhouse closer to our current address in Surrey.  It would appear everyone else decided to look for a townhouse in Surrey when we did as the market was absolutely insane. So Insane was the market that even when we were the highest bid on a townhouse that we loved we still couldn’t get an accepted offer.  When I was all but ready to give up Angela Calla, John Hsu, and David Holmes worked with my Realtor and after a few very fast, confusing, and down right frustrating turn of events and changes we managed to get an accepted offer mid-week, and they figured out all the financing details in an exceptionally short period of time. 

I then went into Angela Calla’s office at Dominion Lending to get some paperwork signed.  Until this point I had not met anyone in person and again I had thoughts of past dealing with other companies and I was nervous.  When I met John, he greeted me like a friend and was extremely patient with me answering my every question and explaining everything at a level that I could easily grasp.  He let me know all of my options and helped me to work out was would work best for me.  John was also great with my 1 year old daughter who wanted to be let in on some of the paperwork and claim the meeting room as her own.  I finally met Angela and David in person once all the papers were signed, and the warmth and welcoming feeling I got when I was at her office could best be described as the welcoming you get when you show up to a family barbecue. 

So if you were to ask me if I would recommend this particular team of people to someone in the future, I would.  In fact I would suggest that if you are a first time home buyer Angela Calla and her team should be the first place you go.  why should anyone settle?  The Angela Calla team group of warm regular folks that will do what it takes to get things done.    

Thanks guys, Jesse of Surrey

10 things to know about the 2016/17 provincial budget:

1. Buyers of newly-built homes worth up to $750,000 will be exempt from the property transfer tax, saving up to $13,000, effective Wednesday (only for Canadian citizens or permanent residents).

2. The new home tax exemption will only apply to people who actually live in the home as their principal residence for a year after the purchase (relatives do not qualify) and B.C. will share information with Revenue Canada to double-check whether the rules are being followed.

3. Homes (both new and used) sold for more than $2 million will see an increased property transfer tax of 3 per cent, up from 2 per cent.

4. The existing first-time homebuyers program for used homes remains in place, but the threshold is unchanged for properties worth less than $475,000.

5. Property buyers will need to disclose their citizenship for government tracking.

6. MSP premium rates will rise $3 per month for an adult to $78, starting in 2017, but children are now exempt.

7. The special discounted MSP rate for couples is eliminated, adding $14 a month to a family with two adults.

8. Taxpayer-supported debt is budgeted to rise to $43.2 billion, which means 3.7 cents of every dollar government earns it pays in debt servicing.

9. The $47.5 billion budget next year will have an estimated surplus of $264 million. The economy is expected to grow 2.4 per cent.

10.Income assistance for those on disability will rise $77 a month, except for those who already receive a bus pass or transit assistance. It’s the first increase in the rate in nine years. The overall welfare rate remains unchanged.

Readmore: http://www.vancouversun.com/business/budget+offers+help+buyers+homes/11723141/story.html#ixzz40NJPxtd2

Dec 31st 2015

Vancouver, BC – Dominion Lending Centres (DLC), Canada’s top mortgage company, is proud to announce its acquisition of Mortgage Architects, a leader in the Canadian mortgage space. DLC will keep all three of its brands (Dominion Lending Centres; Mortgage Centre Canada; Mortgage Architects) and run each of them alongside one another.
 
The DLC group of companies will now reach close to 40% market share, with a combined $32 billion in annual mortgage volume, translating to more than 100,000 individual mortgages per year.  

With now over 4,800 accredited mortgage professionals in the three companies, this acquisition will make the Dominion Lending Centres group of companies the largest mortgage originator in all of Canada – ahead of all major banks. 

See more here http://www.bnn.ca/Video/player.aspx?vid=780812 

Questions on your mortgage? The Angela Calla Mortgage Team is here to help you personally 604-802-3983 callateam@dominionlending.ca 

Official Release from the federal goverment: http://www.fin.gc.ca/n15/15-088-eng.asp 

Frequently asked questions: http://www.fin.gc.ca/afc/faq/hdpmeh-mfperpc-eng.asp

Chart showing amounts required below

New down payment rules will go into effective February 15, 2016.

The minimum down payment for new insured mortgages will increase from 5% to 10% for the portion of the house price above $500,000, the finance ministry wrote. For example: A $750,000 home will now require $50,000 down — 5% for the first $500,000 and 10% down for the remaining $250,000. 

Properties up to $500,000 will continue to require a minumum of 5% down. Properties in excess of $1 million will still require 20% down.  The changes are meant to reduce taxpayer exposure while supporting long-term stability of the housing market, according to the ministry.

The ministry commented that they believe this will only impact 1% of home purchasers.

A links of note regarding todays press release: http://www.theglobeandmail.com/report-on-business/economy/housing/liberals-raise-minimum-down-payments-for-houses-above-500000/article27711582/

Please contact The Angela Calla Mortgage Team directly with any questions on how we can help you or those you care most about at 604-802-3983 or callateam@dominionlending.ca

Mortgage Penalties… How They Should Be Calculated

Let me say this first, before we get to the whole rip-off thing…

Mortgage penalties are necessary. The bank has to protect their investment if you were to end up breaking off the mortgage early.

I mean, this makes sense. It’s the nature of a loan.

What doesn’t make sense is when a bank uses a RIDICULOUSLY ONE-SIDED penalty equation to essentially rob you of money.

We’re going to use the example of one our members, who, as I mentioned before, was over-penalized by $15,000.

There’s a little math in this post, but I’ll do my best to explain it simply.

If you don’t slow down and figure out this stuff, I guarantee it will come back to bite you on your own mortgage.

The Penalty… Calculated Fairly

One of our members was putting their home up for sale earlier this year because they needed to move for work.

Their original 5 year mortgage was taken out in August of 2013, directly with their bank, with a rate that I’m sure at the time was a deeply discounted 2.89%.

Here’s how their penalty should’ve been calculated, if the bank was honest about calculating their penalty.

MATH TIME.

Here’s the equation:

[(your rate) – (the current market rate for however many years you have left)] X (number of years left in term) X (Mortgage amount)[2.89% – 2.34%] X 3 X $446,770.84 = $7,371.72

THE RIPOFF:

Above you can see the statement our members sent us…

First, take a look at the column on the left, at “Interest Rate Discount Received.”

In their case according to their form, when they first got their mortgage they received a 2.10% rate discount…except….that’s incredibly deceptive.

Here’s why.

In order to believe they received a 2.10% discount at the time, this means that Scotiabank in fact was charging people 4.99% for a five year mortgage in 2013!

4.99%?

That’s a ridiculous rate. It would have NEVER happened in the marketplace because it’s so far from competitive. If you look at the graph on this page you can see that the average discounted, competitive rate during that year was 2.84% for a 5 year mortgage.

Therefore the 4.99% rate is an arbitrary, made up, Easter Bunny, Santa Clause number. It doesn’t exist.

ALL MAJOR BANKS DO THIS AND WE’LL SHOW YOU WHY

If you take a quick look at all the major banks, they all have a “posted rate” of 2+% higher then the actual rates they compete on in the marketplace.

Why do you suppose they do that?

Because it allows them, legally, to take thousands of dollars from your pocket.

Remember our original equation?

[2.89% – 2.34%] X 3 X $446,770.84 = $7,371.72

Remember, in our equation, that multiplier (the number in the brackets) came in at .55%. Or .0055.

At some point, the banks decided that using that multiplier wasn’t good enough. The bigger the multiplier, the bigger the penalty. So here’s what the bank’s equation looks like:

In other words: [Your rate – (current posted rate for a comparable three year term – discount received initially)] x (number of years remaining) x 445,770.84 =

Let’s break this down:

“Your rate” still equals 2.89%. That stays the same.

The second part is where things get sketchy. Their “current posted rate for a three year term” came in, for this case at 3.39%. It’s a high rate, but not outrageously so. But watch this abra-cadabra magic the bank is about to pull.

That second number? Discount received initially?

It’s the return of the 4.99% rate. They’re using the same “discount” from their arbitrary posted rate AGAIN.

This looks like:

2.89% – (3.39% – 2.1%)

2.89% – 1.29% = 1.6% …………… Compared to the 0.55% multiplier we used in the fair calculation.

LADIES AND GENTLEMAN, BOYS AND GIRLS, STEP RIGHT UP TO SEE A MULTIPLIER TRIPLE IN SIZE…

AND, AS A RESULT, TRIPLE THE PENALTY.

The difference here is obvious. Plug in all those numbers (we didn’t even get into them using the 3.42 instead of 3 years for the number of years), and you come up with a grand total penalty of $24,447.30.

But wait, there’s more!

In this specific case, Scotia Bank allows leniency in calculating their penalties, so they actually end up discounting our member roughly $2,000.

How nice of them.

The Bank’s Answer:

Obviously, this is an unfair system.

It gets worse…in this article from the Financial Post Laura Parsons, Calgary area manager for Bank Of Montreal actually said this….“You really have to understand what penalties (sic.) are,” said Ms. Parsons, who agrees that many people do not. “There is a responsibility of clients to read their documents but also for the lawyers to explain all the terms and conditions.”

In theory, I guess one could argue that she’s correct. But I believe, and I think most Canadians would as well, that when we are talking about such a potentially expensive feature of a mortgage, that maybe the bank people, like Laura and her employees, ought to show people this when they are shopping.

Of course, this idea is laughable. “Knowing” the bank does this is in no way addressing the issue, and for Ms. Parsons to claim that it’s the customers responsibility to avoid being screwed is a poor line of logic.

“So What Should We Do?!”

Take a deep breath. Put down the pitchforks.

First of all, there are many lenders that don’t charge penalties like this. Many of them (not the big 5 banks), still calculate penalties the old-fashioned, FAIR way. In fact, check out the image below. It’s a penalty comparison for one of our members that highlights the difference between all of the big 5 banks and the lender that we placed them with:

 

Second of all, EVERY single Canadian reading this blog post must ASK their bank employee to walk them through the penalty calculation that will happen if they were to pay the mortgage off early. Then, compare that to the other lenders they are shopping with, and factor that in when choosing their lender… not just the Interest rate they are charging.

Remember, a good rate could save you a maximum of 1k in 5 years, but it’s not worth it if the penalty is 15k more.

The Angela Calla Mortgage Team is here to help youensure you have the best possible mortgage call us today to avoid these expensive mistakes 604-802-3983 callateam@dominionlending.ca

Courtesy of the Globe & Mail

In early 2013, Kelly Vandenham and her boyfriend were preparing to put an offer on a charming Craftsman-style house in West Kelowna, B.C. They had been preapproved for a mortgage with Canadian Imperial Bank of Commerce, but the couple’s realtor suggested they could get a lower interest rate at Toronto-Dominion Bank, where their realtor’s boyfriend, Kulwinder Dhaliwal, worked as a mobile mortgage specialist. What happened next is a problem that continues to plague the financial industry despite steady changes to mortgage lending rules, a dilemma that some warn threatens to undermine faith in the country’s robust housing market. Shortly before the deal was set to close, according to court and regulatory tribunal documents, Mr. Dhaliwal e-mailed to say there was a problem with their application. Ms. Vandenham’s job letter from Interior Health Authority was missing some information, prompting the bank to take a closer look and potentially putting the deal at risk. In a statement she filed with a B.C. court later that year, Ms. Vandenham wrote that she offered to get a new letter the next day. Mr. Dhaliwhal responded that he “would figure something out.”

Read more here: http://www.theglobeandmail.com/report-on-business/economy/housing/mortgage-fraud-on-the-rise-among-brokers-trying-to-help-clients-qualify/article27051297/

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