Be prepared to have more limited #mortgage options if you fall into the 5-plus property category

Click HERE to read the Business Vancouver article

Angela Calla, AMP
Dominion Lending Centres-Angela Calla
Host of ” The Mortgage Show” Saturdays @ 7pm on CKNW AM980
Phone : 604-802-3983 Fax: 604-939-8795
Email: acalla@dominionlending.ca
www.angelacalla.ca

The following changes below break down to 3 things being clarified

1.       No cashback mortgages anymore

2.       Harmonized qualifying between lenders- less applicants will qualify for the variable rate mortgage, it remains a luxury.

3.       Letters of Employment will continue to always be required (no real news here)

Questions on the best mortgage for you? Contact The Angela Calla Mortgage Team to help you personally 604-802-3983 callateam@dominionlending.ca 

April 27, 2015 

Subject: Homeowner Policy Modifications Relating to B-21 Guidelines 

In line with the industry focus on risk management, the OSFI B-21 Guidelines, and responsible diligent lending practices, CMHC is implementing policy modifications for homeowner 1-4 unit properties and providing greater clarification on the requirements surrounding the verification of the borrower’s income and employment. 

§        CMHC is harmonizing its policies with respect to the qualifying interest rates used for low ratio and high ratio loans submitted for mortgage loan insurance. Whether the loan is high or low ratio, qualifying interest rate for all variable rate mortgages regardless of the term, and fixed rate mortgages with a term less than five years, will be the greater of the contractual mortgage interest rate or the five-year benchmark interest rate. For fixed rate mortgages, where the term is 5 years or more, the qualifying interest rate is the contract interest rate. 
§        In line with industry efforts to encourage borrowers to save for homeownership, lender cash backs will no longer be considered as an eligible non-traditional source of down payment to satisfy minimum equity requirements. 
§        To add clarity and ensure increased consistency in how its policy is interpreted and applied, CMHC is modifying its policy with respect to the verification of the borrower’s income and employment. The policy will now state that lenders must obtain third party verification of the underlying income for all borrowers including substantiation of employment status and income history. 

The effective date to comply with the modifications and clarification outlined above is June 30, 2015. CMHC recognizes that the policy change related to qualifying interest rates for transactional low ratio loans may generate system impacts for some Approved Lenders. For this reason, CMHC is allowing for flexibility in implementing this change. Approved Lenders are expected to implement the change as early as possible and no later than December 31, 2015. 

Attached you will find a document covering common operational questions and answers surrounding this announcement. 

Please feel free to contact me if you have any questions. 

Angela Calla Mortgage team of Dominion Lending Centres helps thousands of first time home buyers enter the marketplace with confidence. 
Listen to how ACMT helped a 20 year old young woman have her first home for $300 less a month then her rent. Tune into The Mortgage Show on 1410am the Buzz every Saturday at 1pm

The best mortgage plan is one that is developed by assessing your goals and life stage. The Angela Calla Mortgage Team will help you personally call us at 604-802-3983 or email callateam@dominionlending.ca
To contact  Angela Calla directly call 604-802-3983 or visit
www.angelacalla.ca 

Angela Calla, AMP with Dominion Lending Centres discusses breaking your current mortgage to take advantageof today's lower rates. Angela Calla's team conducts annual mortgage reviews for all of their clients as a part of their mortgage coaching for being a valued client. Listen to how Angela and her team were able to help their client Anna save $550 per month on her mortgage.  

Questions on determining the best mortgage for you and your future? The Angela Calla Mortgage Team is here to help call us at 604-802-3983 or callateam@dominionlending.ca We look forward to helping you.

 Click HERE to watch the video

Are you purchasing a home for the first time? Looking to take some of the equity from the home you own for investment or pleasure? Or is mortgage is up for renewal? You need to consult the best accredited mortgage professional.

The Angela Calla Mortgage Team is here to help you personally with your mortgage related questions contact us directly at 604-802-3983 or callateam@dominionlending.ca

Click HERE to watch Angela Calla's video

Depending on the type of mortgage you have, penalties might be zero, three months’ interest, or something known as the interest rate differential amount. The costs can vary wildly, so be sure to ask how much you will owe if you break your mortgage. Talk to The Angela Calla Mortgage Team personally so we can help you avoid costly mistakes with our unbiased, transparent free advise 604-802-3983 callateam@dominionlending.ca

Click HERE to view Preet Banerjee’s video and look at the two main formulas used to calculate how much breaking a mortgage can cost you.

Want to know more? Tune in on Saturdays at 7pm to The Mortgage Show CKNW AM980.

 Angela Calla, Mortgage Expert, AMP of the Year in 2009 has been helping British Columbian families save money with the best mortgage strategy for over a decade from her Port Coquitlam office location. She is a regular contributor to national and regional media outlets, and sits on many advisory boards for mortgage lenders & insures. She can be reached directly to help you at 604-802-3983 orcallateam@dominionlending.ca www.angelacalla.ca

Compare the total cost(s) of owning a home 30 years ago to today, you will be very surprised:

Lifetime interest to home price ratio:
  *  Today:  0.53
  *  30 years ago:  1.77

Please click here for the complete article from the Financial Post

Questions about your mortgage options for home ownership, contact The Angela Calla Mortgage Team to help you personally 604-802-3983 callateam@dominionlending.ca

See how #AngelaCallateam helped a young couple from #Langley get the keys to their #firsthome 

Angela makes the top story on www.canadianmortgagetrends.com, Click Here to view a direct link to her article on Canadian mortgages trends-posted rates penalties pain!

One of the many important considerations to understand when sourcing the best mortgage is how different types of lenders – namely, banks versus lenders who only work with mortgage brokers – calculate penalties, as the market and your needs can easily shift throughout the term of your mortgage.

Does the lender charge a reinvestment fee as well?

Do they have hidden clauses about firm sales?

Do they charge a premium on top of the interest rate differential (IRD)?  

Below are two examples of how different lenders are calculating penalties. Which one would save you the most amount of money not only when you first get a mortgage, but also if you need to make a change?

Understanding the different available options and the terms lenders use to make more money from borrowers are some key differentiators that borrowers will benefit from only when working with mortgage brokers.

My first consideration when placing a mortgage is to look at lenders who don’t use posted rates!

I know that some lenders charge a high penalty – even when the mortgage term is almost over – as a retention tool leveraged to keep more mortgages on their books!

Following are two quick penalty calculators that compare typical banks versus broker lenders.

Penalty Calculator #1 – Broker Lender (applicable when not opting for a replacement mortgage)

 As you can see, there is quite a difference in the penalty amounts – $4,880.05. And this is a modest calculation comparison. Penalties can be tens of thousands of dollars higher depending on the lender’s specific calculation formula and how far into the mortgage term a borrower is at the time of breaking the mortgage.

 Another hefty cost can come in the form of additional clauses borrowers are usually unaware of if they deal with the lender. These include an additional 1-3% fee in above and beyond the IRD to pay out early.

 Imagine adding another $6,870.00 to the $8,238.72 for a total of $15,108.72 in penalties. This is certainly an amount that could potentially shut out moving as an option for many borrowers, as this amount is enough to eat up real estate commission and an extra bedroom in a home, to say the least.

 Some lenders may have a sale only clause in their mortgage as well. If you think, “Oh, that’s no big deal. I don’t plan on selling,” think again. Throughout every path in life, there are moving parts and uncertainties. When you get married, do you plan for a divorce? Likely not. Did you predict the company you were with for 20 years could downsize or your pension would be reduced or cut? Can you guarantee your health will never throw you a curve ball?

We all hope none of the above scenarios happen to us, but they can. And if they do, having options is extremely important.

You also have to consider that if the interest rate market changes 0.5-0.8% there are opportunities to optimize your mortgage to your advantage, but only if you have the most cost-effective mortgage in the first place, which, clearly, is not based on just your interest rate anymore.

Angela Calla, Mortgage Expert, AMP of the Year in 2009 and Host of The Mortgage Show on CKNW Saturday’s at 7pm. One of the most influential people in the mortgage industry for her sheer volume of people she helps save money on their mortgage, contributions she makes by consulting with Canadian’s national & regional lenders, insurers and media contributions. She and her Port Coquitlam, Port Moody & Vancouver team are here to help you personally at 604-802-3983 or callateam@dominionlending.ca