Why we don’t reccomend Rent to Own

General Angela Calla 5 Jul

The Ottawa family who received a $10,000 cheque from an embattled rent-to-own business say they can’t cash it because the owner’s bank halted the payment.

Chantal Scott took the $10,000 cheque — delivered to her door on Tuesday evening by company owner Jean-Claude Lacasse — to a Laurentian Bank of Canada branch on Wednesday afternoon.

Full story here:

http://www.cbc.ca/news/canada/ottawa/story/2013/07/03/ottawa-rent-to-own-fraudulent-cheque-bank-certified-chantal-scott-lacasse-golden-oaks.html

We alwaya reccomend these fundementals if you are renting and looking to buy.

1. Practice homeownership- calculate what it would cost to own and make that payment every month, with the remainder over and above the rent going to your personal savings account.

2. Have the savings portion go into your savings via automatic withdrawl, take advatage of an rrsp program if your company offers one as that will be off of pre-tax dollars.

3. Know your credit and how to maintain the best score.  Most rent to own victims are individuals hope to restore their credit and that’s why that option is considered and appears attractive in the first place. Unfortunitaly a rent to own does not help restore or esablish credit.  Renting to own puts you not in control of your own money.

If you would like to understand your options to purchase a home or would like to calculate a budget, contact the Angela Calla Mortgage Team directly to help you at 604-802-3983 or callateam@dominionlending.ca

Thank you for visiting

 

Published on Brighterlife.ca July 4th 2013 Top 3 Newlywed Mistakes

General Angela Calla 4 Jul

These days, getting hitched and buying a home seem to go hand in hand. But if you want your wedded bliss to last, avoid these three classic mistakes.

Newlywed home-buying mistakes Top three mistakes newlyweds make in their real estate purchases:

1. Focusing on the interest rate

Who can resist an ad that promises you’ll only pay 2.99% over five years for a fixed-rate mortgage? Very few, it seems. But the lowest interest rate doesn’t necessarily mean the best mortgage for your situation, says Angela Calla, an accredited mortgage professional with Dominion Lending Centres in Vancouver and host of radio’s The Mortgage Show. She says such a mortgage likely has restrictions and penalties. Younger couples may need a more flexible mortgage – one that allows them to pay more when they have more and less when a spouse is on maternity leave or facing job loss, for instance.

While the payments required to carry a hefty mortgage are lower than, say, a decade ago, Calla says the strategy should be to repay the debt as quickly as possible. That means paying more money towards the mortgage than you technically need to. This strategy will pay off greatly when interest rates return to more normal levels. “Today’s interest rates are a gift and young couples have a great opportunity to pay off a significant part of their mortgage,” she adds.

But are they doing this? By and large, the answer is no. Many newlyweds tend to lack an overall plan for paying off the mortgage, notes David Field, a financial advisor with WSC Insurance Group in Oakville, Ont.

2. Not talking about their finances

Picture it: A young couple goes out for a Sunday drive and spots a new housing development in a trendy area. They see the open house signs and decide to take a quick look, since they’re in the neighbourhood anyway. Presto! They’ve found their dream starter home. Calla hears a version of this scenario more often than she’d like. The problem is, couples haven’t run the numbers ahead of time. “A lot of times, they don’t take the time to get preapproved for a mortgage before looking. They don’t even understand about each other’s credit situation,” she says. “One of them may not be in a financial position to even purchase a home. That can put a damper on their plans moving forward.”

3. Not factoring in other expenses

Young couples definitely know the amounts of their mortgage payments for the next three to five years. But when Field asks his newlywed clients about their property taxes, home insurance policy premiums and how much they are setting aside for emergencies, details get scarce. Many couples’ budgets are more mortgage-heavy than they should be. But taxes and insurance can rise significantly each year, and that translates into a lack of cash flow.

The lesson here? Make sure you are saving properly for retirement and emergencies, then see how comfortably your mortgage, utilities and property taxes fit into what’s left over. “If your cash flow is too tight, if something happens like losing your job or having a new baby, you are really constrained,” says Field. “A new marriage has its ups and downs as it is; adding money problems to the mix really affects the marriage.”

Financing Options & Grants for Home Renovations

General Angela Calla 4 Jul

There are many different reasons to renovate a home: to save energy (and save on utility bills), to make room for a growing family, to improve safety or increase the resale value of your home, or simply to bring a fresh new look to your home. There are also a number of different ways to finance your renovation.

Explore your options
Your own resources: For smaller renovation projects, you may consider self-funding material costs, especially if you plan to do the work yourself.

Credit card: Likewise, you can use your credit card to pay for materials for smaller renovations. But be careful not to carry the balance for too long. Credit card interest rates can exceed 18%.

Personal loan: With a personal loan, you pay regular payments of principal and interest for a set period, typically one to five years. You also have the option of a fixed or variable interest rate for the term of the loan. The interest rate on a personal loan is typically less than that of a credit card. Unlike a line of credit, however, once you pay off your loan, you’ll have to reapply to borrow any new funds needed.

Personal line of credit: This is another popular choice for financing renovations. It’s ideal for ongoing or long-term renovations since it lets you access your funds at any time and provides a monthly statement to help track expenses. A line of credit offers lower interest rates than credit cards, and charges interest only on funds used each month. And, as you pay off your balance, you can access remaining funds, up to the line of credit’s limit, without reapplying.

Secured lines of credit and home equity loans: These options offer all the advantages of regular lines of credit or loans, but are secured by your home’s equity. They can be very economical, since they offer preferred interest rates, but keep in mind that initial set-up costs including legal

 

 

and appraisal fees usually apply. Lines of credit are typically limited to 65%, while home equity loans are capped at 80% of your home’s value.

Mortgage refinancing: When funding major renovations, refinancing your mortgage lets you spread repayment over a longer period at mortgage interest rates, which are usually much lower than credit card or personal loan rates. This type of financing can allow you to borrow up to 80% of your home’s appraised value (less any outstanding mortgage balance). Initial set-up costs including legal and appraisal fees may apply.

Financing improvements upon purchase: If you’re planning major improvements for a home you’re about to purchase, it may be advantageous to finance the renovations at the time of purchase by adding their estimated costs to your mortgage. Canada Mortgage and Housing Corporation (CMHC) Mortgage Loan Insurance can help you obtain financing for both the purchase of your home and the renovations – up to 95% of the value after renovations – with a minimum down payment of 5%.

Grants/rebates for energy-saving renovations

Across Canada, renovation grants and rebates are available from the federal and provincial governments and local utilities, especially for energy-saving renovations. If you qualify, they may help pay for some of your project’s costs.

Angela Calla Mortgage Team 604-802-3983 callateam@dominionlending.ca

3 reasons to protect yourself with a 10 year fixed term

General Angela Calla 21 Jun

5 year fixed interest rates have bumped up over 70 basis points in just  2 weeks, making the 10 year the best opportunity for borrowers to protect themselves.

With mortgage rates at all-time lows, it seems longer terms are making a comeback. It turns out that fashion isn’t the only thing that comes back into style!

In fact, 10-year fixed mortgage rates have never looked so sexy. If you owned a home in the 80s or 90s, you may notice the 10-year term comeback!

 Following are three reasons to consider a 10-year mortgage term:

 1. After 5 years, you only have to pay three months’ interest to get out of the mortgage. This is currently the lowest penalty available to for a fixed rate – much more attractive than facing a much higher interest rate differential (IRD) penalty!

 2. You don’t need the equity out of your home for your next purchase as you can buy again with a 5% down payment. For instance, if you purchase with 5% down, your property would have to go up over 25% for you to get equity to use as a down payment for a second home, which is not likely in five years.

But, you can turn your current condo into a rental and buy your next home with 5% down (with a combination of savings or a gift). Rental mortgages usually require a 20% down payment, whereas primary residences typically require just 5% down. Purchasing a condo to live in until you’re ready to buy another home, and then renting out the condo, is a great way to become a real estate investor without having to come up with a 20% down payment.

 3. If you’re on a fixed income, taking advantage of a longer term fixed-rate mortgage can definitely be beneficial. Currently, with our historically low interest rates, a five-year fixed rate is around 3.19% and 10-year is around 3.99%. So, if after 5 years rates have risen to 3.8% or higher (which is very likely), you would have been ahead taking the current 10-year.

Instead of guessing how much longer rates will remain at historic lows, if you’re on a fixed income, you know you’ll be paying the same rate for 10 years. And, chances are, after 10 years are up, you will be in better shape financially and have more equity in your home.

The return of the solid 10-year means you have options. It may not be the best option for everyone and the market may change in a few weeks to make it less attractive. I will show you how all the products apply to you to ensure you receive the best product for your goals!

Thanks for visiting

Angela Calla, AMP

Dominion Lending Centres-Angela Calla

Host of ” The Mortgage Show” Saturdays @ 7pm on CKNW AM980

Phone: 604-802-3983 Email: callateam@dominionlending.ca

* rates are subject to change and final approval

Top 4 mistakes newlyweds make when getting a mortgage

General Angela Calla 21 Jun

Marriage is such an exciting milestone that offers so much hope for the future by uniting two partners to establish roots together. I have found that it’s important to consider the following when setting out on the marriage journey to ensure your financial house remains in order, since financial strain can put a lot of pressure on relationships:

 1. Your partner’s credit history/spending style. When you’re considering buying a home together, it’s important to know what you’ll be dealing with even before you decide to get preapproved for a mortgage. If you need to fix up your credit, for instance, knowing ahead of time can save lots of hassles down the road.

2. Setting up title. This may depend on your credit score as well, and also spark the conversation of your comfort level of equally being on title (meaning both borrowers will be using our first-time homebuyer’s status, provided you qualify). Another option is for one borrower to appear as a guarantor on the title (meaning the other spouse can use the first-time homebuyer status next time and have a potential future savings of $6,500). 

3. Down payment. If part of your down payment is a gift, some family members don’t want to give it unconditionally. They often want something in writing to ensure their family member gets back the gifted amount if you don’t happen to live happily ever after. If this is the case, you want to discuss this in advance so it’s one less discussion to have when purchasing a home together.

4. Focusing on rates. Regardless of your marital status, rate fixation is a trap many Canadians fall into. The right mortgage terms play the biggest role in becoming mortgage-free faster. Borrowers don’t want the lowest rate but, rather, the lowest cost of borrowing and transparency. We even help you with future insurance portability (mortgage and life). Failing to discuss your options with an independent mortgage broker and looking at more than just rate can easily mean you will owe more at the end of your mortgage term.

When you work with an unbiased mortgage professional our service is free and we are here to help you throughout the ever-changing market and your lifecycles to ensure you are presented with the best possible mortgage options. Building the best foundation by thinking ahead will help you stay ahead financially and minimize financial stress on your relationship.

Do you know someone who should have a discussion with our team about purchasing a home? Please forward this along to them and introduce us in an email, so we can help them build a plan!

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

 

Purchase Plus Improvements

General Angela Calla 14 May

Have you ever wondered if there was a way to get a mortgage larger than the purchase price of your home to do some renovations?

Do you want to do some renovations on a property you would like to purchase and don’t have the money or think you can afford to renovate?

The answer for you may exist in the Purchase Plus Improvements Program. This is a product available through the Angela Calla Mortgage Team where you can purchase a home and add 10%-20% or a maximum amount of $40,000 to your mortgage in order to improve the quality of your home at today’s record low rates when you’re making less than a 20% down payment.

How it works:

Improvements cannot exceed 10-20% or the lesser value of $40,000 of the property’s value or as improved. You would have to qualify for the full mortgage and improvement amount, and the advance would be given to you in one lump sum after the work has been completed. The extra funds are held in trust with the lawyer until the lender approves the appraisal or receipts, depending on the lender’s policy, to confirm the work is complete. Two to three quotes from a contractor will be required by the lender to review for approval, and the work should be completed within 90 days (some lenders will allow for a longer timeframe). Each case is different and we will help you every step of the way!

4 top reasons to consider this product:

1) You will not be accumulating outside debt at a higher interest rate, keeping with an affordable budget for buyers. Borrowers who use a line of credit or credit card would have higher carrying costs, when compared to fully discounted mortgage rates.

2) Helps quickly improve your new property’s value.

3) The appraiser/lender has to confirm the work has been completed, but it is not essential to confirm an increase in value of 20% for some lenders.

4) Lenders will generally have a policy requiring the work to be completed within 90 days, but some lenders have different timelines.

What renovations apply:

Different lenders have different policies, but most lenders approve fixed assets (eg, countertops, floors, paint, etc).

Understanding the numbers:

It’s important to keep in mind that the banks would prefer for you to pay for renovations via a line of credit or credit card as they earn much more money off these products. If you consider that a payment on a $10,000 loan not included in your mortgage works out to $300 dollars a month and $10,000 within a mortgage is approximately $50 a month, if you qualify, this product can save you $250 a month.

The Angela Calla Mortgage Team is always here to ensure you have the best product available for your needs, while saving you the most amount of money throughout the life of your mortgage.

Worried about the stress of living through renovations? This video is worth watching, FairTradeWorks make renovating easy! http://vimeo.com/67174441

 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

You are a homeowner..now what?

General Angela Calla 7 May

You found the home of your dreams, your offer was accepted and you just received the keys to your new home. Congratulations, you’re now officially a homeowner! So… what happens next?

To help you start your new life as a homeowner on the right foot, Canada Mortgage and Housing Corporation (CMHC) offers the following tips on how to protect your home – and your investment – in every season:

  • The most important thing you can do to become a responsible homeowner is make your mortgage payments on time. Late payments may result in charges and negatively affect your credit rating. Failing to make your mortgage payments can lead to even more serious consequences, including foreclosure.
  • A good way to make sure you stay on time is to have your mortgage payments automatically deducted from your account every month. It’s also recommended that you keep at least three months’ worth of mortgage payments in savings for emergency situations.
  • If you’re having trouble making your payments or know you’ll be late for an upcoming payment, talk to your mortgage professional.
  • To ensure your financial peace of mind, you should also prepare a detailed monthly budget and stick to it. If you haven’t already created a budget, use CMHC’s Household Budget as a Homeowner worksheet, available at www.cmhc.ca/homebuying, to give yourself a head start.
  • Besides your mortgage, property taxes and insurance, operating a home comes with many other ongoing costs.

 

 

These range from maintenance and repair costs to expenses like landscaping fees, utilities and condominium or strata fees. Be sure you include all the costs of homeownership in your monthly budget.

  • Take a few minutes each month to review your budget, check your spending and see if you’re meeting your financial goals. If you’re having trouble sticking to your budget, ask a professional money manager for help.
  • No matter how far you look ahead, unexpected costs can arise at any time. Try to set aside a percentage of your take-home pay in an emergency account to help you deal with any unexpected problems, major repairs, illness or job loss.
  • To keep your home safe and sound in every season, prepare and follow a regular schedule of monthly maintenance and repairs. Carrying out a few simple repairs each month can help put a stop to many of the most common and costly problems most homeowners encounter, before they can occur.
  • As a family, you should also get to know your home’s basic components and how to adjust or turn these systems off in case of an emergency. Create a fire evacuation plan, install a smoke alarm and carbon monoxide detectors, and always keep a list of emergency numbers (including 9-1-1, the poison prevention line, your doctor and neighbours or relatives) close to the phone.

To help you learn more about what to expect as a homeowner and all aspects of buying a home, CMHC’s Homebuying Step by Step: A Consumer Guide and Workbook will lead you through the home-buying process in five simple steps, from the moment you decide to buy a home of your own to the day the movers carry the first box through your new front door. 

The Angela Calla Team is here for you for the life of your mortgage, if you have any questions we are here to help callateam@dominionlending.ca

Easy Refinance Program for Qualified Borrowers & Properties

General Angela Calla 2 May

Easy Refinance Program Highlights:

This program is administered through FCT and covers the following at no cost to the borrower:

* All secured and unsecured debt payout

* One (1) signing appointment with an FCT representative

* Mortgage Registration

* Discharge of existing mortgages

* Lender title insurance

* All courier fees for the borrower(s) proceeds

* Appraisal Costs 

To qualify for this program, the following must be true at the time of closing:

* The mortgage amount must be between $200,000 and $750,000.

* The loan to value cannot exceed 75%.

* Must be Owner-Occupied and fully qualifying.  Second Homes allowed provided they are considered Owner-Occupied

Please note the Easy Refinance Program is only available under a 5 Year Fixed Rate term.
In the event that a deal does not qualify under the Easy Refinance Program,  we will ensure you get the best mortgage option to save you the most about of money over the term of your mortgage and you have the best mortgage for you and your future plans.

This option can be withdrawn at any time so we suggest you act quickly to see if it’s avaliable to you

Want to learn more about our New Refinance Program? Contact th Angela Calla Mortgage Team today callateam@dominionlending.ca 604-802-3983

Lenders with posted rates make penalties higher

General Angela Calla 23 Apr

 So back to that penalty issue… have you wondered how some lenders charge such a high penalty when the mortgage term is almost over? This is an obvious retention tool the banks leverage to keep you on their books!

 One of the many considerations we have when finding you the best mortgage is how they calculate penalties, as the market and your needs can easily shift throughout the term of your mortgage.

 Do they 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 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? This is one of the many advantages of having our team help you without bias to understand the different available options and the terms lenders use to make more money from borrowers. We help you keep your hard-earned money in your pocket.

 At the Angela Calla Mortgage Team, we first look to place your mortgage with a lender that does not use posted rates!

 

QUICK PENALTY CALCULATOR LENDER Broker Lender arranged by Angela Calla Mortgage Team

 

APPLICABLE IF CLIENT NOT TAKING A REPLACEMENT MORTGAGE

Client Current Rate

4.19%

Posted Rate Nearest to Months Remaining (eg. 16 months = 1 yr term)

3.09%

Initial Discount Granted Off Posted

0.00%

Differential

1.10%

 

 

Remaining Balance

$229,000

Remaining Months

16

 

 

Penalty Amount Calculation Steps

 

Remaining Balance x Differential

$2,519.00

Remaining Balance x Differential / 12

$209.92

 

 

Remaining Balance x Differential /12 x Remaining Months

$3,358.67

Reinvestment Fee of $300 (not applicable with Dominion Mortgage)

$0.00

TOTAL APPROXIMATE PENALTY

$3,358.67

 

 

 

 

QUICK PENALTY CALCULATOR LENDER Bank Mortgage obtained directly from borrower

 

APPLICABLE IF CLIENT NOT TAKING A REPLACEMENT MORTGAGE

Client Current Rate

4.19%

Posted Rate Nearest to Months Remaining (eg. 16 months = 1 yr term)

3.09%

Initial Discount Granted Off Posted

1.50%

Differential

2.60%

 

 

Remaining Balance

$229,000

Remaining Months

16

 

 

Penalty Amount Calculation Steps

 

Remaining Balance x Differential

$5,954.00

Remaining Balance x Differential / 12

$496.17

 

 

Remaining Balance x Differential /12 x Remaining Months

$7,938.67

Reinvestment Fee of $300 (not applicable with Dominion Mortgage)

$300.00

TOTAL APPROXIMATE PENALTY

$8,238.67

 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

What does it take to own an average home in 2013

General Angela Calla 23 Apr

In a recent Bank of Montreal survey, a First-Time Homebuyer is 29 years old and has saved a $48,000 down payment for a $300,000 home purchase.

Who fits this profile?

If you fit this average, it will take an annual household income grossing $40,000 per year (earning approximately $20 dollars full time and past your probationary period). If you are self-employed, this $40,000 income would have to be your net income based on at least two years of tax returns.

What if you don’t fit the average?

Lots of young Canadians find it next to impossible to save $48,000 for a down payment. Instead, they may be able to scrape together a 5% down payment ($15,000 using the $300,000 purchase price example) with a combination of savings, RRSPs and a gift.

You still have options – Your gross annual income needs to be: $50,000 – Your monthly mortgage payment with today’s average rates will work out to: $1,370

What can you buy?

Here are examples of over 800 homes within 45 minutes of Vancouver that are all 2 bedroom, 2 bathrooms with insuite laundry: http://rboies.mlslink.mlxchange.com/?r=903314772&id=363434333136.312

Home ownership comes with other expenses as well, including maintenance fees (condos/townhomes) and taxes which range from property to property. When you look at the fundamentals apparent in your personal scenario, home ownership may be easier than you think!

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