Essential Tips to Avoid Common Mistakes When Buying a Presale Property in BC

General Angela Calla 25 Jan

As a valued member of our community, we want to ensure that you make informed decisions when it comes to purchasing presale properties in British Columbia. Buying a presale property can be an exciting investment opportunity, but it’s crucial to navigate the process wisely to avoid potential pitfalls. In this article, we’ll outline some common mistakes to steer clear of when entering the presale market in BC.

 

Neglecting Due Diligence:

One of the most significant mistakes buyers make is not conducting thorough research. Before committing to a presale property, investigate the developer’s reputation, project timeline, and financial stability. Verify their past projects, reviews, and track record to gain confidence in your investment. You absolutely need to use your own realtor (independent of the developer and its associates) speak with your mortgage broker, financial planner, and lawyer Consideration for what will happen and what the back up plan is in the event of

– income change

-relationship or health status change

-potential resale restrictions,

-where the deposit and closing costs are coming from, there cost and risk in value for when the closing date is or can be delayed.

Its essential to not only look at your personal life circumstances, but what you will do if the market changes and more money is demanded due to shift in market conditions or time for completion.

 

Ignoring Market Trends:

Keep a close eye on the current real estate market trends in BC. Failing to understand market conditions can lead to overpaying for a property or investing in an area that may not yield the expected returns. Consult with real estate experts, review market reports, and stay informed about economic factors influencing property values. The costliest mistake we see if clients going to a developer directly, who is biased to sell there product they are NOT there to give unbiased advise.

 

Underestimating Costs:

Presale prices may seem attractive, but it’s crucial to account for additional costs such as closing fees, GST, Property Transfer Tax,  Property Taxes, and Strata Fees. Ensure you have a comprehensive understanding of all associated costs to avoid financial surprises down the line.

 

Overlooking Contract Details:

The presale contract is a legally binding document, and overlooking its details can lead to complications. Pay close attention to clauses related to completion dates, potential delays, and warranty information. Consult with a legal professional to ensure you fully comprehend the terms and conditions. While the presale market is regulated by the provincial government, contracts for presales or preconstructed units are not. He also said they can be sticky to negotiate, and the wording is weighted in favour of developers. Not only can the developer refuse to consider an “assignment” option, it’s also not required to deliver exactly what the buyer saw in a showroom.

 

Ignoring the Fine Print:

Developers often provide disclosure statements outlining important information about the project. Ignoring these documents can result in misunderstandings or unmet expectations. Take the time to read and understand all the fine print, seeking clarification on any points that may seem unclear. “That’s why the Real Estate Development Marketing Act requires developers to provide a disclosure statement and gives purchasers the right to cancel presale contracts within the first seven days, so consumers have time to think through their decision

 

Skipping Inspections:

Even though you’re purchasing a property that hasn’t been built yet, it’s crucial to hire a qualified inspector to assess the developer’s reputation and the quality of their previous constructions. An inspection can reveal potential issues and help you make an informed decision.

 

Overlooking Financing Options:

Buyers sometimes make the mistake of not exploring various financing options. Shop around for mortgage options with a mortgage broker, consider pre-approval, and be aware of the potential impact of interest rate changes on your financial situation. Always ensure you have a worst case scenario back up plan.

 

Neglecting Resale Potential:

Consider the long-term prospects of the property, including its resale potential. A presale property should not only meet your current needs but also be a sound investment for the future. Evaluate the neighborhood’s growth potential and amenities that contribute to long-term value. .”  When a developer allows a contract to be re-assigned then a fee of one to three per cent of the sale price is usually charged to the original buyer and they remain legally liable to complete the purchase if the new buyer fails to do so.

By avoiding these common mistakes, you can approach the presale property market in BC with confidence and make decisions that align with your financial goals. If you have any questions or concerns, don’t hesitate to reach out to us directly for an introduction to experienced professionals to assist in guiding you through all aspects to ensure you understand the pros and cons tailored to your specific situation.

Happy house hunting!

Angela Calla is an 19-year award-winning woman of influence which sets her apart from the rest. Alongside her team, Angela passionately assists mortgage holders in acquiring the best possible mortgage. Through her presence on “The Mortgage Show” and through her best-selling book “The Mortgage Code“, Angela educates prospective home buyers by providing vital information on mortgages. In light of this, her success awarded her with the 2020Business Leader of the Year Award.

Angela is a frequent go-to source for media and publishers across the country. For media interviews, speaking inquiries, or personal mortgage assistance, please contact Angela at hello@countoncalla.ca or at 604-802-3983.

Click here to view the latest news on our blog. 

Bank of Canada Holds Rates Steady and Forecasts a Soft Landing

General Angela Calla 24 Jan

The Bank of Canada Holds Rates Steady And Expects Rate Cuts Later This Year

Today, The Bank of Canada held the overnight rate at 5% for the fourth consecutive meeting but provided an outlook suggesting that monetary easing will begin by mid-year. The Bank forecasts a soft landing for the Canadian economy, with inflation falling to 2.5% by the end of this year. While some economists predict a recession, the Bank suggests that “growth will likely remain close to zero through the first quarter of 2024” and “strengthen gradually around the middle of 2024.” This would be a soft landing.

While inflation ended 2023 at 3.4%, owing mainly to high and sticky shelter costs, “the Bank expects inflation to remain close to 3% during the first half of this year before gradually easing, returning to the 2% target in 2025. While the slowdown in demand is reducing price pressures in a broader number of CPI components and corporate pricing behaviour continues to normalize, core measures of inflation are not showing sustained declines.”

The press release says that the “Governing Council wants to see further and sustained easing in core inflation and continues to focus on the balance between demand and supply in the economy, inflation expectations, wage growth, and corporate pricing behaviour.”  The Bank now believes the economy is in excess supply, inflation expectations and corporate pricing behaviour are moving in the right direction, and wage demands, at 5.4% year-over-year in the last reading–are still too high. Wages are a lagging indicator and with job vacancies returning to pre-pandemic levels, wage pressures are likely to dissipate as the year progresses.

 

 

 

Today, the tone was much more optimistic, suggesting that policymakers are increasingly confident interest rates are restrictive enough to bring inflation back to the 2% target. Still, Bank officials want to see more progress on core inflation before it begins to ease. It said, “The Bank’s preferred measures of core inflation have been around 3½-4%, with the October data coming in towards the lower end of this range.”

The central bank focuses on “the balance between demand and supply in the economy, inflation expectations, wage growth, and corporate pricing behaviour” and remains resolute in restoring price stability.

Bottom Line

This was a more upbeat Bank of Canada statement. There is a good chance that monetary tightening has done its job, and inflation will trend downward in the coming months. As we have seen, the road to 2% inflation is bumpy, but we are heading there probably sooner than the Bank expects. As predicted, they are staying the course for now, but multiple rate cuts are likely this year. The scheduled dates for announcing the policy rate are March 6, April 10, June 5 and July 24. The Bank of Canada will begin cutting the overnight rate somewhere in there.

For now, my bet is on the June meeting, but if I’m wrong, it will likely be sooner rather than later. Once they begin to take rates down, they will do so gradually, 25 basis points at a time, and over a series of meetings. We could well see rates fall by 100-to-150 bps this year. Risks to the outlook remain, as always.

I do not expect the overnight policy rate to fall as low as the pre-Covid level of 1.75% this cycle. Inflation averaged less than 2% in the five years before COVID-19, depressed by increasing globalization and technological advances. Those forces are now reversed.

(Article courtesy of Dr. Sherry Cooper, Chief Economist, Dominion Lending Centres)

Angela Calla is an 19-year award-winning woman of influence which sets her apart from the rest. Alongside her team, Angela passionately assists mortgage holders in acquiring the best possible mortgage. Through her presence on “The Mortgage Show” and through her best-selling book “The Mortgage Code“, Angela educates prospective home buyers by providing vital information on mortgages. In light of this, her success awarded her with the 2020Business Leader of the Year Award.

Angela is a frequent go-to source for media and publishers across the country. For media interviews, speaking inquiries, or personal mortgage assistance, please contact Angela at hello@countoncalla.ca or at 604-802-3983.

Click here to view the latest news on our blog. 

Bank of Canada maintains policy rate, continues quantitative tightening

General Angela Calla 24 Jan

Bank of Canada Press Release

The Bank of Canada today held its target for the overnight rate at 5%, with the Bank Rate at 5¼% and the deposit rate at 5%. The Bank is continuing its policy of quantitative tightening.

Global economic growth continues to slow, with inflation easing gradually across most economies. While growth in the United States has been stronger than expected, it is anticipated to slow in 2024, with weakening consumer spending and business investment. In the euro area, the economy looks to be in a mild contraction. In China, low consumer confidence and policy uncertainty will likely restrain activity. Meanwhile, oil prices are about $10 per barrel lower than was assumed in the October Monetary Policy Report (MPR). Financial conditions have eased, largely reversing the tightening that occurred last autumn.

The Bank now forecasts global GDP growth of 2½% in 2024 and 2¾% in 2025, following 2023’s 3% pace. With softer growth this year, inflation rates in most advanced economies are expected to come down slowly, reaching central bank targets in 2025.

In Canada, the economy has stalled since the middle of 2023 and growth will likely remain close to zero through the first quarter of 2024. Consumers have pulled back their spending in response to higher prices and interest rates, and business investment has contracted. With weak growth, supply has caught up with demand and the economy now looks to be operating in modest excess supply. Labour market conditions have eased, with job vacancies returning to near pre-pandemic levels and new jobs being created at a slower rate than population growth. However, wages are still rising around 4% to 5%.

Economic growth is expected to strengthen gradually around the middle of 2024. In the second half of 2024, household spending will likely pick up and exports and business investment should get a boost from recovering foreign demand. Spending by governments contributes materially to growth through the year. Overall, the Bank forecasts GDP growth of 0.8% in 2024 and 2.4% in 2025, roughly unchanged from its October projection.

CPI inflation ended the year at 3.4%. Shelter costs remain the biggest contributor to above-target inflation. The Bank expects inflation to remain close to 3% during the first half of this year before gradually easing, returning to the 2% target in 2025. While the slowdown in demand is reducing price pressures in a broader number of CPI components and corporate pricing behaviour continues to normalize, core measures of inflation are not showing sustained declines.

Given the outlook, Governing Council decided to hold the policy rate at 5% and to continue to normalize the Bank’s balance sheet. The Council is still concerned about risks to the outlook for inflation, particularly the persistence in underlying inflation. Governing Council wants to see further and sustained easing in core inflation and continues to focus on the balance between demand and supply in the economy, inflation expectations, wage growth, and corporate pricing behaviour. The Bank remains resolute in its commitment to restoring price stability for Canadians.

Information note

The next scheduled date for announcing the overnight rate target is March 6, 2024. The Bank will publish its next full outlook for the economy and inflation, including risks to the projection, in the MPR on April 10, 2024.

 

Angela Calla is an 19-year award-winning woman of influence which sets her apart from the rest. Alongside her team, Angela passionately assists mortgage holders in acquiring the best possible mortgage. Through her presence on “The Mortgage Show” and through her best-selling book “The Mortgage Code“, Angela educates prospective home buyers by providing vital information on mortgages. In light of this, her success awarded her with the 2020Business Leader of the Year Award.

Angela is a frequent go-to source for media and publishers across the country. For media interviews, speaking inquiries, or personal mortgage assistance, please contact Angela at hello@countoncalla.ca or at 604-802-3983.

Click here to view the latest news on our blog. 

Understanding Adjustable-Rate Mortgages: A Comparative Analysis

General Angela Calla 23 Jan

As part of our commitment to keeping you informed about mortgage options, we wanted to share important insights on Adjustable-Rate Mortgages (ARMs) and how they compare to other mortgage types.

Below is a summary of key points for your consideration:

  1. What You Should Know:

ARMs have an interest rate and payment amount that can change.

If prime rates rise, your monthly ARM payment will increase.

If prime DECREASES your monthly payment would Decrease ( improving cashflow)

The principal payment is fixed, ensuring your amortization stays on schedule.

A 0.50% increase in interest rates would raise the monthly payment of a $500,000 mortgage by roughly $100, this works the same way for a decrease.

 

  1. How Do Adjustable-Rate Mortgages Work?

ARM rates change based on the prime rate.

An increase in interest rates results in immediate higher interest payments.

Monthly payments increase, OR decrease impacting budgeting and planning.

 

  1. Comparing Variable Rate vs. Adjustable Rate Mortgages:

Variable rate mortgages have a fixed monthly payment, leading to potential challenges if interest rates rise. ( think Trigger Rates reached in 2022)

Adjustable rate mortgages allow for changes in the interest payment while keeping the principal payment fixed.

 

  1. Mortgage Trigger Rate: read here

A trigger rate can cause a sudden increase in payments for variable-rate mortgages.

Adjustable-rate mortgages adjust payments to maintain consistent principal payments.

See the videos here from CBC and Global news https://angelacalla.ca/general/interest-rates-still-on-the-rise-global-and-cbc-coverage/

 

Example of an Adjustable Mortgage Rate:

A $500,000 mortgage with a 0.50% increase in the prime rate can raise monthly payments by $100.

 

  1. 2022 Scenario:

Bank of Canada’s rate hikes in 2022 increased prime rates from 2.45% to 6.45%.

For a $500,000 mortgage, monthly payments could rise by approximately $1,107.

Prime Jan 2024 is sitting at 7.2% making that monthly payment now approx. $ 1,220.00

 

  1. Why Choose an Adjustable Mortgage Rate?

Gradual payment changes. OR declines

Convertibility to a fixed rate.

Lower mortgage penalties (3 months’ interest).

 

  1. Is an Adjustable Mortgage Rate Right For Me?

Consider your financial situation and ability to cover potential payment increases.

Assess your tolerance for risk and willingness to adapt to changing interest rates.

These insights aim to provide clarity as you evaluate mortgage options.

 

If you have any questions or would like to discuss your specific situation further, please don’t hesitate to reach out. We are here to assist you in making informed decisions tailored to your needs.

Angela Calla is an 19-year award-winning woman of influence which sets her apart from the rest. Alongside her team, Angela passionately assists mortgage holders in acquiring the best possible mortgage. Through her presence on “The Mortgage Show” and through her best-selling book “The Mortgage Code“, Angela educates prospective home buyers by providing vital information on mortgages. In light of this, her success awarded her with the 2020Business Leader of the Year Award.

Angela is a frequent go-to source for media and publishers across the country. For media interviews, speaking inquiries, or personal mortgage assistance, please contact Angela at hello@countoncalla.ca or at 604-802-3983.

Click here to view the latest news on our blog. 

Decoding Mortgage Rates: Understanding the Influence of Bonds and the Bank of Canada Prime Rate

General Angela Calla 23 Jan

In the ever-evolving landscape of Canadian mortgages, understanding the factors that influence interest rates is crucial for homeowners making decisions about their financial future. One of the key distinctions lies in the basis for fixed interest rates, which are tied to the bond market, while variable and adjustable rates are influenced by the Bank of Canada Prime Rate.

 

 Fixed Interest Rates and the Bond Market:

Fixed-rate mortgages offer stability and predictability to homeowners, as the interest rate remains constant over the term of the loan. The foundation of fixed interest rates is intricately connected to the bond market.

When you secure a fixed-rate mortgage, your lender essentially bundles your mortgage with others and sells it as a mortgage-backed security on the bond market. These securities are attractive to investors seeking a steady and predictable return. The interest rate on fixed mortgages reflects the prevailing yields on government bonds, particularly those with a similar maturity period.

The bond market operates as a vast marketplace where governments and corporations issue bonds to raise capital. The yields on these bonds fluctuate based on various economic factors, including inflation rates, economic growth, and central bank policies. As bond yields rise or fall in response to these factors, fixed mortgage rates adjust accordingly.

In essence, homeowners with fixed-rate mortgages are indirectly linked to the bond market’s ebb and flow, providing them with a shield against short-term interest rate fluctuations.

 

Variable and Adjustable Rates and the Bank of Canada Prime Rate:

On the flip side, variable and adjustable-rate mortgages are anchored to the Bank of Canada Prime Rate. The Bank of Canada sets the Prime Rate as a benchmark for lending rates in the country. This rate is influenced by broader economic conditions, inflation, and the central bank’s monetary policy.

Variable-rate mortgages typically have an interest rate that is a set percentage above or below the Prime Rate. If the Prime Rate increases, so does the interest rate on variable mortgages, resulting in higher monthly payments for homeowners. Conversely, a decrease in the Prime Rate can lead to lower interest rates and more manageable payments.

Adjustable-rate mortgages, while similar to variable-rate mortgages, have a more intricate structure. They are tied to the Prime Rate but also include a predetermined margin set by the lender. This margin remains constant, but as the Prime Rate fluctuates, so does the overall interest rate on the mortgage.

 

Choosing the Right Path:

As a Canadian mortgage holder, recognizing the connection between interest rates and their underlying market dynamics empowers you to make informed decisions about your mortgage strategy. Fixed rates provide stability in a changing market, while variable and adjustable rates offer the potential for savings in a lower interest rate environment.

Ultimately, the choice between fixed and variable rates depends on your risk tolerance, financial goals, and the current economic climate. Staying informed about the factors influencing mortgage rates ensures you can navigate the complex world of home financing with confidence and clarity.

Remember, whether riding the stability of fixed rates or the flexibility of variable rates, your mortgage journey is uniquely yours. Understanding the intricate dance between the bond market and the Bank of Canada Prime Rate puts you in the driver’s seat, ready to navigate the road ahead.

Angela Calla is an 19-year award-winning woman of influence which sets her apart from the rest. Alongside her team, Angela passionately assists mortgage holders in acquiring the best possible mortgage. Through her presence on “The Mortgage Show” and through her best-selling book “The Mortgage Code“, Angela educates prospective home buyers by providing vital information on mortgages. In light of this, her success awarded her with the 2020Business Leader of the Year Award.

Angela is a frequent go-to source for media and publishers across the country. For media interviews, speaking inquiries, or personal mortgage assistance, please contact Angela at hello@countoncalla.ca or at 604-802-3983.

Click here to view the latest news on our blog. 

Canadian Inflation Rises to 3.4% Y/Y In December

General Angela Calla 17 Jan

A Bumpy Road To The Inflation Target

Canada’s headline inflation number for December ’23 moved up three bps to 3.4%, as expected, as gasoline prices didn’t fall as fast as a year ago. These so-called base effects were also evident in the earlier US inflation data for the same month.

Additional acceleration came from airfares, fuel oil, passenger vehicles and rent. Prices for food purchased from stores rose 4.7% yearly in December, matching the increase in November (+4.7%). Moderating the acceleration in the all-items CPI were lower prices for travel tours.

On a monthly basis, the CPI fell 0.3% in December after a 0.1% gain in November. Lower month-over-month price movements for travel tours (-18.2%) and gasoline (-4.4%) contributed to the monthly decline. The CPI rose 0.3% in December on a seasonally adjusted monthly basis.

Two key yearly inflation measures that are tracked closely by the Bank of Canada and filter out components with more volatile price fluctuations — the so-called trim and median core rates — increased, averaging 3.65%, from an upwardly revised 3.55% a month earlier. That’s faster than the 3.35% pace expected by economists. The trim rate rose due to the movements of rent and passenger vehicle prices.

Another important indicator, a three-month moving average of underlying price pressures, rose to an annualized pace of 3.63% in December from 2.94% in November, according to Bloomberg calculations. The Bank of Canada follows this metric closely because it reveals shorter-term inflation trends.

According to Bloomberg News, following the release of today’s CPI data, “the yield on two-year Canadian government bonds rose about four basis points to 3.857%…Traders in overnight swaps pushed back bets on when the Bank of Canada will start cutting rates to July, from as early as April before the release.”

 

Bottom Line

This is the last major data release before the Bank of Canada meets again on January 24th. I concur with the widely held view that the rate pause will continue at the next meeting despite evidence that the economy is slowing. Governor Tiff Macklem will err on the side of caution before beginning to cut overnight rates. The last reading on wages showed a 5.4% y/y rise, and yesterday’s housing release showed a bump in sales. Macklem and Co. will keep their powder dry until they see an all-clear signal that core inflation is sustainably below 3%.

(Article courtesy of Dr. Sherry Cooper, Chief Economist, Dominion Lending Centres)

Angela Calla is an 19-year award-winning woman of influence which sets her apart from the rest. Alongside her team, Angela passionately assists mortgage holders in acquiring the best possible mortgage. Through her presence on “The Mortgage Show” and through her best-selling book “The Mortgage Code“, Angela educates prospective home buyers by providing vital information on mortgages. In light of this, her success awarded her with the 2020Business Leader of the Year Award.

Angela is a frequent go-to source for media and publishers across the country. For media interviews, speaking inquiries, or personal mortgage assistance, please contact Angela at hello@countoncalla.ca or at 604-802-3983.

Click here to view the latest news on our blog. 

Angela Calla in Zolo Canada Housing Market and Rate Predictions for 2024

General Angela Calla 2 Jan

Mortgage Rates to Drop in 2024

The biggest factor our experts use to make housing market predictions for 2024 in Canada will be interest rates. The Bank of Canada has been raising interest rates since March 2022. These higher rates have had a widespread impact across Canada. Some effects have been positive (like lowering inflation), and some have been negative (like making mortgages more expensive).

That said, the high interest rates we’re seeing going into 2024 won’t be around forever. Mortgage interest rates are directly influenced by the Bank of Canada’s policy interest rate. So we asked mortgage broker and author of The Mortgage Code, Angela Calla, whether the Bank of Canada will hike rates in 2024, lower them, or hold them steady.

 

Calla believes that as long as inflation continues to trend close to the Bank of Canada’s 2% target rate, Canadians should expect mortgage rates to fall in mid-2024. But, since no one can accurately predict what will happen, it’s best to take a cautious approach. “In terms of time and how much,” Calla says, “plan for the worst and hope for the best.”

 

How Will 2024 Rates Affect My Mortgage?

Many borrowers took advantage of low mortgage rates in the early 2020s, buying a home when money was cheap and locking in their rate for several years. Now that rates have risen from those low levels (the lowest discounted rate was 1.38% in January 2021; today, the lowest rate is 5.19%), many Canadians will renew their mortgages at higher rates with higher monthly payments.

Between 2024 and 2025, 2.2 million Canadians are expected to renew their mortgages. That’s almost half of all mortgage holders. These renewals will happen at higher rates, which could increase mortgage payments between 30 to 40%.To help prepare for these rising costs, Calla recommends that you research and shop around for the best mortgage rate instead of signing your lender’s first renewal offer. “This will ensure you gain the lowest cost of borrowing and protect your credit score.”

Suppose you’re due to renew your mortgage in 2024 and find yourself unable to cope with the higher payments. In that case, you have options, like adding rental income, extending your amortization, or considering a reverse mortgage.

 

Should You Choose a Fixed or Variable Rate in 2024?

Choosing a fixed or variable-rate mortgage is a personal choice, and depends on your goals and risk tolerance. Fixed-rate mortgages have the benefit of stability. The rate doesn’t change throughout the term, and you’ll always pay the same amount each month. But they are more expensive to break if you plan to sell your home before your term ends.

“Breaking such a mortgage for market or lifestyle changes can incur an interest rate differential (IRD) penalty,” says Calla. This penalty can be in the tens of thousands of dollars for some mortgages. So, it’s an essential consideration if you plan to sell your home before your mortgage term ends.

Variable-rate mortgages, on the other hand, are more flexible. That said, your mortgage rate is subject to change. That means your principal payment and, in some cases, the entire monthly payment itself could change.

“When Canadians are at the crossroads of choosing between a fixed or variable-rate mortgage, a critical step is to weigh the risks and benefits of each option,” Calla says. If you aren’t sure, talking to a mortgage specialist is an excellent first step.

The Breakdown: Mortgage rates may fall in 2024. If your mortgage is renewing in 2024, prepare to renew at higher rates. Shop for the best rate and terms with a mortgage broker.

Read the full article here: ZOLO

Angela Calla is an 19-year award-winning woman of influence which sets her apart from the rest. Alongside her team, Angela passionately assists mortgage holders in acquiring the best possible mortgage. Through her presence on “The Mortgage Show” and through her best-selling book “The Mortgage Code“, Angela educates prospective home buyers by providing vital information on mortgages. In light of this, her success awarded her with the 2020Business Leader of the Year Award.

Angela is a frequent go-to source for media and publishers across the country. For media interviews, speaking inquiries, or personal mortgage assistance, please contact Angela at hello@countoncalla.ca or at 604-802-3983.

Click here to view the latest news on our blog. 

 

Debunking Canadian Mortgage Myths: What You Shouldn’t Believe

General Angela Calla 19 Dec

Debunking Canadian Mortgage Myths: What You Shouldn’t Believe

Introduction:

In the dynamic landscape of Canadian real estate, misinformation can circulate easily, leading to misconceptions about mortgages. As you embark on your homeownership journey or consider refinancing, it’s crucial to separate fact from fiction. In this blog post, we’ll debunk common myths surrounding Canadian mortgages, empowering you with accurate information to make informed decisions about one of the most significant financial commitments in your life.

Myth 1: You Need a 20% Down Payment to Buy a Home

Reality: Contrary to popular belief, a 20% down payment is not a mandatory requirement to purchase a home in Canada. While a larger down payment can offer advantages, many lenders offer mortgage options with lower down payment requirements. Various government-backed programs and mortgage insurance options cater to buyers with more modest down payments.

Myth 2: Fixed-Rate Mortgages are Always the Best Option

Reality: The choice between fixed and variable-rate mortgages depends on your financial goals and risk tolerance. While fixed-rate mortgages offer stability with predictable payments, variable rates can provide potential savings in certain economic conditions. Understanding your preferences and consulting with a mortgage professional can help you make the right decision based on your unique situation.

Myth 3: Refinancing is Always a Money-Saving Move

Reality: Refinancing can be a valuable tool, but it’s not always a guaranteed money-saving strategy. It’s crucial to assess the costs associated with refinancing, including closing costs and potential penalties. Additionally, understanding your long-term financial goals and the impact of refinancing on your overall mortgage term is essential for making informed decisions.

Myth 4: Your Mortgage Rate Is the Only Factor Influencing Affordability

Reality: While the mortgage rate is a significant factor in determining affordability, it’s not the sole consideration. Other costs, such as property taxes, insurance, and potential maintenance fees, contribute to the overall cost of homeownership. Evaluating the complete financial picture ensures a more accurate understanding of what you can afford.

Myth 5: Paying Off Your Mortgage Early Always Saves Money

Reality: While paying off your mortgage early can save on interest payments, it’s essential to consider other financial priorities. Depending on your overall financial situation, investing in other areas such as retirement savings or education funds may offer better long-term benefits. Assessing your financial goals holistically is crucial for making informed decisions.

Conclusion:

Navigating the Canadian mortgage landscape requires accurate information and a discerning eye to debunk common myths. By separating fact from fiction, you empower yourself with the knowledge needed to make informed decisions about your mortgage. Whether you’re a first-time homebuyer or considering refinancing, consulting with a mortgage professional, like the Angela Calla Mortgage Team, ensures that you have access to expert guidance and personalized advice tailored to your unique financial situation. As you navigate the world of Canadian mortgages, armed with accurate information, you can confidently make choices that align with your financial goals and set the stage for a successful homeownership journey.

Angela Calla is an 19-year award-winning woman of influence which sets her apart from the rest. Alongside her team, Angela passionately assists mortgage holders in acquiring the best possible mortgage. Through her presence on “The Mortgage Show” and through her best-selling book “The Mortgage Code“, Angela educates prospective home buyers by providing vital information on mortgages. In light of this, her success awarded her with the 2020Business Leader of the Year Award.

Angela is a frequent go-to source for media and publishers across the country. For media interviews, speaking inquiries, or personal mortgage assistance, please contact Angela at hello@countoncalla.ca or at 604-802-3983.

Click here to view the latest news on our blog. 

Canadian Mortgage Renewal: What You Need to Know

General Angela Calla 19 Dec

Understanding Mortgage Renewal in Canada

  1. Know Your Renewal Date:

Mark your calendar! Your lender will typically notify you of your mortgage renewal well in advance. It’s crucial to be aware of this date to allow ample time for preparation and decision-making.

 

  1. Assess Your Financial Situation:

Take a closer look at your current financial standing. Consider changes in income, expenses, and any shifts in your long-term financial goals. Understanding your financial situation will influence your decisions during the renewal process.

 

Negotiating Rates:

  1. Research Current Rates:

Before entering negotiations, research the current mortgage rates in the market. This knowledge provides you with a benchmark to gauge the competitiveness of the rates your lender offers during the renewal process.

 

  1. Negotiate with Your Lender:

Don’t hesitate to negotiate with your existing lender. They want to retain your business, and often, they are willing to adjust rates or offer additional benefits to keep you as a customer. Be prepared to leverage your creditworthiness and loyalty to secure favorable terms.

 

Consider Your Options:

  1. Stick with Your Current Lender:

Renewing with your current lender is a straightforward option. However, it’s essential to explore the terms they offer and ensure they align with your financial goals.

 

  1. Shop Around:

Don’t be afraid to explore other lenders in the market. Shopping around allows you to compare rates and terms, potentially leading to a more advantageous mortgage package.

 

Assessing Your Mortgage Needs:

  1. Review Your Mortgage Terms:

Take this opportunity to review your current mortgage terms. Assess whether they still meet your needs or if adjustments are necessary. This could include changes to the length of the mortgage term or considering a switch from a fixed to a variable rate, or vice versa.

 

  1. Consult with a Mortgage Professional:

Seeking advice from mortgage professionals, like the Angela Calla Mortgage Team, can provide valuable insights into market trends and help you make informed decisions about your mortgage renewal.

 

Conclusion:

Canadian mortgage renewal is a pivotal moment in your homeownership journey, and understanding the process is key to making sound financial decisions. From negotiating rates to assessing your financial situation and exploring your options, this guide empowers you to navigate the renewal process with confidence. Whether you choose to renew with your current lender or explore new opportunities in the market, taking a proactive approach ensures that your mortgage aligns with your evolving financial goals. As your mortgage term approaches its end, use this guide to guide you through the renewal process, and secure a mortgage that suits your needs and sets the stage for continued financial success.

Angela Calla is an 19-year award-winning woman of influence which sets her apart from the rest. Alongside her team, Angela passionately assists mortgage holders in acquiring the best possible mortgage. Through her presence on “The Mortgage Show” and through her best-selling book “The Mortgage Code“, Angela educates prospective home buyers by providing vital information on mortgages. In light of this, her success awarded her with the 2020Business Leader of the Year Award.

Angela is a frequent go-to source for media and publishers across the country. For media interviews, speaking inquiries, or personal mortgage assistance, please contact Angela at hello@countoncalla.ca or at 604-802-3983.

Click here to view the latest news on our blog. 

Understanding Mortgage Pre-Approval: Your Key to a Successful Home Purchase

General Angela Calla 19 Dec

Embarking on the journey to homeownership is an exhilarating experience, but it comes with its fair share of financial considerations. One crucial step that can significantly enhance your homebuying journey is obtaining a mortgage pre-approval. In this guide, we’ll demystify the mortgage pre-approval process in Canada, highlighting its importance, providing insights on how to get pre-approved, and showcasing the advantages it offers when you’re ready to shop for your dream home.

 

The Importance of Mortgage Pre-Approval, 1st download our app to be one of the best free tools for Pre- Qualification https://www.dlcapp.ca/app/angela-calla?lang=en

  1. Know Your Budget:

Mortgage pre-approval gives you a clear understanding of how much you can afford to spend on a home. This knowledge ensures that you focus your search on properties within your budget, preventing wasted time on homes that may be out of financial reach.

 

  1. Increased Negotiating Power:

Sellers are often more inclined to negotiate with buyers who have a mortgage pre-approval. It demonstrates to the seller that you are a serious and qualified buyer, increasing your chances of securing the property.

 

  1. Avoid Disappointment:

Imagine finding your dream home only to realize it’s beyond your financial means. Mortgage pre-approval prevents this heartbreak by setting realistic expectations and allowing you to explore homes within your price range.

 

How to Get Pre-Approved for a Mortgage

  1. Gather Financial Documents:

Prepare key financial documents, including proof of income, employment verification, credit history, and information about your debts and assets. Lenders will use this information to assess your financial stability.

 

 

  1. Submit an Application:

Fill out a mortgage pre-approval application with your chosen mortgage broker. Be thorough and accurate in providing the required information. The more detailed and precise your application, the smoother the pre-approval process.

 

3. Wait for Approval:

Once your application is submitted, the lender will assess your financial situation and creditworthiness. If approved, you will receive a pre-approval letter outlining the maximum loan amount you qualify for.

 

Advantages of Mortgage Pre-Approval When Shopping for Your Dream Home

  1. Focused Home Search:

Armed with a pre-approval, you can focus your home search on properties within your budget, saving time and ensuring a more efficient process.

 

  1. Confidence in Bidding:

When you find the perfect home, you can confidently make an offer, knowing that you have already secured financing. This positions you as a strong and reliable buyer in the eyes of the seller.

 

  1. Quick Closing:

Pre-approval expedites the mortgage application process when you find the right property, allowing for a quicker closing timeline. This can be advantageous in competitive real estate markets.

 

Conclusion:

In the dynamic world of Canadian real estate, mortgage pre-approval stands out as a key tool for savvy homebuyers. By understanding its importance, following the steps to obtain pre-approval, and leveraging its advantages in your home search, you set the stage for a successful and stress-free homebuying journey. Consider reaching out to professionals like the Angela Calla Mortgage Team to guide you through the pre-approval process and ensure that you are well-prepared to turn your homeownership dreams into reality. With mortgage pre-approval as your key, unlock the doors to your future home with confidence and peace of mind.

Angela Calla is an 19-year award-winning woman of influence which sets her apart from the rest. Alongside her team, Angela passionately assists mortgage holders in acquiring the best possible mortgage. Through her presence on “The Mortgage Show” and through her best-selling book “The Mortgage Code“, Angela educates prospective home buyers by providing vital information on mortgages. In light of this, her success awarded her with the 2020Business Leader of the Year Award.

Angela is a frequent go-to source for media and publishers across the country. For media interviews, speaking inquiries, or personal mortgage assistance, please contact Angela at hello@countoncalla.ca or at 604-802-3983.

Click here to view the latest news on our blog. 

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