Congratulations – you are moving into your new home! Whether you are starting with a plain new build or an older resale home, there’s no better way to make it yours than by putting your stamp on it. Invest a weekend or two into warming up a featureless space or refreshing someone else’s old homestead. It’s easy with our 10 steps to home sweet home.

Step 1: Change the locks
Secure your home by changing the locks as soon as you take possession.
Even DIY beginners can change a deadbolt lock. A replacement deadbolt set can be installed in place of the current lock – no drilling required.

Another alternative is to rekey the lock. Purchase a rekeying set from the same manufacturer as the existing door lock, and reset it for a new key.

Step 2: Get a professional deep cleaning
Hire professional cleaners to deep-clean and detail your home before you move your possessions in. Without any furniture to work around, they’ll have access to every nook and cranny. Yes, you’ll have to clean again after moving day, but the heavy lifting (scouring, scrubbing and scraping) will have already been done!

Step 3: Clean the guts of your home
Years of dust, pet dander and detritus collect in the mechanicals of any home. One of the most effective ways to refresh a resale home is to get right into the guts of it: the mechanicals. Have your ducts, furnace and air conditioning unit professionally cleaned. Change the filters as required to maintain that clean, fresh air.

Step 4: Apply a fresh coat of paint
Painting provides the most bang for your home improvement buck. Whether the walls of your home are dingy or you’re simply not feeling the magic of “beige,” it takes just hours to repaint your space with a colour that makes your heart sing.

Step 5: Freshen up the floors
Worn out floors can put a damper on that new-home buzz.
If your hardwood has seen better days, hire pros to refinish it, or tackle the project yourself by renting a floor sander and varnishing over a weekend.

Steam-clean wall-to-wall carpet and clean laminate flooring with special laminate floor cleaners, although if either is too far gone, you may want to replace it.
Personalize your space while protecting your floors by adding area rugs and runners throughout your new home.

Step 6: Neutralize any odours
Resale homes, particularly fixer-uppers, can come with lingering smells. Steps 2, 3, 4 and 5 will dramatically reduce any unpleasant odours. Stubborn odours require spot treatments, such as the following:

• Put dishes of activated charcoal, also called activated carbon (available from aquarium stores), in musty, damp basements. Run a dehumidifier during the spring and summer.
• Place a sock filled with dry coffee grounds or baking soda in closets, refrigerators or freezers to absorb stale odours.
• Pour white vinegar down a stinky drain.

Step 7: Give your windows a new view
Dirty windows and screens can make rooms feel dingy. A thorough cleaning will have your windows shining, and your indoors will feel brighter and fresher, too.

If your home came with the previous owner’s window coverings, be sure to clean or launder them (it’ll remove allergens as well as reduce any lingering odours). Or consider replacements more specific to your design tastes.

Step 8: Brighten your lights
A well-lit home feels inviting and warm. If your rooms feel dim, replace the existing bulbs with bright, energy-saving CFL bulbs. Dated lighting fixtures can foil your redecorating efforts, so consider replacing them. You can donate them to a Habitat for Humanity ReStore shop – after all, your taste may be urban-contemporary, but someone else may be looking for the perfect retro pendant!

Step 9: Replace the switch plates
A screwdriver is all it takes to swap out lighting switch plates. This easy change gives an instant lift to any room. With a little DIY expertise, screwdrivers, pliers and a voltage tester, you can install energy-saving dimmer switches, instead.

Step 10: Display your art
Finally, dress up your walls with your favourite artwork and family photos. Get your kids’ kindergarten masterpieces onto the fridge, and deck out your mantel with family photos.

There’s a reason why we remove personal photos and mementos when selling a house: it’s so potential buyers see a clean slate. Now that you’re in your own home, go wild and make it yours! And if you have any questions, please contact your local Dominion Lending Centres mortgage specialist.

Marc Shendale
Genworth Canada – Vice President Business Development

Emotional Homebuyers Can Lose Out On the Best DealsBuying a home is financial decision, but also an emotional experience.

Before we’ve explored every room, we often start imagining our new lives there. Where our furniture will go. The parties we’ll host in the open-concept living-dining space. The mornings we’ll spend at the breakfast bar overlooking the garden or skyline… When a home speaks to us emotionally, the fear of missing out on it can set in fast.

That’s especially true in a real estate market where multiple offers and bidding wars are common, where a financing condition can put you at a disadvantage, and where prices are at all-time highs.

According to the 2017 Genworth Canada Homeownership Study, 60% of first-time buyers were worried they might miss out on the “perfect” house. That can lead emotional homebuyers to act against their own best interests by, for example, forgoing important conditions, or paying more than they had budgeted.

There’s no need to lose the dream — you will host those parties — but you’ve got to take emotion out of the deal, and these strategies will help.

Assemble your entire team before looking at any property.

That means: interview experienced real estate agents with expertise on your desired neighbourhoods; consult a financial advisor to help determine how homeownership fits into your other goals (a wedding, saving for a child’s education, retirement planning, etc.) and establish a budget including “what-if” scenarios, such as a layoff or maternity leave; find a DLC mortgage broker to help you secure a pre-approval, explain your options, and answer your questions here. You may be able to achieve homeownership sooner than you think. Find out how

Get the names of 3 home inspectors. Call and introduce yourself now.

Many emotional homebuyers forego the inspection process in an effort to make their bid more competitive. That’s a risk. With 3 recommended inspectors on speed dial, you should be able to get a qualified professional to visit a property the day you want to make an offer. Your real estate agent is one source of referrals, or check with the Canadian Association of Home and Property Inspectors.

Don’t visit properties outside your price range.

Best-case scenario, you’ll walk away deflated. Worst-case scenario? You’ll bid on something you can’t comfortably afford. Stick to your homeowner budget (likely to be higher than renting, since it includes property taxes/maintenance fees, utilities, etc.) and practice living on it for a few months before you decide to make a purchase.

Focus on the things you can’t see.

The efficiency of the heating and cooling systems, the age of the roof, the state of the electrical… these matter most when it comes to deciding if a home is a good financial deal. Hardwood floors, quartz counter tops, and stainless steel appliances can be seductive, but they shouldn’t be a priority.

Surprise repairs and upgrades to fundamentals — like a furnace on its last legs, plumbing that isn’t to code, or uninsurable knob-and-tube wiring — could sink your budget. And if problems have been covered up, you might just have to rip out those magazine-worthy finishes and details.

There is no disputing that buying a home is a massive financial decision as well as an emotional experience. But minimizing emotions throughout your homebuying experience is a heads-up move that will ultimately benefit you.

For more tips on what you should know before you purchase a home visit www.homeownership.ca.

Marc Shendale
Genworth Canada – Vice President Business Development
Apr 15th, 2015 | Posted in: Chief Economist, News.

Over the years, I have come across all sorts of people who have had no idea what their credit score is. Some of them have declared to me that they have great credit only to find that they had poor credit scores or a number of late payments. I have also had people tell me that they had lousy credit only to find that they had a very respectable credit score. People do not know anything about credit and need an expert to help them to build their credit.

When you ask the two major credit reporting agencies, Equifax and Trans Union how they score credit, they give you a vague idea but no idea on how to quickly up your score.

Perhaps you have seen this pie chart that shows how they score different activities I have found out recently that people have higher scores that they had previously and this is due to more emphasis on what you owe now as opposed to your payment history.

Here are some things I have observed over my 12 years of being a mortgage broker.

1- Credit card balance. If you have a credit limit of $1,500 and your balance is at $1,450 you are losing 25-30 points. Having a balance of $0 or using less than 50% of the limit adds points. If you pay the minimum balance you may go over your limit. If you are over your credit limit by $1 you will lose 35 points !

How do you quickly get your score up in this situation? Call your credit card company and tell them that you have a large purchase coming up. Ask them to increase your limit to $2,500. They won’t give you a decision over the phone but often within a week you will receive notification that your balance has been increased. You now have an extra 25 points with one phone call. You can also ask them to lower your interest rate so that you can pay your balance down quicker. Most people don’t realize that credit card companies will do this. You can also move your credit card balance over from a high interest department store card at 26% to a lower interest bank card at 9.95%.

2- Types of credit used – credit agencies want to see proper usage of revolving credit ( i.e.: credit cards) and installment credit (i.e. car loans) . They also want to see that you have over $2,500 in available credit. You probably have a credit card but you may not have an installment loan showing on your credit report. You don’t have to buy a car to get this showing on your report. Consider getting a $1,000 RRSP loan from your bank. Why? Well, $1,000 is a substantial loan. Your bank or credit union will be more willing to lend you money for an RRSP that you may buy from them than they would lending you the money for a gambling junket to Vegas.

The RRSP loan is a win/win for you. Besides increasing your credit score and thickening your credit file you will get a tax refund at the end of the year which can be used towards your down payment. 90 days after you open your RRSP you can use the money towards your down payment under the Home Buyers Program up to a maximum of $25,000.

Credit history – don’t close the old credit card you got in university just because you aren’t using it.

Chances are that this card is still reporting month after month that you have credit with them and that the balance for that month is $0. Finally this brings me to my best tip for building credit.

Payment History – Recently I had a young client who wanted to renew his mortgage. When I obtained his credit report I was surprised to see that he had a 900 credit score. This is the highest score possible and usually it is reserved for older people with 20+ years of credit history. When I asked him how he managed this he told me that the only thing he does differently is that he checks his credit card balance every week and pays it off to $0. I knew that people who paid bi-weekly often had higher scores from having more payments showing in their history but this was the first time I had ever heard of someone paying weekly. I am not certain if it’s the number of payments, the fact that the balance is $0 so many more times or a combination of the two factors.
Recently, using these techniques I was able to raise a client’s credit score by 60 points in one month.

If you want to buy a home and you suspect your credit is weak, your first call should be to a Dominion Lending Centres mortgage broker. They can check and make suggestions to get your credit score up and to get you into a home a lot sooner than you could do this on your own.

David Cooke
DAVID COOKE
Dominion Lending Centres – Accredited Mortgage Professional

AVOCADO TOAST & BUDGETING

There was an article reprinted in the National Post recently about an Australian millionaire’s opinion on millennials not being able to afford a home because they’re wasting money on avocado toast, at $22 per plate. The article was quickly mocked but it was an interesting article on two fronts: 1) the irresistible urge for avocado toast and 2) the importance of budgeting.

In no way is this a critique on millennials themselves, but a reminder for all to understand how spending money today, may prevent us from saving for tomorrow.

The comments arose from a TIME interview with the millionaire about how he did not spend his money on avocado toast and $4 coffee, multiple times a day, when he was young. Surely times have changed since said Australian millionaire was young and he had other priorities at the time – which may not have included avocado toast. However, what he is trying to drive home, is the importance of budgeting.

For those that are trying to save money for a down payment on their first home, it is important to think about living within your means. Perhaps those trips to the coffee shop and Sunday brunches could be fewer per month to help save a few hundred dollars a month.

If you are spending an average of $4 per coffee at your local café on your lunch hour or coffee break at work, that could add up to approximately $80 per month. For many, those coffees are added to their credit cards where only the minimum payment is made at the end of the month. As such, those $80 per month have increased to more than 99$ at a 24% interest rate (and continues to compound over the months you carry your balance). For those few who pay off their credit card before the end of the month, even saving an extra $80 per month can add up to a pretty solid down payment on a home over months and years.

Today, we are more prone to instant gratification and those coffees and avocado toasts may seem like harmless frivolities that don’t amount to much. However, every little bit counts when planning for your future. I often tell people that today’s non-essential purchase is a hindrance to their future home which helps puts things into perspective for them – and serves as a catalyst to saving.

Budgeting is essential when looking to buy your first home. This includes looking for a home and mortgage solution that work best within your monthly budget. For example, if you are earning $4,000 per month, it would be ill-advised to have mortgage payments that nears $2,000. Perhaps a starter home is all you need which will allow you to invest in your home, grow your equity and then use that for your next home in a few more years. Do you need that 2,500sq foot home right away, or can you live in a 800sq foot home for a few years before moving into a bigger place?

Making the right financial decisions can be difficult for many families. As a mortgage broker I have seen many people struggle trying to buy their first home and invest for their future. Luckily, though, I have also been able to work with them to find mortgage solutions that make sense for their very personal financial situations.

Should you need help securing a mortgage for your first home, please contact your local Dominion Lending Centres mortgage specialist.. In the meantime, ease up on the avocado toasts and $4 coffees.

MAX OMAR
Dominion Lending Centres – Accredited Mortgage Professional
Max is part of DLC Capital Region based in Edmonton, AB.

When you apply for a loan, lenders assess your credit risk based on a number of factors. Your credit score, as well as the information on your credit report, are key ingredients in determining whether you’ll be able to get financing and the rate you’ll pay. To get approved for a loan and to pay a lower interest rate it’s important that your credit report reflects that you’re a responsible borrower who pays their debts on time with a low risk of defaulting.

Credit Report vs. Credit Score

To start with, it’s important to understand that your credit report and your credit score are two separate things.

Credit Report – Your credit report contains information detailing your credit history. Sources include lenders, utility companies and landlords. This information is compiled by one of two major credit-reporting agencies (Equifax and TransUnion) that try to create an accurate picture of your financial history. Credit files include information such as:

• Name, address and social insurance number
• Types of credit you use
• When you opened a loan or line of credit
• The balances and available credit on your credit cards and other lines of credit
• Information about whether you pay your bills on time
• Information about any accounts passed to a collection’s agency
• How much new credit you’ve opened recently
• Records related to bankruptcy, tax liens or court judgments

Errors on your credit report can reduce your score artificially. In fact, 1 in 4 consumers have damaging credit report errors. Therefore, it’s important to stay up-to-date on your credit report history. If there is an error, you should dispute it and get it removed as soon as possible. Last year, 4 out of 5 consumers who filed a dispute got their credit report modified, according to a U.S. study by the Federal Trade Commission.

Credit Score – Your credit score is the actual numeric value extrapolated from the information in your credit report. A credit-reporting bureau applies a complex mathematical algorithm to the information in your credit file to create your numerical credit score.
Beacon is the most widely known credit scoring formula in Canada and is used by many creditors. Your FICO score can range from 300 to 850, with under 400 being very low and 700+ putting you in the healthy range. Your credit score is meant to give potential lenders an idea of how big of a financial risk you are. The higher your score, the less likely you are to default or make late payments and the more likely you are to be approved for financing.

Your score is based most strongly on three factors: your payment history (35% of your score), the amounts owed on credit cards and other debt (30%) and how long you’ve had credit (15%).

What Are They Used For?

Lenders glance at your credit score to determine your credit risk. Most traditional lenders have pre-set standards. If your credit score is within a certain range, they’ll offer you certain credit terms. If you don’t fall within their approved range, then you may be denied. Most banking institutions will only approve a loan if the client has a credit score of at least 640. A score of 700, however, gives you a much better chance at gaining approval at most lending institutions and at reasonable rates.

As far as interest rates are concerned, banks use an array of factors to set them. The truth is they are looking to maximize profits for themselves and shareholders. On the other hand, consumers and businesses seek the lowest rate possible. A commonsense approach for getting a good rate would be having the highest credit score possible.

It’s important to note that if you apply for a loan, the lender will most likely pull your credit score through what is commonly called a “hard inquiry” on your credit, which slightly lowers your credit score. Therefore, it’s important to know your credit score ahead of time, fix any errors, and apply for loans which you have a good chance of being approved for.

Things You Can Do to Improve Your Credit Score

1. Check your credit report for errors – While the credit agencies do their best to keep your record free of errors, they can make mistakes. It’s important to check your credit report at least once a year — consumers are entitled to one free credit report every 12 months — to ensure all of the information is correct. Each agency may have slightly different information and, consequently, may have errors another credit report doesn’t.

2. Set up payment reminders – Making credit payments on time is one of the biggest contributing factors of your credit score. It may be helpful to set up automatic payments through credit card or loan providers so you don’t forget to pay when payment is due.

3. Reduce the amount of debt you owe – Stop using your credit cards. Use your credit report to make a list of all your accounts and check recent statements to determine how much you owe on each account and what interest rate they’re charging you. Then create a payment plan to lower or eliminate the debt you still owe.

JENNIFER OKKERSE
Dominion Lending Centres – Director of Operations, Leasing Division

OUTSIDE THE BOX

From the pages of the summer edition of Dominion Lending Centres’ Our House Magazine.

For most Canadians, a home comes in just a few different varieties. It’s either a single-family wood frame house, townhome, condo or high-rise. In the quest to find less expensive housing, alternatives to the conventional home were bound to get serious traction. From container homes to tiny homes and even the centuries-old design of a yurt, Canadians and Canadian manufacturers are starting to look at the home in an entirely different way.

Daniel Croft is the vice president of Giant Container Services, a Toronto company that’s been converting shipping containers into places to live since the beginning of the decade. The company has its roots in the trucking industry. In the early 2000s Croft’s grandfather started noticing these containers being used for storage. The company bought 100 and after a few years, a new division was born to turn the containers into homes. Since then, Croft noted business has been brisk.

“We’re seeing a huge interest in container homes,” he says, noting some of the company’s projects include condominiums built out of hundreds of containers. However, he noted at this point, most of his clients are using the containers as a vacation property home.

Giant Containers offers four to five different models ranging from 320 to 1,000 square feet at a cost $85 a square foot.

While the containers are basically just a prefabricated steel structure, Croft says they’re built like a house, and include electrical and plumbing like a traditional build.

He says his company also helps guide owners through the process of erecting the containers.

Croft sees the prefabrication of living structures, like containers, as the future of home ownership, noting they can be transported at low costs and can last longer than a conventional wood frame home.
“Our demographic knows they want to be in a container house, they like the look and feel of it and the sustainability aspect,” he says, noting his customers range in age from millennials to couples in their 40s. “This is something I’ve really been behind… I really do think this is the future of building.”

Across the country in B.C., Nomad Micro Homes is also seeing a surge of interest in its product. The company offers two types of micro homes, the most popular being its 156-square foot Nomad Cube, which also comes with a 100-square foot loft. The Cube will set you back about $32,000.
The company’s founder and CEO, Ian Kent, describes the product as a “do it yourself” kit home, similar to something you’d buy in Ikea that can be put together very quickly. While they may be simple, he notes people can live in them as a primary residence. Nomad’s homes also aren’t on wheels, like some versions of tiny homes.

The company sells about 20 to 30 of their homes a year, but the company can increase scale to produce thousands of units if needed. Kent sees the tiny home as one answer to a rental supply crisis gripping B.C.’s Lower Mainland.

“It’s an extremely low-impact backyard dwelling,” he said. Nobody cares about it, you’re not going to bother anybody with it, and you’re going to provide the most affordable housing in the Lower Mainland.”
Indeed, cities and governments are starting to recognize and consider these less typical ways to live.

In 2016, the City of Vancouver put out a request for proposals to build 300 containers for temporary housing for the homeless. The city has also led the way in approving laneway homes.

Avi Friedman, a professor of architecture at McGill University in Montreal, believes the shrinking size of the home is a reflection of the economy—building larger homes costs more—and a change in demography as families become smaller.

He suggested buyers want bigger homes to start with, but when millennials especially enter the market, they’re just not able to afford the size of dwelling their parents owned.

In the past, Friedman notes, many people’s first home was a single family house, but today most people begin their adult life in an apartment.

“We are now living in a time where there are so many critical changes,” he says.

While the professor agrees these alternative homes can help alleviate the housing pressures in areas like Toronto and Vancouver, he wouldn’t want to see tiny homes in all communities. Instead, he sees these homes integrated among a range of housing options.

Friedman also called on municipalities to be innovative, allowing for flexible designs to address the housing issues.

“What municipalities can do is revisit archaic bylaws that have been introduced in the 1940s and ’50s and see how they can be readjusted to current economic and social reality,” he said.

But if the container or tiny home isn’t your thing, there’s a centuries-old way of living to put you more in touch with nature. The yurt design is essentially that of a circular tent. Patrick Ladisa, the president of Yurta, a yurt manufacturer in Toronto, says he’s always been interested in minimalist architecture and, in 2004, his company built its first yurt, meant to be used as relief shelter.

“It really was a cost-effective living shelter. That was our core market for years,” he explains.

The company makes three sizes of yurts, the most popular being 17 feet in diameter with a price range between $7,500 to $20,000, depending on options. Some of those options include windows and a solid door. What you won’t likely see is much indoor plumbing. Ladisa noted the attraction to the yurt compared to the container or tiny home is a desire to be close to nature and a connection to the outdoors.

However the business has evolved into the recreational market for people using the structures as a guest space at a cottage, or in place of a cabin in the woods. The small company with six employees expects to sell out of its yurts for the year by the summer. Customers come from across the country.

“The cost of housing is increasing and finding a way to live inexpensively or have a livable shelter that’s cost-effective… but still has dignified living, that’s a key part for us,” Ladisa says.

JEREMY DEUTSCH
Lead Writer

Mortgage rules have become stricter over the past few years. Assuming you have a down payment, good credit and a good job, what could prevent you from obtaining financing for a home purchase?

Below are five less obvious reasons a bank may turn you down:

It’s not you, it’s the building

Hate to be the bearer of bad news, but even if you’re the perfect candidate for a loan, you can still be rejected by a lender if the building you’re considering flunks a bank’s requirements. There are myriad reasons a building can be rejected, but one possible reason could be the building construction or condition.

In downtown Calgary we have some condos that were built in the 1970’s using a technique called Post Tension. It has been discovered that the steel rods in the walls can corrode over time and the buildings could collapse. Some lenders are okay with an engineer’s report but others won’t consider lending in this type of building. A few years ago a condo was found to have water seeping down between the inner and outer walls from the roof. This resulted in a $70,000 special assessment for each condo owner. Before the problem and the cost were assessed most lenders refused to lend on this property.

If a condominium building does not have a large enough a reserve fund for repairs a lender may want to avoid lending in that building as well.

Your credit doesn’t make the cut

If you have a credit score of 680+ this probably won’t be a problem for you but for first time home buyers with limited credit this can be a major stumbling block to home ownership. Check your credit score before you start your home search.

Not having enough credit can also be a problem. If you have a Visa card with a $300 limit, that won’t cut it. A minimum of 2 credit lines with limits of $2,000 is needed; one revolving credit line such as a credit card and an installment loan such as a car loan or a furniture store loan.

A long forgotten student loan or utility bill from your university days can also cause problems if its showing as a collection.

You’re lacking a paper trail

You have to be able to show where your money comes from. A cash gift of the down payment for your new property without a paper trail isn’t going to fly with the bank. If it is a gift, we need to see the account that the money came from, a gift letter from a family member, and the account the money was deposited into.

Your job

Being self-employed or a consultant comes with its own set of obstacles. But the solution here, too, is about documentation. And be prepared to offer up more documentation than someone with a more permanent income stream. Two years of Notices of Assessment from the CRA will show your average income over a two-year period. This could be a problem if your business had a slow start and then really picked up in year two. The two-year average would be a lot lower than your present income.

Another stumbling block may be how you are paid. Many people in the trucking industry get paid by the mile or the load. Once again a two year NOA average should help.

In Alberta, many people are paid northern allowances, overtime and a series of pay incentives not seen in other industries. This can be a problem if you do not have a two-year history.

When you apply for a mortgage you need to stay at your position at least until after your home purchase is complete. Making a job change with a 90 day probation means you will need to be past your probation before the mortgage closes. If you make a career change , you may need to be in your new industry for a least a year before a lender will consider giving you a loan.

The property’s appraisal value is too low

This often happens in a fast moving market. The appraisers base their value on previously sold homes on the market in the last 90 days. If prices have gone up quickly your home value may not be in line with the appraisers value. If the home you want to purchase is going for $500,000 and the appraised value is $480,000, you have to come up with $20,000 PLUS the 5% down payment in order to make the deal work.

Finally, with all the potential problems that can arise, it’s best to contact a Dominion Lending Centres mortgage broker before you start the home search to make sure that you have your ducks in a row.

DAVID COOKE
Dominion Lending Centres – Accredited Mortgage Professional

Every year since October 2008 it’s become more and more difficult to obtain a mortgage. The government claims to be casting a safety net over the Canadian housing industry via stiffer mortgage regulations. What do you need to know to help prepare yourself for a home purchase, refinance, debt consolidation, or even a simple renewal? Well the biggest item I cover on a daily basis is preparation.

It can take a client weeks or months to find the confidence to connect with a Mortgage Professional once they feel confident that they ready to obtain that next mortgage. Any Mortgage Professional worth their salt will be able to guide their clientele to prepare them properly for the mortgage.

Typically most people think they need to prepare themselves most for their first purchase, however preparing for each mortgage these days is more critical today than ever before. When Canadians finally make that call, they want a step by step process to solve their solutions in an easy manner, but are seldom prepared to proceed.

During my regular daily routine, I follow up with my clients with gentle reminders to send me the requested documentation list. Having done this for ten years, the process is quite similar for almost each individual even though the main list of documentation remains the same.

We all want to take short cuts to get to the finished product, but in the end, the banks and lenders have become governed so much so that the short cuts are almost non-existent therefore, preparing the proper document package is essential to an essential mortgage. As Arnold Schwarzenegger said recently in an interview I watched on Facebook, we need to stop taking and thinking about short cuts. There aren’t any to success.

What I’m getting at here is that when your Dominion Lending Centres Mortgage Professional provides you with a mortgage document checklist, please don’t take it for granted, please follow each and every step carefully.

In general, the most common documents required are dependent on what you do for work. So if you are an employee, then the most recent paystub, and an updated employment letter along with the most recent two years of T-Slips (whether they are T4’s from employer’s, T5’s and pension slips), T1 Generals -the entire document (the documents your accountant prepares to submit to Canada Revenue Agency), Notice of Assessments (the form you receive back from CRA after your file is completed). Then there will be the verification of down payment via 90 days of bank statements, any mortgage statements, property tax assessments and the list can go one. The most common mistake is providing a mix and match of the above documents to try and piece together your income story. Depending on how your income is structured, we may be able to provide you with a near pre-qualification but lenders are being more adamant of having the documentation upfront, so that they are using their time, along with the mortgage insurer’s time. As a rule of thumb, the cleaner the file, the easier it is to underwrite and make a proper decision.

Common mistakes include, missing pages from tax documents, poorly written, unsigned, undated, missing info on employment letters (handwritten ones draw huge red flags), cut off pages from documents, out dated items(paystubs and employment letters over 30-60 days is pretty much null and void these days).

You may not know how to prepare yourself, but that’s also what we are for. We are essentially mortgage guidance counsellors to help prepare you for mortgage success, but if we are trying to obtain a mortgage via shortcuts, you’ll be upset with how the process goes.

We all used to have more leeway with mortgage documentation, but it’s clear the government is having banks and lenders scrutinize every mortgage more carefully now than ever before. And the banks and lenders have to oblige as they will be audited, if they don’t pass audits, then they lose out. And if they lose out, we lose competition. Yes this is the new normal, yes it’s tiring, no we don’t like it either, but it’s our new reality. And realistically, is gathering a few extra documents really that bad? Mortgages are not a given right and earned more so than ever before in our recent history.

Our job is to help you prepare for the mortgage, sometimes it will take one meeting, sometimes it’ll take weeks or months, even years depending on your own personal financial situation. But we can provide the recipe to help you prepare, but it’s up to you to do the cooking.

JEAN-GUY TURCOTTE
Dominion Lending Centres – Accredited Mortgage Professional

HOW TO SHOP FOR A MORTGAGE

For many people, a home will be the largest purchase of their life. It stands to reason then, that when you are shopping around for your mortgage you will want to take certain steps to ensure you are getting the sharpest rate and best product. We have a few pointers to make you a savvy shopper when you are out looking at different mortgages—get ready to take a few notes.

1. Do not always rely on the bank for the sharpest rates
Mortgage Brokers can often beat the bank rates by using different lenders. They can also often get you a SHARPER rate at your own bank simply because of the high volume that they do with them. Brokers have access to a number of different lenders giving you more options for not only the best rate, but also the best product for YOU.

2. Know your credit score
Your credit score is a large factor in your mortgage application. You need to know where you stand with your credit BEFORE you begin the process of shopping. All lenders will look at your credit history and score first then they build a file around that. A mortgage broker can obtain your credit score in mere minutes-all you have to do is ask.

3. Make it a one-stop shop
Avoid shopping from institution to institution. You may think that more options lead to better rates, but in fact lenders will frown upon you having your credit score pulled multiple times. This is where the benefits of using a broker come into play. They will pull your score ONE time only and use that to shop around with lenders for you. Really, it’s like having your own personal shopper!

4. Understand that the market will change.
Starting the shopping process knowing that the market you qualify in TODAY will adjust is key. Rates might be low right now, but new rules and implications can change things when you are up for renewal. Understand that you MUST be able to carry your mortgage payment on at a higher rate if new laws are put in place.

Keeping these 4 Savvy Shopper tips in mind when you are shopping for a mortgage can help set you up for success not only today, but for the future as well. Mortgages are not only about finding the best rate-but finding the best product too. A Dominion Lending Centres mortgage specialist can work with you and your unique situation to find you the best product for you—and as an added benefit do the shopping for you!

GEOFF LEE
Dominion Lending Centres – Accredited Mortgage Professional

You have a family member that doesn’t qualify for a mortgage on their own and needs a co-signor. Since you’re a nice person, and of course would like to see your son/daughter/parent/sibling in a better position, you agree to co-sign for the mortgage.

If I had a dollar for anytime I’ve heard the phrase “but I’m only co-signing right, they can’t come after me for the money or touch my house?” I’d be rich!

There are many common myths around co-signing. Here’s only a few and the truths associated with each one…

I’m only co-signing for my family member to get the mortgage and that I won’t have to ever make payments. False: You are equally responsible for making the payment on the mortgage. If the borrowers default, you will be required to pay.

I can’t be sued for non-payment since it’s not my mortgage. False: The lender has all legal collection methods available to them to collect payment from you, including obtaining judgment in court and possible garnishment of wages and bank accounts.

The bank can’t take my house if the borrower loses theirs. False: As per the second myth above, judgment action can also involve seizure and sale of any of your assets including and not limited to your own home.
I’m only a co-signor or a guarantor so I’m protected from not having to pay. False: Whether you are the borrower, co-signor, or guarantor, you are fully responsible for the debt.

Co-signing on this debt won’t affect my ability to obtain credit in the future. False: Not only will you legally have to declare the co-signed debt when you apply for credit, but also most lenders in Canada are now reporting to the credit bureau and it will appear when you apply. Either way, the mortgage payment must be factored into your debt service ratio.
Since this is only a five-year term, I am automatically released from this mortgage in five years. False: Regardless of term, you remain on the mortgage until it is paid in full or released only with approval from the lender.

Here’s a few tips and questions to ask before agreeing to co-sign on a mortgage…

Know the borrowers’ situation. What is there credit like? Are they drowning in debt? Why exactly is a co-signor required?
Is there an exit strategy to have your name released and how long will that take?

Add your name to title of the property so that the borrower cannot add a second mortgage to it. This is an asset that you have an interest in and therefore should protect it.

Get independent legal advice about your obligations as a consignor.
Be prepared to make the mortgage payments of the borrower doesn’t.
Don’t be afraid to say no to co-signing if it doesn’t feel right.

Knowledge of the borrowers situation, your obligations, and potential ways to protect yourself (and of course setting emotions aside) is the best advice for anyone co-signing. And if you have any questions, please contact your local Dominion Lending Centres mortgage specialist.

SEAN BINKLEY
Dominion Lending Centres – Accredited Mortgage Professional
Sean is part of DLC Key Mortgage Partners based in Kingston, ON.