Almost all mortgage companies and banks will have the option to allow you to make payments weekly or bi-weekly. There are two very good reasons why you should consider this.. Firstly you will pay off your mortgage sooner with accelerated payments, but could mean you will have higher payments. Secondly, if you are paid weekly or bi-weekly it makes it easier for you to budget paying your mortgage, as you can line up your payment with the dates that you receive your pay cheque.

Making Extra mortgage payments

If you have the spare cash making extra mortgage payments can save you huge amounts of interest. When you select your mortgage company or bank, as them about the option of making extra payments. If you are allowed to make extra payments of say 25% this will allow you to make additional payments of up to $25,000 per year on each $100 000 of mortgage. It is also important to make sure that your bank or mortgage company allows these additional payments to be flexible, so that you can make payments of smaller amounts when you can afford it, this will again reduce the term of your mortgage and in turn mean that you pay less interest.

Reducing the CMHC fees on your purchase

When you require a mortgage in Canada for more than 80% of the purchase price of a property, that mortgage must be insured by Canada Mortgage and Housing (CMHC) or GE Mortgage insurance. The premium charged by both of these company`s decreases as the down payment increases. But if you can put down 20% of the purchase price, you can avoid any additional insurance fee whatsoever. Depending on your situation there are ways that you can structure this financing to avoid the CMHC or GE insurance premium.

Advantages of Bigger Down Payments

As mentioned above, when you put a 20% down payment on your purchase you can avoid the CMHC premium in Canada. However more importantly the larger the down payment, the lower the amount of interest you will pay over the life of your mortgage and the lower amount you will be paying monthly. But please remember, do not stretch yourself to increase your down payment and end up borrowing on credit cards or a line of credit at a higher rate, as this will mean you will be paying higher amount of interest on these amounts and maybe up to 4 or 5 times the current mortgage interest rate.

Short Term Rates vs. Long Term Rates

The rate options for mortgages available can be very confusing for most mortgage shoppers. Terms for mortgages vary between variable and fixed rate, 6-month terms to 10 year terms and even longer in the US. By taking a variable or floating rate mortgage you can make savings. Typically the shorter the term or guarantee of the rate, the lower the rate will be. However, this does not always happen, depending on the market place and the economy, but history has shown that short-term rates tend to be lower than long-term rates. The up side of variable rate is the strong potential for interest rate savings. The down side is the fact that you are accepting the interest rate risk without a guarantee, but today many companies will let you lock in at a rate further down the road. If you are considering a variable rate mortgage you need to look at your own risk tolerance. Considering projections of rates and where we see interest rates heading can also be important in this decision. Make sure you talk to an expert when you are making this decision and shop around, mortgages rates do vary and the rate displayed is often not the best rate available.

Walking through your potential home can be so exciting, that it’s easy to forget some details. Was there a bathroom on the main floor? What shape was the roof really in? If you are looking at a number of homes, it can very easy to confuse the features of one home with the features of another. Take this checklist with you to help you remember details and the positives and negatives of each home. When it comes time to review, you’ll be happy you did.

You are probably thinking, “Well I have an agent”. But do you really? Did you know that by default ALL Real Estate Sales Representatives work for the seller? You might think that the agent who is showing you all of those homes is working for you, but they aren’t! That is unless you have an agreement in writing with them stating that they are representing your interests.

Read below to learn more about what a Buyer’s Agent is and why it is important that you have one.

Why is it important for home buyers to use a dedicated “Buyer’s Agent” when purchasing a home?

Most likely, unless you’ve bought real estate south of the border, “Buyer’s Representation” is a new concept for you. Buyer’s Representation (or agency as some people call it) is common in the US, but is relatively new in Canada.

Think of me as your own personal shopper & negotiator for real estate, who can take you to virtually every “store” in the area to find you just the right place — and when you find it, I negotiate hard on your behalf to get it at the best price and terms for you. Best of all, my services don’t cost you a penny extra (except in a very unique instance, see How I Get Paid, below).

Below are some answers to questions typical questions people often have about Buyer’s Representation

1) Are you a “regular” real estate agent?
Yes. I am a licensed Real Estate agent in the province of Ontario, Canada. As a Realtor, I have full access to the MLS which means I can show and sell every property listed on the MLS by other Realtors here in Ontario.

2) How do I get paid?
In most cases, I’m paid a portion of the sales commission that is paid to the listing Realtor. This forms part of the fees paid by the seller of the property

3) Is there a conflict of interest if I’m paid a straight percentage of the sales price?
No. Remember as a Buyer’s Agent my legal and ethical responsibility is with you NOT THE SELLER. At first glance however, it may appear that if I’m paid a percentage of the sales price, that would motivate me to get you to pay the highest price possible for the house. But first, consider the money involved. A 4% commission on $10,000 (the difference between, say a $170,000 sales price and a $180,000 sales price) is $400, which, in the big picture, is very little. In the long run, I’m going to make a lot more than that extra $400 if you’re a happy client that refers other buyers to me.

4) What are the benefits of working with a Buyer’s Agent versus a traditional seller’s agent?
The obvious, of course, is that I represent, you, the Buyer, and not the Seller. But there are a number of other advantages.

No Property Bias While listing agents certainly can show you anything that is Multiple Listed by other agents, there is a financial incentive to them to show you their own listings first. If they sell you one of their own listings, they earn a bigger commission.

Unbiased Opinion of Properties Listing agents are prohibited, by their fiduciary responsibilities to the seller, from telling you that they think their listing is overpriced, for example. I will. I will provide you with area pricing data, historical sales data and my professional opinions about all aspects of a property, and not only price! If I don’t think a property is right for you, I’ll definitely tell you.

Expert Price Guidance I spend considerable time helping you shape an offer — reviewing comparisons, estimating likely appraisal value and projecting future marketability with minor repairs or updating. When a seller’s asking price is way above what I think a property is worth, I will ensure that this is reviewed with the listing agent and your best interests are served.

5) Can I not work with lots of other agents as well?
No. I work with a limited number of clients at any given time. I make a significant commitment to each of them to find them a house. All I ask in return is they make a commitment to me. However, I do not ask that you make that commitment until we’ve spent time together and agree that there is a “fit” between us. Our first, and sometimes second, time out together is “on me”, so I can get a good idea of what you’re looking for, you get a better feel for the market, and we both can determine whether there’s a basis for an ongoing relationship.

6) How do we start working together?
Send me an email about what you’re looking for (soldwithkim@gmail.com), or better yet give me a call at 813-812-1444. If you’ve been searching the internet, send along the MLS numbers of houses you’ve found that caught your eye. Please include a general budget range — I certainly won’t hold you to it, nor only focus on properties at the upper end of your range, but knowing what price range you’re thinking of helps focus my efforts. If you send an email, please include a phone number, as I’ll want to spend some time with you on the phone. Over the phone, I can get a much better sense of what you’re looking for and what might work for you.

From there, I’ll research listings and email some to you to take a look at. We can discuss what you like and don’t like, and I can give you my opinions on them.

The next step is for us to go out together to look at houses. If you are new to the area it may also be a good idea to review different neighbourhoods so you can get an idea of the market, different price points, settings and styles.

At that point, we can discuss whether you want to retain me as your Buyer’s Agent, the specifics of an exclusive buyer’s agent relationship, and whether you prefer working with me on an exclusive or non-exclusive basis.

Now it’s time to find your perfect home! I look forward to a successful home search with you when you choose me as Your Buyer’s Agent!

The tables have turned once again in our rate market, and now we have the lowest fixed rates we have seen in years, compared to what was the lowest variable rates this summer. Variable rate mortgages are almost at prime, which is 3% right now. Fixed rates on the other hand have gone down. If you get a 1, 2, 3 or 4 year fixed rate it is actually going to be below prime!

One of the greatest pros of going variable is the low penalty for breaking your term when you want to refinance, switch, or sell your house instead of the huge penalties seen when breaking a fixed rate term. Planning and looking into the future on how long you plan to be at your house, if you plan to do renovations or not in the future are all things you must consider when choosing a fixed rate so that this penalty can be minimized and as low as possible. On average when switching a fixed rate into a lower fixed rate even with a penalty up to $10,000.00 you can save on your monthly payments, reduce your amortization on average by 5 years, and take out 7 years worth of accumulated interest payments.

The greatest component of going fixed allows you to be secured in the rate for the whole term, regardless of what is happening to prime, or the condition of the economy. Especially with the possibility of default in Europe, we could still see another increase in rates especially in prime.

So what are the fixed rates at? They change every week so you must keep that in mind, and we can predict that they will start to rise too.
1 Year 2.75%
2 Year 2.49%
3 Year 2.99%
4 Year 2.99%
5 Year 3.29%

If you are thinking about refinancing or simply just switching to a lower rate get locked into these great low rates now for 120 days no obligation!

Lindsay Blair
M#1101416
Mortgage Architects
Mortgage Specialists Direct Team
Lindsay.blair@mortgagespecialistsdirect.com
613-699-2006 ext.11

By law, all realtors—even the one showing the home, listening to your housing dreams and your financial details—work in the best interest of the seller. That is, unless a savvy home buyer signs a Buyer Representation Agreement with a realtor who will work exclusively on their behalf during a home purchase. Without it, under the law of the agency, realtors must pass on any information that may influence the home-buying negotiations to the sellers of the home that their customers are bidding on; even how much they would pay for the home or their motivation.

Canadians now have two choices: customer relationship or client relationship.

A customer service agreement is a disclosure form that states that the realtor is NOT working for you as a buyer, but is providing customer service (fair and honest treatment, factual information about the property that is not visibly evident and to answer any questions you ask about the condition of the property) to you.

With customer status you are virtually “unrepresented” and in a “buyer beware” situation.

On the other hand, Buyer Representation Agreements state that the realtor is working for you and that you are bound to that realtor for the term of the agreement with a holdover period. In this case, your realtor is bound to you with fiduciary duties, (loyalty, obedience, full disclosure, duty to use skill, care and diligence, duty to account for all monies) and protects your information. A clincher is that it also allows the realtor to share his/her expert opinions, giving you full advantage of their knowledge and expertise. Furthermore, it then becomes their duty to answer questions that you may not even know to ask and their accountability is much higher.

There is nothing in the Buyer Representation Agreement that states that you have to buy anything. It only states that if you do that you will use this particular brokerage and that they will be compensated for the service provided.

The best part is that there is no special fee to the client. Instead the realtor gets paid via commission that comes from the seller’s listing agent, just the way it has always been. Yes, that’s right, all that hard work for FREE!

How do you become a client? It’s easy—homebuyers sign an exclusive Buyer’s Representation Agreement with a realtor. Usually, the buyer agrees to work with the realtor for a specified period of time and the realtor agrees to represent the buyer’s interests to the fullest. That’s it!

Why not protect your interests? Hire the person with the most knowledge to work on your behalf and to do it at no extra cost.

A property survey shows the boundaries of the property indicating the lot size, and includes a written description of the property. Property surveys, which resemble a map, are carried out during the original construction of a house and are provided to the buyer at that time. However, if the house you are buying is older you may find that the original survey has long been lost. Sometimes a copy has been kept at the city planning department or at the Land Registry office. In this case you can purchase a copy of the existing survey for a small fee.

Surveys indicate right-of-ways and easements. Right-of-ways detail the right of others to access certain areas of the property (for example, it may allow access to hydro or telephone companies for servicing or a shared lane or driveway). Easements are a right that’s assigned to the property and cannot be removed very easily, if at all. Surveys may also indicate issues such as a fence located outside the property line or an overhanging roof from a detached garage and in these instances, the buyer can ask the seller to correct the problem before closing.

If you’re thinking of buying a home, you may be wondering if you need an up-to-date property survey. It’s could be beneficial to have one, however, Title Insurance may suffice. Your lawyer will most likely suggest that you purchase Title Insurance anyway, and it may soon be mandatory for all real estate property purchases. If you are buying a condo you won’t need a survey, not even for a condo townhouse as essentially the condo corporation will own the land, not you. A simple way to find out if it’s a requirement is to get pre-approved for a mortgage before you buy.

Over time, you may want to add a fence, a pool, a deck or even an extension and you will need a survey when you make these improvements. Many times such changes have occurred since the last survey making it out of date and therefore it has little value in the real estate transaction, but could still be suffice for your own needs.

It should be noted that not every transaction requires a new survey, and Title Insurance may be sufficient. Ask your real estate lawyer to verify this before you purchase the property. It can also depend on when the last survey was completed and what physical changes have taken place since the survey was done. If a new survey is needed, you need to determine who will pay the cost in the Agreement of Purchase and Sale.

This can be a stressful time for parents – both emotionally and financially. It can be even more difficult if you have just purchased a new home, and are unfamiliar with the area. Here are a few tips to help you out if you have just moved to Lanark County.

1. Lanark County has 2 school boards that serve the area – the Upper Canada District School Board (UCDSB) and the Catholic School Board of Eastern Ontario (CSBEO).

2. Both boards have websites that can help you know everything from busing times & routes to special education to French immersion programs. CSBEO – http://www.cdsbeo.on.ca/ UCDSB – http://www.ucdsb.on.ca/

3. In addition to the school boards, there are a number of alternative schools as well. Below are just a few of them:

Calvary Christian Academy – http://www.calvaryca.com/
Mississippi School for the Arts – http://mississippischool.ca/
Montessori School – http://www.perthchildrenshouse.ca/

4. Registration at the 2 traditional boards is as easy as visiting their website, printing off the registration form, and making an appointment with the appropriate school. For UCDSB you also have the option of registering your child online. Things you will need are Child’s birth certificate or other government document to show proof of age; Record of child’s immunization (measles, mumps, rubella, diphtheria, tetanus and polio); & Child’s health card. For CSBEO you should also bring your child’s baptismal certificate.

For information related to registration for the alternative schools, please visit their websites.

5. Don’t forget those school supplies! Every grade seems to have different requirements, but the basics seem to be pens, pencils, pink erasers, binders, lined binder paper, duotangs, coloured pencils, glue sticks, gym clothes & shoes.

Just a reminder to all drivers to be a bit more cautious on the road, as the new school year begins. There will be more kids out and about, and school buses back on the road. Pay attention and let’s have a safe and happy school year!

Overall, sales activity and prices remained stronger than expected in the second quarter. Sales momentum was also better than expected heading into the third quarter. As a result, the 2011 national forecasts for sales activity and average price have been raised slightly.

National sales activity is forecast to reach 450,800 units in 2011, up less than one per cent from levels in 2010. CREA had previously forecast a decline of about one per cent for activity in 2011. Erosion in affordability due to higher prices has prompted a small downward revision to the outlook for sales in 2012.

British Columbia’s 2011 sales forecast has been revised slightly higher, in recognition that home sales there appear to have bottomed out sooner than previously anticipated. Stronger than expected activity in Ontario offset slightly softer than anticipated demand in Quebec, Manitoba, and Newfoundland in the second quarter of 2011. Accordingly, the Ontario sales forecast for 2011 has been raised, while the outlook for activity in Quebec, Manitoba, and Newfoundland has been revised lower.

National sales activity in 2012 is forecast to ease seven tenths of a percentage point to 447,700 units, which is roughly on par with its ten-year average.

“While there had been some talk of potential interest rate increases, that hasn’t happened,” said Gary Morse, CREA President. “In fact, mortgage interest rates have actually come down, and are now expected to remain low for the remainder of this year and into 2012. It’s a great opportunity to purchase a property with financing at very favourable rates.”

The national average home price is forecast to rise 7.2 per cent in 2011 to $363,500. This is an increase from the previous forecast, reflecting continued strong price growth in Vancouver in the second quarter of 2011 and acceleration in prices elsewhere, particularly Toronto. These two markets exert an outsized influence on the national average due to their relatively high level of activity and average price.

The national average home price is expected to moderate in the second half of 2011, returning to normal following a heavily skewed start to the year. In the first half of 2011, the national average home price was pushed upward by a surge in multi-million dollar sales in selected areas of Greater Vancouver and a higher than normal share of overall sales in more expensive markets.

“Some of the expected moderation in the national average price is seasonal, with average price peaking in many local markets during the second quarter of any year,” said Gregory Klump, CREA’s Chief Economist. “Elevated shares of provincial and national sales activity in Vancouver and Toronto are also expected to return to more normal levels, contributing to an anticipated moderation in average price in British Columbia, Ontario, and nationally.”

“Additional new listings are anticipated to result in a more balanced resale housing market in most provinces,” said Klump. “The national average price is forecast to stabilize in 2012, although at a slightly higher level than previously expected.”

For more information, please contact:
Pierre Leduc, Media Relations
The Canadian Real Estate Association
613-237-7111 or 613 884-1460
Email: pleduc@crea.ca

CREA Residential Market Forecast:

* Provincial weighted average price for Quebec; does not affect unweighted national average price calculations. Information on Quebec’s weighted average price calculation can be found at: http://www.fciq.ca/immobilier-statistiques-definitions.php

Student housing is a niche market in the real estate investment world. There is a high demand for it, and that demand will continue to grow in the coming years. Quality of the housing does not have to be the best to get rents that are above average, but the landlord also has to take on additional expenses. College students tend to be much more transient, rents are harder to collect, and students tend to wear out properties much more quickly than renters past the party years.

However, all that being said, the market for student rentals tends to be recession proof as a college education is never going out of style. If you are looking to invest in student housing, the following article from the Los Angeles Times will be helpful.

“According to the National Center for Education Statistics, college enrollment will grow by 11% between 2003 and 2013. Higher education is less affected by economic trends. When times are bad, more people seek a college degree to improve the job prospects; when times are good, a sheepskin becomes even more important. Moreover, children of the baby boom generation are taking longer than their predecessors to graduate, so they need housing for a longer stretch.

Next, toss in the fact that rents for student-housing properties have been rising at a higher rate than at conventional apartments, according to the National Multi-Housing Council, and you have the makings for what savvy real estate investors call a “good niche opportunity.”

via Los Angeles Times.

Without good preparation, many buyers get lulled into the mistaken notion that if a lender pre-qualifies them for a mortgage this means that they have been pre-approved for a home loan. Unfortunately, there’s a world of difference between these two terms. If you’ve ever been confused by the two, we’ll bring you up to speed on how these terms differ – and why a misunderstanding can mean disaster for borrowers.

The Skinny on Pre-Qualified
Getting pre-qualified is the initial step in the mortgage process, and it’s generally fairly simple. You supply a bank or lender with your overall financial picture, including your debt, income and assets. After evaluating this information, a lender can give you an idea of the mortgage amount for which you qualify. Pre-qualification can be done over the phone or on the internet, and there is usually no cost involved. Loan pre-qualification does not include an analysis of your credit report or an in-depth look at your ability to purchase a home.

The initial pre-qualification step allows you to discuss any goals or needs you may have regarding your mortgage with your lender. At this point, a lender can explain your various mortgage options and recommend the type that might be best suited to your situation.

Because it’s a quick procedure, and based only on the information you provide to the lender, your pre-qualified amount is not a sure thing; it’s just the amount for which you might expect to be approved. For this reason, a pre-qualified buyer doesn’t carry the same weight as a pre-approved buyer who has been more thoroughly investigated.

The Skinny on Pre-Approved
Getting pre-approved is the next step, and it tends to be much more involved. You’ll complete an official mortgage application (and possibly pay an application fee), and then supply the lender with the necessary documentation to perform an extensive check on your financial background and current credit rating. (Typically at this stage, you will not have found a house yet, so any reference to “property” on the application will be left blank). From this, the lender can tell you the specific mortgage amount for which you are approved. You’ll also have a better idea of the interest rate you will be charged on the loan and, in some cases, you might be able to lock-in a specific rate. With pre-approval, you will receive a conditional commitment in writing for an exact loan amount, allowing you to look for a home at or below that price level. Obviously, this puts you at an advantage when dealing with a potential seller, as he or she will know you’re one step closer to obtaining an actual mortgage.

The other advantage of completing both of these steps – pre-qualification and pre-approval – before you start to look for a home is that you’ll know in advance how much you can afford. This way, you don’t waste time with guessing or looking at properties that are beyond your means. Getting pre-approved for a mortgage also enables you to move quickly when you find the perfect place. When you make an offer, it won’t be contingent on obtaining financing, which can save you valuable time. In a competitive market, this lets the seller know that your offer is serious – and could prevent you from losing out to another potential buyer who already has financing arranged.

Once you have found the right house for you, you’ll fill in the appropriate details and your pre-approval will become a complete application.

Getting Committed
The final step in the process is what’s called a “loan commitment”, which is only issued by a bank when it has approved you, the borrower, and the house in question. This means the home should be appraised at or above the sales price. The bank may also require more information if the appraiser brings up anything he or she feels should be investigated (i.e. structural problems, accessibility issues, outstanding liens or litigation in progress). Your income and credit profile will be checked once again to ensure nothing has changed since the initial approval.

A loan commitment letter is issued only when the bank is certain it will lend, so the commitment date on your purchase contract should be closer to closing than to the date of your offer.

One Last Word
 Be warned. Pre-approved and pre-qualified are not the same thing, so don’t assume that the bank will provide your loan until you have the former. The mistake could cost you your new home!

by Brian O’Connell