Posted: October 30, 2009 Categories: calgary mortgages No Comments
The Canada Mortgage and Housing Corporation is looking at the real-estate market with an open mind. Despite massive volatility in the market, and in Calgary especially, the CMHC is expecting a rebound as early as next year. There are many reasons for this, but here in Calgary you can see them quite plainly:
- New home construction - No matter which end of the city you reside in, new areas are going up. Calgary is still expanding its borders as it adds new suburbs to its mix. This article by the Calgary Herald sheds some light on the surprisingly good performance in the housing market for the last three months, and this article (also by the Calgary Herald) makes mention of the new community going up in Airdrie.
- New infastructure - While the ring road may be experiencing a bit of a roadblock, there’s no denying that the City of Calgary is spending lots of money on bringing its infrastructure up to par. This, aside from being a significant economic stimulant in its own right, will make Calgary more accessible.
- The economy is stabilizing - Yes, there are many reports that the economy is still sluggish, but it’s also showing signs of stability. As long as you have prepared yourself financially (see related posts: here, here, and here) there is little to fear at this point. The contractions are happening, but unlike what happened in late 2007/early 2008, most of the downsizing has already taken place. In fact, unemployment has fallen by 0.3%.
Keep a watchful eye on the market if you’re thinking about making a purchase. Now may be a great time to take advantage of good interest rates and plenty of availability- you never know just how long it will last.
About the Purcell Mortgage Team:
The Purcell Mortgage Team are an industry-leading pair of mortgage professionals who have been serving Calgary for several years. JoAnne Purcell was ranked within the Top 50 Canadian Mortgage Professionals in the CMP Magazine. If you are in need a reputable calgary mortgage specialist, please contact us today!
The Purcell Mortgage Team are experts on Calgary mortgages!
Posted: October 27, 2009 Categories: financial advice No Comments
Every year Calgarians button down for another frozen four months, and every year mother nature surprises even the most informed of us. Case and point, the -14 degree weather we were blessed with in early October is now average 5 – 10 degrees. It’s a phenominon that few Calgarians will ever fully understand (or appreciate).
Before Christmas arrives many people take a few days to review their financial position and determine what kind of financial shape they’re in. If you’re like us, or anyone else for that matter, how much you spend during th Christmas season is completely dependent on the figures in your bank account. Some have the luxury of a limitless budget, but for the rest of us a little bit of careful planning can go a long way.
Budgeting Around Your Mortgage
Many people budget around their “rent”, or the cost of their mortgage payment and nothing else. What people fail to realize is that there are many more expenses tied into your home than just your mortgage payment. Mortgage-related expenses, such as property taxes, can creep up on you when you least expect it. If you are a new homeowner, these expenses could lead to a very lean Christmas.
Let’s not forget the added expenses associated with the wonderful winter season, either. Notable seasonal expenses include:
- Increased heating costs - Many people can go the majority of the spring and summer without the heat turned on. Come late September, suddenly the furnace is back on and with it comes a nice heating bill.
- Increased gas expenses - While subtle, your vehicle(s) do use more gas in the winter than they do in the summer. These are many reasons for this, but it comes down to the amount of effort needed from your vehicle in order to get it to move the a distance. In the summer, where traction is easy to find, it doesn’t take much at all. However, all the slipping and sliding in the winter makes life particularly difficult for your car. For some, their gas costs nearly double.
- Seasonal maintenance - Drafty windows are a sure-fire way to increase your heating costs and lower your homes temperature in one foul swoop. Just like the seals around windows need to be replaced every now and again, there are numerous seasonal items that require maintenance every winter.
This Christmas season, don’t get caught with your pants down. Take the time to properly budget your Christmas season, as well as the time that follows it, so that there aren’t any nasty financial surprises waiting for you come spring.
About the Purcell Mortgage Team:
Todd Purcell and JoAnne Purcell are the certified mortgage specialists in Calgary that make up the Purcell Mortgage Team. Todd and JoAnne strive to maintain an exceptional level of service to all of their current and prospective clients. Do you live in Alberta and are in need of reputable and ethical mortgage assistance? Contact the Purcell Mortgage Team today!
Posted: October 23, 2009 Categories: mortgage advice No Comments
There seems to be a lot of conflicting information regarding home loans and mortgages. In particular, you have probably heard that lenders are requiring more money down than ever, and that you shouldn’t even consider purchasing a home unless you have 20 percent to put down on the home.
What’s fact and what’s fiction?
Although the myth that you must have more than 20 percent down is not exactly true, it does shed light on the changes that the mortgage industry has made since the decline of the credit sector and subsequently of the housing market.
The fact of the matter is that lenders are pickier than ever regarding to whom they will extend a mortgage. With a record number of homes going into foreclosure, and literally millions of Americans behind on their mortgage payments, lenders must do what they can to ensure that an individual will be able to repay a mortgage loan; and a down payment is often a good indicator of that.
The amount that you will need to come to the table with in order to secure a mortgage will depend on the lender. Most homebuyers today are required to put at least five percent down, while others may need to put as much as 20 percent down to secure a home loan.
Very expensive homes or homes bought in areas that are burdened by an overabundance of foreclosures may even require more than 20 percent down.
Q: Can I still get a home loan with no money down?
A: Given today’s economy and lending market, do not expect to snag a home loan with no money down. The only exception currently offered is the cash back mortgage (also goes by other names depending on the lender), but in this case the lender still requires the minimum 5% down payment, the difference is that they provide the down payment. Even better is they do not require it to be paid back, they simply provide the down payment. But don’t get too excited just yet, they do have very strict guidelines on these offers , so if you have a beacon score less than 680 you probably won’t get approved. Also don’t expect the best rates out there either, you will be looking at bank posted rates, which are typically 1-2% higher than the best rates offered by lenders.
Q: What is the minimum I can pay for a down payment?
A: With regards to conventional loans, for single-family homes, you may be able to secure a mortgage for as little as five percent down. The neighborhood must be flourishing and the property must meet the exacting standards of the lender, but it can be done. However, it is important to point out that you must have a great credit score, adequate income and assets and an acceptable debt-to-income ratio, as well.
Q: Will I need more money down if I buy in an area that is currently dealing with a high foreclosure rate?
A: Probably. Many lenders keep a close eye on areas that they feel are declining, and will often ask for an additional five percent down if you want to purchase a home in one of these areas. In other words, if you are using a lender that typically requires five percent down, they may require 10 percent down if you want to purchase a home in area with a high foreclosure rate.
Q: What about condos?
A: Lenders typically require a larger down payment for a condo, but this is not necessary. As long as you have good credit you can land yourself a condo in downtown Calgary for 5% down, or if you have excellent credit you may be able to qualify for a cash back mortgage as described above. Just keep in mind that to get the best rates in Calgary Mortgages, and the Calgary Condo market you will be expected to have excellent credit.
Your best course of action is to simply talk to a lender and get a loan pre-approval before you begin looking at homes so that you can become educated regarding the lender’s down payment requirements.
About the Purcell Mortgage Team:
The Purcell Mortgage Team are an industry-leading pair of mortgage professionals who have been serving Calgary for several years. JoAnne Purcell was ranked within the Top 50 Canadian Mortgage Professionals in the CMP Magazine. If you are in need a reputable Calgary mortgage broker, please contact us today!
Posted: October 19, 2009 Categories: calgary mortgage broker, mortgage advice No Comments
Your home will likely be the largest purchase you ever make, thus it requires that you take the time to find the best loan program and the best mortgage lender to handle your home loan.
Finding the best mortgage lender is a lot like any other industry. You must ask plenty of questions and perform due diligence, ensuring that you can make an educated, well-informed decision regarding your mortgage loan.
For many home buyers, particularly first-time homebuyers, the process of finding the perfect mortgage lender can be quite daunting; even overwhelming. It pays to take your time and research all of your options so that you can be rest assured that you made the right decision.
To ensure that your mortgage loan needs are best served, follow these simple tips:
- Find the best rates. Mortgage rates are published in the daily newspaper, so you can make this resource a first stop. You can also view current mortgage rates through a variety of websites, including ours. There is simply no better way to stay abreast of all changes in the lending industry than to read the latest news, either through the newspaper or Internet.
- After you locate a lender who offers a good mortgage rate, look further into the associated fees of the loan, such as application fees, origination fees and appraisal fees. Many lenders may offer low interest rates, but once you get done paying all of the related fees you are in over your head for thousands of dollars.
- Once you have chosen a few lenders who fit the bill when it comes to mortgage rates and related fees, make sure they are a trusted lender with a solid reputation. This is not the time to find subpar lenders who may or may not have a good history of lending.
- Ask friends, family members and neighbors for mortgage lender referrals. Often times, the best way to find a great lender is through the referral of a trusted individual. Although this should certainly not be the only way in which to find a mortgage lender, it can help narrow down your search.
- Make an appointment to meet with several lenders. Now is the time to ask plenty of questions regarding their loan products and your financing needs. If the lender is inpatient with you or is difficult when it comes to answering all of your questions and addressing all of your concerns then it is best to move on.
- Ask the mortgage lender professional which loan products are best for you. A good mortgage lender will take the time to thoroughly research your loan needs so that you won’t get stuck in a loan that’s simply not suitable for your situation or budget.
- Take a first-time homebuyer course. Many first-time homebuyers choose to take a first-time homebuyer course through a local real estate company. A course in home buying should also cover the home loan process, and is often a great place to ask questions and gather information so that you can make the best decision regarding your choice of home loans. Alternatively, download our new homebuyers guide!
Or let us do your homework for you. Calgary Mortgage Brokers and Calgary Mortgage Associates do the due-diligence for you. Mortgage specialists go through the above process everyday and don’t charge the client a dime to for their effort, so call contact the Purcell Mortgage Team and let us take the guess work out finding the lender that is best for you!
About the Purcell Mortgage Team:
The Purcell Mortgage Team are an industry-leading pair of mortgage professionals who have been serving Calgary for several years. JoAnne Purcell was ranked within the Top 50 Canadian Mortgage Professionals in the CMP Magazine. If you are in need a reputable calgary mortgage broker please contact us today!
The Purcell Mortgage Team are experts on Calgary mortgages!
Posted: October 12, 2009 Categories: economy, recession No Comments
Tired of hearing about recession-this and new-economy-that? In what seems to be a rare and welcome glimmer of good news, unemployment in Canada fell by 0.3% in September. This drop places unemployment at 8.4% nation-wide.
The drop in unemployment was sparked by two consecutive months of job growth, with September bringing 31,000 new jobs. While the number of part-time positions has increased significantly during the duration of this recession, the 31,000 new jobs created last month were largely full-time positions.
Signs of Economic Improvement – Labour Force
A recession is a complex economic situation that doesn’t simply “fix” itself over night. However, there are many signs on the labour front that are pointing toward an eventual economic correction. While it is likely that we will not return to the “golden age” of spending (aka- 2007/2008) for quite some time, we will hit an economically stable point sooner rather than later.
Statistics Canada has published a significant amount of information that pertains to regional economic employment statistics. As it stands, Britich Columbia, New Brunswick, and Prince Edward Island are the only provinces with notable employment gains in September. Ontario would have been included in that list were it not for significant losses of part-time positions (despite large full-time position gains).
Notable statistics include:
- Overall, employment has fallen by 2.1% since its October 2008 peak. This results in a rough job-loss of approximately 357,000.
- Construction, manufacturing, and educational services say employment increases in September.
- Canadians have been working more hours since April 2009 by approximately 2.0%.
Compared to the doom and gloom that we have been hearing about for the last 18 months or so, this latest batch of good news is yet another sign that the Canadian economy is well on its way to improvement and stabilization.
How does this affect new home buyers, or people purchasing real estate in general? Read our article on purchasing a home despite economic doom and gloom.
Source: http://www.statcan.gc.ca/subjects-sujets/labour-travail/lfs-epa/lfs-epa-eng.htm
About the Purcell Mortgage Team:
The Purcell Mortgage Team are an industry-leading pair of mortgage professionals who have been serving Calgary for several years. JoAnne Purcell was ranked within the Top 50 Canadian Mortgage Professionals in the CMP Magazine. If you are in need a reputable calgary mortgage broker please contact us today!
The Purcell Mortgage Team are experts on Calgary mortgages!
Posted: October 9, 2009 Categories: mortgage advice 1 Comment
Your home is likely the single largest purchase you will ever make. Sounds a bit scary, doesn’t it? It doesn’t have to be!
The process of purchasing a home, however, should not be taken lightly, as the type of financing you will secure for your home purchase will dictate your monthly budget for years to come.
With that said, it is important to understand that finding a good mortgage rate may just be the beginning. There are many strategies that you can employ to secure the best, possible mortgage for your home.
Below are several key strategies for your consideration:
- Just like anything else, mortgage rates can be negotiated. It is not out of the question to ask for a reduction in a published mortgage rate, even if it is just a quarter of a point.
Remember that mortgage lenders are just like any other business, and they are out there, competing for your business. In other words, don’t just choose a mortgage lender without thoroughly examining other lenders and their rates in your area before committing to a particular lender. Check out the published rates and take the time to learn about all of the loan programs available so that you can find the one that best meets your needs and your budget.
- Consider the advantages of a seller concession. A seller concession essentially involves asking the seller for a percentage of the home in a concession (which is usually no more than six percent). For example, if you purchase a home for $200,000 and ask for a seller concession of five percent, the price of the home will become $210,000, but the seller will return that $10,000 seller commission to you at closing, thereby enabling you to use the funds toward your closing costs.
In other words, you are effectively rolling the closing costs of your mortgage back into the loan, thereby providing yourself with additional cash funds for closing expenses.
Another bonus to a seller concession is that, because mortgage interest is tax deductible, you can write off the costs associated with closing. Although you will end up paying a slightly higher mortgage payment, many buyers find the relief of not having to come up with the cash at closing to be a good trade-off.
However, it is important to note that the only way you can swing a seller concession is if the house is appraised for at least the amount being taken out for your mortgage.
- Assume the seller’s mortgage. You may be able to save money by simply assuming the existing mortgage on the home that you’re buying, assuming that the mortgage is at a lower interest rate than current interest rates. You may be able to save some costs this way, particularly in administrative costs, although you will need to provide enough cash to cover the difference between the purchase price of the home and outstanding mortgage.
- Pay down the principal on the home, when you are able. There is simply no better way to pay down your mortgage balance and the interest that goes along with it than to pay extra payments on your loan every year. Even one extra payment each year will allow you to pay off your mortgage years before you would have otherwise.
About the Purcell Mortgage Team:
The Purcell Mortgage Team are an industry-leading pair of mortgage professionals who have been serving Calgary for several years. JoAnne Purcell was ranked within the Top 50 Canadian Mortgage Professionals in the CMP Magazine. If you are in need a reputable calgary mortgage broker please contact us today!
The Purcell Mortgage Team are experts on Calgary mortgages!
Posted: October 5, 2009 Categories: calgary mortgage broker, mortgage advice 1 Comment
There’s no doubt about the current credit market: mortgages are not what they used to be. Stricter lending guidelines can make your home buying experience all the more complicated – unless you prepare yourself and your credit in advance.
Before you begin perusing neighborhoods and dreaming of your first home, you should instead begin thinking about your credit. Because, let’s face it, if your credit isn’t in order, obtaining a mortgage may simply be unattainable, especially in today’s economic climate.
Don’t let this information scare you; instead, begin the road to understanding your credit so that you can be fully prepared to take on a mortgage lender and walk away with a mortgage for your first home.
The Road to a Better Credit Report
The first step is to understand that one of the first things a lender will do is review your credit report. In fact, the lender will likely pour over it with a fine-tooth comb.
What is the lender looking for? Evidence that you have managed your finances well; that you have a strong history of paying your bills on time; and that you aren’t overextended with debt.
Therefore, your first plan of attack should be to order a copy of your credit report from all three, national reporting bureaus: TransUnion, Equifax and Experian. Best of all, you are entitled to a free copy of your credit report, from all three credit agencies, on an annual basis.
How to Evaluate Your True Credit
Once you have possession of your credit reports, you will need to make sure they are accurate. This may involve quite a bit of your time, but it is necessary, as even minor errors or discrepancies on your credit report can lower your overall credit rating, thereby either preventing you from obtaining the best, possible interest rate or from obtaining a mortgage at all.
If you locate any discrepancies or errors on your credit report, it is crucial that you immediately contact the appropriate credit reporting agency, who will then investigate and hopefully resolve the issue on your credit report.
What Your Mortgage Lender Evaluates
Your mortgage lender will ultimately be looking at your FICO score, which is designed to help lenders decide whether they think you are a good credit risk. Your FICO score is comprised of several factors, including:
- Your payment history – Have you paid your debts on time?
- The total amount of your debt – Also referred to your debt-to-income ratio, or how much debt you pay out each month in relation to your overall income. Now is a good time to begin paying off as much debt as possible.
- Your credit history – A lender will look for a history of responsible credit management on your part.
There is no magical formula for determining your FICO score; instead, it is a culmination of several factors, all of which work together to give a lender a good idea of how you have managed your credit in the past, and how much debt you have taken on at any given time.
The best rule of thumb is to simply pay your bills on time, keep your debt to a minimum and check your credit reports for accuracy before applying for a mortgage so you can be ahead of the game and ready to secure a mortgage.
About the Purcell Mortgage Team:
The Purcell Mortgage Team are an industry-leading pair of mortgage professionals who have been serving Calgary for several years. JoAnne Purcell was ranked within the Top 50 Canadian Mortgage Professionals in the CMP Magazine. If you are in need a reputable calgary mortgage broker please contact us today!
The Purcell Mortgage Team are experts on Calgary mortgages!
Posted: October 1, 2009 Categories: Uncategorized No Comments
Only available for the 2009 tax year, the Home Renovation Tax Credit (HRTC) is providing Canadians a welcome incentive to improve their home. These improvements can be made to an eligible dwelling (personal residence, home, or cottage). As well, the tax credit applies on purchases over $1,000 but less than $10,000.
What Qualifies as an Eligible Dwelling?
The CRA website defines an eligible dwelling as a housing unit (house, cottage, condo, etc.) that is the principal residence of one or more of your family members at any time between January 27, 2009 and February 1, 2010.
Effectively, this means that any dwelling inhabited by yourself, your partner (through marriage or common-law), or your children are eligible for the tax credit.
What You Need to Claim the HRTC
Unlike most tax credits, that require vast amounts of documentation to verify your eligibility, the HRTC is quite simple to claim. You simply need to provide sufficient documentation to prove that you did purchase the improvement you are claiming. Acceptable documentation includes:
- Contract agreements, invoices, and receipts. So long as these documents clearly state the vendor/contractor, the business address, and the GST/PST registration number.
- The date when the goods/services were delivered/performed
- Proof of payment – Obviously this is needed to prove that you fall into the stipulations mentioned above.
Questions About the HRTC?
This is just a brief overview of the home renovation tax credit. If you have questions that aren’t addressed here the CRA has set up a minisite that should be able to answer all of your questions. It can be found here: http://www.cra-arc.gc.ca/hrtc/.
We think that the home renovation tax credit is a great “excuse” for Canadians to go out and renovate! Receiving a tax credit for performing the renovations that you have been wanting to perform only sweetens the deal!
About the Purcell Mortgage Team:
The Purcell Mortgage Team are an industry-leading pair of mortgage professionals who have been serving Calgary for several years. JoAnne Purcell was ranked within the Top 50 Canadian Mortgage Professionals in the CMP Magazine. If you are in need a reputable calgary mortgage broker please contact us today!
The Purcell Mortgage Team are experts on Calgary mortgages!
Posted: September 23, 2009 Categories: calgary mortgage broker, mortgage advice No Comments
Interest rates sit at near-historic lows. This reason alone is compelling enough for many people to make the transition from renting to ownership. If that’s you, congratulations! You have many factors working for you right now: plenty of homes available for purchase, low interest rates, and the fact that many homeowners are looking to sell now (and are very negotiable as a result).
Mortgage Requirements Have Been Tightened
Do you recall the attitude that existed several years ago when mortgages were being handed out faster than Halloween candy? Unfortunately, the “money for all” approach that many lenders had simply doesn’t exist today. The market “crash”, along with tightened access to credit, have changed the way many people will be able to obtain a mortgage.
However, that doesn’t make it impossible. It simply means that, in regards to applying for a mortgage, you need to have everything in order. Your calgary mortgage broker will be able to provide more information in detail.
Preparing for Your Mortgage Application: Four Essential Steps
The golden rule here is to think ahead. Don’t disillusion yourself into believing that you can have everything prepared in a matter of hours or days. When you are dealing with multiple contacts across a variety of businesses, things can take days, weeks, or months to materialize properly. Thinking ahead and organizing everything a month or two in advance can save you equal that in frustration.
Thinking ahead is actually pretty easy. All you have to do is:
- Know your lendability - Order a copy of your credit report from the major bureaus so that you know what your credit score is. If it’s good (above 650), great! If it isn’t (below 600), work on getting it better (lower debt, pay bills on time, pay more than minimums, etc.). Reducing your debt-to-income ratio before you apply for a mortgage is always a good idea (lenders are looking at your debt-to-income ratio more than ever now).
- Gather all necessary documentation - Proof of income, down-payment source, bank statements, bills, insurance, etc. The sooner you have it the more prepared you are.
- Freeze all credit gathering until after the mortgage process – Applying for credit makes you more of a risk to a lender. This is especially true when the lender could possibly provide you with hundreds of thousands of dollars. Don’t apply for a new credit card until after you have your mortgage.
- Remain stable, accessible, and trackable - Not you specifically, but the source of where your money is coming from. Lenders will want to see your down-payment in a location that is verifiable, such as a guaranteed investment account or savings account. They’ll also want to see that your day-to-day lifestyle is sustainable, and the addition of a mortgage won’t create too much financial risk.
Taking the time to gather your financial documents and proof of good candidacy is essential. A mortgage broker that specializes in Calgary mortgages is key in streamlining this process for you.
About the Purcell Mortgage Team:
The Purcell Mortgage Team are an industry-leading pair of mortgage professionals who have been serving Calgary for several years. JoAnne Purcell was ranked within the Top 50 Canadian Mortgage Professionals in the CMP Magazine. If you are in need a reputable calgary mortgage broker please contact us today!
The Purcell Mortgage Team are experts on Calgary mortgages!
Posted: September 18, 2009 Categories: calgary mortgage broker No Comments
A recession hit us. I know, I know, brace yourself. That’s a bit of surprising news, isn’t it?
Sarcasm aside, there’s no denying that the global economic crisis (AKA, the recession) really put a lot of people in positions they weren’t used to being in. For many people born post 1980, a “recession” was an entirely new, completely foreign concept. For others, it was a case of lather, rinse, and repeat.
However, how you feel about the recession doesn’t change the fact that it has made life a little more difficult for those looking to obtain a loan or mortgage. Before the recession, banks and lenders alike seemed to hand out zero-down mortgages like candy. Now? Well, be prepared to save some cash.
Obtaining a Mortgage Post Recession
People can still get mortgages, and unless you have absolutely no income, no credit, and no cash, there’s a good chance that you can get one too. Many banks have dramatically tightened their purse-strings, which is why Calgarians looking for a mortgage may find that using a Calgary mortgage broker is the way to go, but that doesn’t mean that they’re impossible to obtain.
Your credit is more important than before, but it doesn’t have to be squeaky clean for a lender to provide you a mortgage (especially if you’re using an experienced calgary mortgage broker). As always, make sure that you have your ducks in a row:
- Clean up your credit - Pay off as much of your debt as possible a few months before approaching a lender. This will make you more applicable for credit as your debt:income ratio will have been reduced.
- Build a down-payment – Save money to be used as a down-payment. The more you have, the better your chances of getting a mortgage (and the more you may be able to get approved for).
- Show consistency and stability in your lifestyle - If a lender runs your credit bureau and sees that you’ve been trying to get a ton of credit in a very short period of time it makes you look like a serious risk. Avoid seeking any more credit than you absolutely need.
Are the Days of Zero-Down Long Gone?
For some people, yes, the days of zero-down mortgages are over. However, these people are also the people that likely should not have necessarily obtained a mortgage in the first place (due to financial/economic reasons, stability reasons, or otherwise).
As always, your mortgage broker will let you know about what your best options are and how they’ll work for you.
About the Purcell Mortgage Team:
The Purcell Mortgage Team are an industry-leading pair of mortgage professionals who have been serving Calgary for several years. JoAnne Purcell was ranked within the Top 50 Canadian Mortgage Professionals in the CMP Magazine. If you are in need a reputable calgary mortgage broker please contact us today!
The Purcell Mortgage Team are experts on Calgary mortgages!
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