The 10 Not-To-Do’s after Subject Removal

Buying a home is the largest purchase most of us ever encounter. Yet a small percentage of people sometimes take less time considering it than they do when buying an online item. The reason is, it’s unique territory to many. We don’t know what to ask and we are aided by many professionals unlike when we buy items on online.

We also may take things for granted, rely on others too much, and sometimes this leads to buyers remorse. So let’s help you arm your self with the mortgage not-to-do’s that can cause you to lose your new home, before you even move in.

Regardless if you are pre-approved for a mortgage or currently engaged in negotiating a home purchase with an approved mortgage, these rules below apply. The rules are especially important after you have removed your subjects on your purchase contract and put up your deposit to hold your home because if you make one bad move here you could lose your deposit which can be $10,000 to $100,000 and be subject to lawsuits.

  1. Thou shall not buy a new car, no matter what, or you may be living in it! It will impact your debt ratio’s and you could be declined.
  2. Thou shall not co-sign a loan for anyone, for anything. It will impact your debt ratio’s and you could be declined.
  3. Thou shall not quit or change your job. New job income’s can not be used for a mortgage application, and it will impact your debt ratio’s and you could be declined.
  4. Thou shall not use your Credit Cards or Line Of Credits for big purchase. It will impact your debt ratio’s and you could be declined.
  5. Thou shall not spend your down payment savings or closing costs savings verified by your mortgage company. They will decline you if they recheck.
  6. …Did I mention don’t quit your job?? That’s a big one. I’ve seen it twice in 15 years to my amazement and yes the lenders check up to 10 days before closing. They frown upon this.
  7. Thou shall not apply for new credit of any type, especially lines of credit for reno’s or furniture purchase. It will impact your debt ratio’s and you could be declined.
  8. Thou shall not make large deposits into your savings and chequing accounts. All deposits must now be verified and this takes time and could result in long delays at closing.
  9. Thou shall not allow any mortgage application to be processed with omitted OR missing debts or non-disclosed support payments. It will be found eventually and usually too late. This is your responsibility ultimately – your bank and mortgage brokers can’t read minds and don’t always see all debts up front.
  10. Thou shall not miss a payment or a cell phone bill. Any missed payments may lower your score and cause the lender to pull their approval.

I hope this list was helpful and if you are looking for a mortgage in Chilliwack, Abbotsford or Mission we have offices and mortgages brokers standing by! 

I personally would like to wish you and your families a healthy and prosperous 2018.

By Referral Mortgage Consultants*

“Click, Call, Chat – Award Winning Brokers”

Dave 604 897 2741 Jordi 604 615 1312

www.AbbotsfordsMortgageBroker.com

www.ChilliwackMortgageBroker.com

www.PeaceOfficeMortgageBroker.com

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1 New Mortgage Rule Change to Watch in 2017

As we head into the fall market and after 1 year since the last mortgage rule changes, OFSI (the governing body in Canada for financial services) are proposing yet another mortgage rule change that may impact your home buying/purchasing limits.  OFSI has proposed changes to the Guideline B-20 Residential Mortgage Underwriting Practices and Procedures (referred to as B-20 – http://www.osfi-bsif.gc.ca/Eng/fi-if/in-ai/Pages/rfmrm.aspx).  The most concerning change would be imposing a 200 basis point qualifying stress test for all uninsured mortgages.

What does this mean for the buyer?  Even a 50% downpayment, would be required to qualify for the mortgage based on a rate 2% higher than the actual mortgage rate you would be obtaining.  So, if the actual rate you were obtaining today were let’s say 2.99%, you would have to qualify for the mortgage based on a rate of 4.99%( 2.99% + 2% for qualifying rule = 4.99%)

This higher qualifying rate would essentially reduce the amount of mortgage that could be obtained  hence reduce the eligible purchase price for a new home.  On average, this would reduce  buying power by approximately 14%.

Here is an example of the reduction in buying power:

-Clients are selling home and buying a new one -Household Income: $120,000 per year -Down payment: Up to $180,000 (they want to put at least 20% down)  $120K Annual Income/20% down

 Today:    2.99%, 30 year amortization.     Max Purchase Price $900K     Down payment $180K     Max mortgage $720K

 Proposed:    4.99%, 30 year amortization     Max Purchase Price $800k     Down Payment $180K     Max Mortgage $620K

While this is still in the proposal stage, we anticipate this coming into effect mid to end of October 2017.  The good news is, buyers can prepare for these changes ahead of time. The most effective way is by obtaining a pre-approval now that secures the rate for up to 120 days. Although It is not certain that lenders would be able to honor the approval based on how OSFI rolls out the proposed changes, it is still one of the best ways to be proactive.  Let us review your options now and create an optimum mortgage plan. Contact us today for your free home financing advice.

                                            

By Referral Mortgage Consultants*

“Click, Call, Chat – Award Winning Brokers”
Dave  604 897 2741 Jordi 604 615 1312
www.AbbotsfordsMortgageBroker.com

www.ChilliwackMortgageBroker.com

www.BRMC.ca

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*By Referral Mortgage Consultants – doing business as BRMC is: Verico Preferred Financing Inc / Verico Canadian 1st Mortgage Corp which have a co-brokering agreement and there is a common Mortgage relationship and are licensed with the Verico Dreyer Group. Mortgage ownership, that employees of both Mortgage companies may review, advise and help process the Mortgage files. That Verico Preferred Financing Inc & Verico Canadian 1st Mortgage Corp share the some expense and income from mortgages. Kim Langille Featured on thess site is an unlicensed mortgage assistant only, not a Mortgage Consultant. Jordi Browne featured on this site is the Mortgage Broker of record. “The Broker” is Jordi Browne. Jordi Browne also holds a Life Insurance License and represents Verico Canadian 1st Mortgage Corp. Dave Browne featured on this site has a Life Insurance License too but is an independent agent– Jordi and Dave Browne co-broker life insurance files and share expenses, all income retained by Verico Canadian 1st Mortgage Corp.

Prepare for interest rate increases in 45 days due to CMHC increased premiums.

It’s Sunday and I just finished the chore of cleaning the bathrooms. I’m heading next to the elliptical machine to burn some shame before I line up a couple Field House beers this afternoon and watch golf 🙂

I’m blogging this morning after a busy start to our mortgage business in 2017. The first 4 weeks were more active then I expected, and I was optimistic coming into the year that our mortgage brokers were in for a busy Spring to begin with.

So before I go and listen to some embarrassing high energy Pop Music radio station on my phone I thought first I’d share some interest rate info I received at our broker meeting this past week. The big wigs at the different banks have now had time to read through and understand all the rule changes we have endured recently. They have determined that the next set of rule changes set to be implemented in the middle of March are no doubt going to lead banks to increased fixed interest rates as a result of more new expenses being passed along to our borrowers.

We got this exact same type of information late last year regarding increased expenses and saw our 5 year fixed mortgage rates increase from an average low of 2.39% to 2.44% in October to an average low of 2.69% to 2.74% the next month – That all happened very quickly essentially and I regret not helping more people lock in their mortgage rates last November. Well I’m not going to let that happen again so this time I’m announcing this change ahead of time and I will be calling as many people as I can in February before the March 17th deadline.

Now these rate increases are not written in stone yet but getting a rate hold is free so call now and avoid paying 3.09% to 3.19% or more on 5 year fixed mortgages rates.

 

By Referral Mortgage Consultants*

“Click, Call, Chat – Award Winning Brokers”

Dave  604 897 2741 Jordi 604 615 1312 www.AbbotsfordsMortgageBroker.com

www.ChilliwackMortgageBroker.com

 www.BRMC.ca

 www.PeaceOfficeMortgageBroker.com

Connect with us on!  BRMC Facebook

BRMC Google review Chilliwack Office

BRMC Google review Abbotsford Office

BRMC Google review Mission Office 

http://www.linkedin.com/company/2410358

https://twitter.com/brmcmortgages

http://www.youtube.com/user/BRMCmortgages

We’re active on Facebook, Twitter, LinkedIn & YouTube. We really appreciate reviews! Good or Bad please let the world hear your voice! Connect with us for ongoing industry news items, contests & prizes.

*By Referral Mortgage Consultants – doing business as BRMC is: Verico Preferred Financing Inc / Verico Canadian 1st Mortgage Corp which have a co-brokering agreement and there is a common Mortgage relationship and are licensed with the Verico Dreyer Group. Mortgage ownership, that employees of both Mortgage companies may review, advise and help process the Mortgage files. That Verico Preferred Financing Inc & Verico Canadian 1st Mortgage Corp share the some expense and income from mortgages.

 

 

 

Higher Down Payments for Home Buyers Tomorrow!

Abbotsford, Chilliwack and Mission: A stolen gift from the Federal Grinch or a measured stance against an over heated real estate market?

According to Richard Madan from CTV news, Abbotsford, Chilliwack and Mission mortgages will see the Federal Government change their minimum down payment in 2016.

Tomorrow on Friday December 11th 2015  they are announcing that minimum down payments are being increased depending on the house purchase price. This will ultimately require buyers to save up more money to buy a home.

The new regulation will be require buyers to put 10% down payment on any amount of purchase price beyond $500,000.00. See the comparison chart below.

The regulation are expected to take effect in 2016.

Buyer shopping for homes below $500,000.00 will not be affected.

Our finance minister Bill Morneau will announce tomorrow morning. These measures are taken to cool the heated Real Estate market locally and in Ontario.

Purchase Price Current Down Payment Addition Down Payment New Down Payment
$400,000.00 $20,000.00 $0.00 $20,000.00
$500,000.00 $25,000.00 $0.00 $25,000.00
$600,000.00 $30,000.00 $5,000.00 $35,000.00
$700,000.00 $35,000.00 $10,000.00 $45,000.00
$800,000.00 $40,000.00 $15,000.00 $55,000.00
$900,000.00 $45,000.00 $20,000.00 $65,000.00

SOURCE:http://www.ctvnews.ca/mobile/business/feds-to-tighten-mortgage-rules-for-homes-over-500k-1.2695989

Abbotsford, Chilliwack, Mission New Down Payment Rules

By Referral Mortgage Consultants*

“Click, Call, Chat – Award Winning Brokers”
 1 – 32540 Logan Ave
Mission BCV2V 6G3

&

360-3033 Immel St

AbbotsfordBCV2S 6S2

&

8387 Young Rd

ChilliwackBCV2P 4N8

Dave  604 897 2741 Jordi 604 615 1312
www.AbbotsfordsMortgageBroker.com

 

www.BRMC.ca

 

www.PeaceOfficeMortgageBroker.com

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