Friday, July 13, 2007

Want the mortgage process to go quick & painless?

If you come across that great real estate deal and need to close quickly it's a good idea to be prepared ahead of time. If you're looking for a fast approval you should have certain documents on hand to make things go smoothly. Also, make sure you deal with a mortgage broker that takes care of all requirements quickly - i.e. appraisal, copy of offer, lawyer handling transaction etc..

Some key documents that all lenders require:

  1. Recent Notice of Assessment from the CCRA after your income tax has been filed. This is the blue letter you receive after you've filed.
  2. A recent pay stub and a letter from employer
  3. Financial Net worth overview showing assets and liabilities.
  4. If self employed, proof of ownership in a company.
  5. Proof of Down payment. All lenders require that you show a 90 history and provide proof of source of funds for any large deposits.
Keep these items in a central spot so that you can locate them quickly. Having these documents easily accessible will make the mortgage experience a lot less stressful for you. You don't want to miss a great opportunity over some missing paperwork.


Tuesday, July 10, 2007

Canada's Mortgage Industry Associations release Real Estate Fraud Brochure for Consumers

VANCOUVER, B.C., July 9 / - Canada's four mortgage industry associations have
announced the release of a joint Real Estate Fraud brochure. The brochure is
designed to increase consumer awareness of real estate fraud issues and will
be available on the associations' websites and from individual members.
The brochure describes common types of real estate fraud including
fraud-for-shelter and fraud-for-profit through identity theft and document
forgery. Consumers are provided with detailed information on the many steps
they can take to prevent becoming a victim of mortgage fraud. The brochure
also explains what consumers should do if they think they are victims of
identity theft or real estate fraud.
In a joint statement, the Chairmen of the Alberta Mortgage Brokers
Association, the Canadian Association of Accredited Mortgage Professionals,
the Independent Mortgage Brokers Association of Ontario and the Mortgage
Brokers Association of B.C. said:

<< "While real estate fraud is still quite rare, it can have a significant impact on those who are affected by it. This brochure gives consumers the comprehensive information they need to avoid becoming a victim. It also provides helpful tips on who to contact for assistance if consumers think they are victims of real estate fraud." >>

The document can be found on the following websites:

Alberta Mortgage Brokers Association - www.amba.ca
Canadian Association of Accredited Mortgage Professionals - www.caamp.org
Independent Mortgage Brokers Association of Ontario - www.imba.ca
Mortgage Brokers Association of British Columbia - www.mba.bc.c

Brent Irving notes: More and more lenders are requiring borrowers to obtain title insurance to help protect against mortgage fraud. If you are a victim of mortgage fraud the cost to recover could be upwards of $100,000 if not more. Another great reason to deal with a mortgage broker who understands the mortgage process. If you are interested in the services of a mortgage broker in White Rock BC please don't hesitate to contact me.

Friday, July 6, 2007

Rising Interest Rates Take a Bite Out of Consumers Household Budgets

VANCOUVER, BC, July 6, 2007 - With an anticipated increase in the Bank of Canada rate July 10th, coupled with increases in fixed rate mortgages this year already, consumers may need to re-evaluate their household budgets.

Even a rise of a few basis points could affect homebuyers and those renewing their mortgage as they are surprised by the impact on their wallets. According to the Canadian Real Estate Association, the average home price in all major markets rose in May 2007 with an average price for a home in British Columbia reaching $454,962. This translates into larger mortgages for those in the market for a new home. Scott Hannah, President of the Credit Counselling Society, the non-profit debt solutions service, says their counsellors see people every day that struggle to balance their budget to meet housing costs. "For many home buyers the continued rise in housing costs is a challenge. The rise in prices in conjunction with the increase in mortgage rates creates a big concern as people try to sustain their lifestyle and for some, keep their home."

"A homeowner with a $250,000 mortgage could see their payments rise by almost $150 per month for every percentage point increase in the interest rate," notes Hannah. "That could create havoc with their monthly budget, not to mention the thousands of dollars extra in interest they will pay over the life of their mortgage."
As interest rates rise, it is a good opportunity for homeowners to re-evaluate their spending. "We recommend that people keep a budget by listing all the monthly expenses, including mortgage, taxes, insurance, food and utilities and resist the temptation to purchase additional items such as gifts, vacations and new furniture on credit," suggests Hannah. "When a single item like the mortgage payment increases it is important to review your budget and determine where modifications can be made rather than dipping into a line of credit or using credit cards to supplement your income."

It's always important to consider the services of a Vancouver BC mortgage broker so that you insure that you're getting the best rate and the lowest payment possible. Mortgage brokers also can approve people that have been declined by their bank.

Wednesday, July 4, 2007

BMO predicts that the Bank of Canada to raise rates twice this summer

BMO predicts that the Bank of Canada to raise rates twice this summer

The Bank of Canada will boost interest rates twice this summer, propelling the Canadian dollar to soar to new 30-year highs, the Bank of Montreal (TSX:BMO) predicts.

The BMO Capital Markets report forecasts that despite recent dampening signals, the central bank will tighten monetary policy for the first time in over a year starting with a 25 basis point hike next week, and further turn the screw on Sept. 5.

This will elevate the bank's key lending rate to 4.75 per cent from the current 4.25 per cent, a move that will not only add fuel to the already soaring loonie, but increase the cost of borrowing for both businesses and homebuyers taking out mortgages.

"The loonie would easily fly above 96 cents US," said the report written by economists Michael Gregory and Benjamin Reitzes. "But while a test of parity is possible, we judge that it's not probable."

The Canadian dollar closed up 0.16 of a cent to 94.46 cents US on Wednesday, the highest since early June, 1977.

In recent weeks, many economists have been softening their hard predictions that bank governor David Dodge will raise rates significantly this year.

After warning in May that the Canadian economy was overheated and interest rates stubbornly holding well above the bank's two per cent target, the bank has tempered its comments of late, including suggestions that the loonie's flight may not be justified by the fundamentals.

Recent economic data has also been weaker than expected, including last week's gross domestic product report showing zero growth in April, and core inflation cooling to 2.2 per cent in the same month, from 2.5 per cent in March.

But the BMO economists say May's consumer price index, when it is released in two weeks, will again show inflation at problem levels. And although growth stalled in April, interest-sensitive sectors such as home and auto sales remain strong, suggesting that interest rates are too low to provide a necessary check on Canadians' spending.

The other factors the central bank will consider, say the economists, is unemployment at a 33-year low, capacity pressures in the economy and sluggish productivity that is contributing to a near 16-year high increase in labour costs.

"The fact is we're coming off an economy that was operating well above capacity and building inflation pressures, the fact that we've had a few weak numbers is not going to stop the bank from what I think is really re-normalizing rates," said Gregory.

"Inflation has been above the bank's target for nine months in a row and it will soon be 10, so sooner or later, the bank is going to have to step in."

Gregory said two events might move the bank from following through on the second tightening measure in September - the loonie rising faster than expected, and the U.S. economy falling flat over the summer months.

"This summer we'll start to see the peak of headwinds blowing in both the housing and mortgage markets, so if the U.S. economy tumbles badly, it could get the bank thinking twice," he said.

The BMO report also predicts that the U.S. Federal Reserve will keep U.S. interest rates on hold indefinitely, but that both England and the European Central Bank will raise rates this summer.

Based on what the BMO economists are saying, there is no better time than now to be pre-approved for a mortgage. I can offer a 4 month mortgage rate guarantee. Act now before rates go up.