Mortgagenomics Canada

Mortgage applications often reach that critical tipping point when the addition of a non-occupying applicant is required to push the application over the finish line for approval. The non-occupying applicant is often a parent or close family member and is referred to as either a Co-signer, or Guarantor. The difference between the two is as follows:Co-Signer: the addition of a non-occupying applicant to a mortgage and land title registration.Guarantor: the addition of a non-occupying applicant to a mortgage, without the requirement of registering on title. Only available with select lenders and with loan to value ratios that are less than 80%As you are now aware, there are two distinct types of non-occupying mortgage applicants...CLICK HERE to be re-directed to the blog version of this episodeContact Marko, he's a Mortgage Broker!604-800-9593 direct Vancouver403-606-3751 direct Calgarymarkogelo.comFacebook@markogelo (Twitter)MarkoMusic (SoundCloud Account)...all podcast

Whether it’s due to employment, quality of life, or a multitude of other reasons, Canadians have demonstrated that they are comfortable in packing up and choosing another province to live in. In fact, in 2021 more than 200,000 Canadians switched provinces across Canada...and this is only the statistics released up until the first two quarters of the year, 2021 (Source: Statistics Canada).Upon arriving to a new province, the more common pathway to homeownership is rent first (typically 1-2 years), then buy after.   But lately, the trend is to purchase immediately upon arrival. With real estate prices surging in Canada’s two most prominent intake provinces, Alberta and BC, newly arriving migrants are opting out of the 1-2 year honeymoon phase of renting and jumping right into home ownership. Here’s what you need to know when it comes to qualifying for a mortgage when relocating to another province (or city): ...click here to read the rest of the articleContact Marko, he's a Mortgag

Every so often I receive a mortgage application for a property purchase that is situated on leased land. By definition, this means that if you purchase/own a leasehold property you own only the structure/property on the land, not the actual land beneath it. So…heads up (literally)! You only own what lies ON the land. It’s not your typical real estate transaction as you will always be attached to a lingering sense of uncertainty - what if the lease doesn’t renew? Or when it does renew, will there be new conditions? Can the leaseholder suddenly appear at my doorstep and rescind on the lease? These are excellent questions and all of which require your lawyer's involvement early on in the offer stage. DO NOT remove conditions on an offer without having your lawyer review the lease agreements (be sure to forward all documents and sub-sections associated with the lease - there could be many). And while your lawyer is reviewing the leasehold agreement, have your mortgage

Why don’t we start off with the definition of a Property Disclosure statement…and for the remainder of this talk I’ll refer to it in its abbreviated form, PDS: So here it is, the definition of a PDS: A document that is completed by the seller before listing their property on the MLS. The PDS was developed by the BC Real Estate Association and allows the seller to disclose details about their home to prospective purchasers (provinces across Canada have their own versions of this document, so look it up in your jurisdiction, or ask your realtor about it). Any latent (hidden/concealed) defect and/or patent (visible) defects should be disclosed in the document, particularly latent defects as prospective purchasers may not be aware of the potential defect just by viewing the property. The PDS is an ideal starting point when considering a purchase and is typically followed with a home inspection if the prospective buyer proceeds with an offer. The PDS is a critical document and should

When it comes time to renew your mortgage, most lenders will send you a renewal letter when there is 3 to 6 months remaining on your term. While nearly 60% of borrowers simply sign and send back their renewal without even shopping around for a more favourable interest rate, I would recommend you take a moment to check out your options.Rather than rewarding loyal clients with fully discounted interest rates, lenders tend to provide higher rates to renewing clients versus offering fully discounted rate specials to newly acquired clients. Generally speaking, the path of least resistance (when renewing your mortgage) often leads to higher interest rates. Instead, seek options and second opinions before accepting your incumbent lender's renewal offer. The outcome in doing so can result in thousands of dollars in savings over the course of your next mortgage term.It may turn out that your bank is offering a great rate, in which case you can accept the renewal and move on...but whatever you do, don't

How to get a bullet proof mortgage pre approval?In a hot market like we are in right now, mortgage pre-approvals have become front and centre…particularly, the quality and legitimacy of them. Here in Vancouver (and I am certain in Toronto as well), buyers are placing offers with no financing conditions…and even though I strongly advise against it, I continuously keep on getting subject free offers, one after another. So at the very least, my goal with this blog post is to make sure that people realize that the more work you put into the pre-approval process, the smoother and less stressful your time-restricted purchase process will be.Step 1 - Get your credit score where it needs to be and deal with any issues you currently haveStep 2 - Have your down payment funds confirmed and ready to goStep 3 - Understanding and selecting the right mortgage product for YOUR particular circumstanceStep 4 - Accept the fact that you will have to provide a large amount of documentsStep 5 - Get it all on PaperStep 6

Did you know? Approximately 15% of Canadians are self-employed, making this an important segment in the mortgage and financing space. When it comes to self-employed individuals seeking a mortgage, there are some key things to note as this process can differ from the standard mortgage.For self-employed individuals with an established business seeking best rate financing, the business must have a minimum two years of history. This includes self-employed applicants who own a full or part-time business in the form of sole proprietorships, incorporations, and partnerships.In order to obtain a mortgage when self-employed, most lenders require your most recent 2 years of Personal Income Tax documents; Notice of Assessments and T1 Generals. Typically, individuals who can provide these documents - with acceptable income levels – should have little issue obtaining a mortgage product and rates available to the traditional borrower.One primary benefit of being self-employed is the privilege of writing

The criteria for mortgage qualification involves fairly deep analysis of your personal income generation, your history of handling mainly unsecured consumer credit sources (like credit cards, lines of credit, car loans) and lastly, the amount of skin you have in the game - the down payment, or if refinancing, the current equity stake in your property. But the main driver and gatekeeper to all of the qualification tiers is the loan-to-value ratio (aka LTV).  Generally speaking, the higher your down payment (or equity position), the less rigid the qualification guideline.Here is a brief outline summary of the key LTV thresholds:up to 95% LTV - the least skin in the game, you will rarely (if ever) get exceptions from lenders. You are an inside-the-box applicant and need to fully comply with the standard qualification criteria. Regardless of which lender you team up with, the outcome will generally be the same...th

Rental Property Mortgages - how to qualify for them.Qualifying for a mortgage when purchasing or refinancing a rental property can get really confusing. Here are the key qualification criteria when qualifying for a Rental Property Mortgage:the minimum down payment to qualify for a rental property mortgage ranges from 20% to 35% (refinances are limited to 65% of the appraised value)rental income generated from the property does not necessarily translate into direct qualifying income. 50% to 95% of the rental income is eligible as qualification income (varies radically from lender to lender)the rental income eligibility is classified as either one of the following (depending on the lender and type of income):General Qualification Income (least preferred): the mortgage balance is maintained in the application and becomes part of the overall debt load that needs to be serviced for qualification purposes Offset Income (most preferred, best bang for your buck): the mortgage balance is removed from th

The Mortgage Cash Back Ladder: (for a $500,000 mortgage)1.0% cash back ($5,000) = 2.89% 5 year Fixed Rate, or 1.45% Variable Rate 1.5% cash back ($7,500) = 3.04% 5 year Fixed Rate, or 1.50% Variable Rate2.0% cash back ($10,000) = 3.19% 5 year Fixed Rate, or 1.60% Variable Rate3.0% cash back ($15,000) = 3.49% 5 year Fixed Rate, or 1.85% Variable Rate5.0% cash back ($25,000) = 3.94% 5 year Fixed Rate, or 2.35% Variable RateHere are some smart and useful ways to get the most bang from your Mortgage Cash Back proceeds:pay all or a portion of your closing costs (property transfer tax, legal fees, home inspection, movers, etc)use the proceeds to suit up your new place (furniture, new appliances, etc.)begin work on any renovation or home improvement projects (new paint, kitchen, bathroom, etc.)pay off high interest debt (credit cards, lines of credit, etc)invest the cash back proceeds in investments (rrsp, tfsa, stocks, etc)...basically, you can do whatever you desire with the proceedsBut what's the c

Click Here to be re-directed to the podcast blog for more detailed transcripts.Here is a summary outline of the key qualification criteria for Alternative Lending mortgages in Canada (formerly known as subprime mortgages):minimum down payment of 20% is requireddebt servicing ratios are as much as 35% higher than triple-A lenders (this means applicants can qualify for more mortgage)income qualification criteria is far less demanding than triple-A lender qualification guidelinesvery flexible to applicants who have a weak/damaged credit historyaccommodating to newly established self employed applicantshigher rates, shorter tems..."band-aid" or "transitory" mortgagesexpect a fee of 1-2% on the full mortgage balanceHere are some examples of common sense qualification:rather than requiring a recent pay stub and employment letter, an alternative lender may simply request 3 months worth of bank statements to verify income deposits into your bank accountin triple-A lending, self employed applicants require a minimum t

With virtually every economic indicator calling for rate hikes, Canadian mortgage holders are left wondering how to prepare and react to the already-in-progress wave of interest rate volatility. Regardless of the degree and timing of the pending increases, concerned mortgage holders in Canada have the opportunity to control their own destiny and minimize (or even eliminate) potential risks associated with rising interest rates (i.e. higher mortgage payments). Click Here to be redirected to the blog version of this episode.Contact Marko, he's a Mortgage Broker!604-800-9593 direct Vancouver403-606-3751 direct Calgarymarkogelo.comFacebook@markogelo (Twitter)MarkoMusic (SoundCloud Account)...all podcast music tracks are performed and produced by Marko See acast.com/privacy for privacy and opt-out information.

Buying a home while selling your current one?The transition from selling one property to purchase another sounds simple, but there are a few critical events throughout the timeline that you need to be aware of.Here are 6 key points to know when scaling up from one property to another: CLICK HERE to read the entire transcript (1) perhaps the biggest dilemma: SELL first, then BUY, or BUY first, then SELL?  (2) Use a Bridge Loan so you can gracefully transition from one property to another!  (3) Consider porting your mortgage, but ONLY if it makes sense!(4) secure a Home Equity Line of Credit on your current property BEFORE you list it for sale(5) call your existing lender and find out what your current mortgage balance and discharge fee will be(6) If you're planning to scale up at a specified time in the future, renew your current mortgage with the end in mindContact Marko, he's a Mortgage Broker!604-800-9593 direct Vancouver403-606-3751 direct Calgarymarkogelo.comFacebook@mar

Can BC Provincial Nominees qualify for a mortgage?Yes! A BC Provincial Nominee is eligible to qualify for a mortgage in Canada. Here are the key mortgage qualification criteria to be aware of when qualifying for a mortgage as a BC Provincial Nominee:you can purchase a property with as little as 5% down payment, but only for purchases under $1Mfor purchases that are $1M or greater the down payment increases to 20% and potentially higher depending on how large your purchase price is (down payment can reach up to 35% for purchases that exceed $2.5M)must have relocated to Canada within the past 2 to 5 yearsmust be employed for a minimum of 3 monthsfull income confirmation is required (recent pay stub and employment letter)a 90 day history of your down payment funds are required (i.e. bank statements, investment statements, etc). If you are unable to provide a 90 day history, then prepare to explain where the funds were derived from along with applicable documentation to verify so (i.e. from sale of

How to get the lowest possible mortgage payment?Sometimes life presents you with some expensive curve balls and before you know it your monthly budget creeps up and you're suddenly in a pinch. This happens to Canadians more than you can think and oftentimes the mortgage payment is looked upon as the primary means to bring you back to that financial comfort zone.Here are 4 ways to get the lowest possible mortgage payment:Request that your mortgage amortization be increased to its maximum. This can significantly decrease your mortgage payment, but it all depends on how your mortgage was underwritten with the lender it is currently with. For example, your amortization may currently be at 23 years and 8 months, but it possibly may have been underwritten at 30 years. If this is the case, your payment would be eligible for a drastic payment reduction.Convert all, or a portion of your mortgage into a Home Equity Line of Credit (HELOC). A HELOC payment does not include the principal portion t

Here is a breakdown of the the two types of variable rate mortgages:Capped Variable Rate Mortgage:the interest rate fluctuates when a lenders prime rate changesgenerally, your payment amount stays fixed for a determined period of time or up to a certain threshold of rate increases (as outlined by your specific lenders loan terms and conditions), however, the interest rate will fluctuate with any changes in Prime rate. If Prime Rate goes down, more of your payment will go towards paying off your principal; if the Prime Rate goes up, more of your payment will go towards interest costs rather than the principal pay down.Adjustable Variable Rate Mortgage:the interest rate fluctuates when a lenders prime rate changesyour payment amount adjusts automatically to reflect changes in the Annual Interest Rate and in the number of days in the month. This means your payments may change from payment date to payment date.Contact Marko, he's a Mortgage Broker!604-800-9593 direct Vancouver403-606-3751 dire

8 First Time Homebuyer Tips1) Be aware of the minimum down payment requirements5% up to $500,000, then 10% on the balance thereafter up to $999,99920% for $1M purchases up to $2.5M, then 40% on the balance thereafter2) Be aware of closing costsClosing costs are ancillary expenses throughout the process of completing your real estate transaction. In addition to your down payment funds, the lender will also request document verification for closing costs. All of the following costs are out-of-pocket and not included in overall mortgage:Pre-Closing Date Costs: Home Inspection Fee ($200-$400), Home Appraisal ($300-$400) Closing Date Costs: Land Transfer Tax (this will vary depending on city/municipality). In British Columbia, the property transfer amounts to 1% of the first $200,000, then 2% on the amount over $200,000 up to and including $2M, and 3% thereafter (i.e. for a $900,000 property purchase, your Land Transfer Tax would amount to $16,000).&

Intro (pre-amble): up to 13:10 mark of podcast (Canada's post election promises; tax the flippers, ban the foreigners, eliminate blind bidding, and increase the minimum down payment cut-off to purchase a home | is China's Evergrande shrapnel Canada bound?)Ok, so this isn’t necessarily the 100-step procedure on how to get a mortgage if you are new to Canada, but these are a summary of the most common pain points...so other stuff like income qualification I’ve left out because the criteria for income is pretty much standard and kinda common sense. So, here the the key qualification criteria to be aware of (if you are new to Canada and want to purchase a property):Make sure your funds/cash are ready to be cashed. This is critical in two ways; (i) to ensure that the deposit to place a competitive offer is ready for swift movement during the offer stage, and  (ii) equally important but often problematic is that the funds are fully verified by the lender (which leads to my next point) 

Pre-episode Talk (up to 11 minute mark): Modern Monetary Theory, Canada's inflationary path, and my thoughts on how to position yourself on the right side of a volatile economic environment. Episode Notes:Down Payment Sliding Scales:Over the years down payment guidelines have inserted a component within the qualification criteria known as "sliding scale". Oftentimes it could catch a buyer off guard when budgeting for a purchase leaving them scrambling for the unexpected shortfall in funds. The first bullet point below is the industry standard adhered to by all lenders in Canada, but the second bullet category varies with lenders and is scaled as per locations/regions and the lenders specific risk tolerances. For contrast, I've included the most competitive scales for Vancouver and Calgary.Minimum down payment thresholds for Vancouver:5% down payment up to $500,000 Purchase Price, then 10% on the balance that exceeds $500,000 up to $1M Purchase PriceEXAMPLE: for a $800,000 Purchase, the mi

With real estate prices soaring across the country many applicants are seeking assistance when it comes to qualifying for a mortgage.  More commonly, the assistance comes in the form of gifted down payments from the Bank of Mom & Dad, but coming in a close second these days is the addition of applicants to help combat the rigid income qualification criteria.  You have likely heard of the term, Co-Signer.  This is the 11th hour addition to a mortgage application (usually mom or dad) that gives the qualification effort that extra little boost required to get the main applicants over the hump.  But what many people don't know is that there are two types of co-applicants and various conditions and characteristics associated with each one; a Co-Signer and a Guarantor.  Here are the distinguishing factors of both:Key Characteristics of a Guarantor:Guarantors are usually added to an application when the main applicants can sufficiently qualify based on their income, but instead have some