Blog Archives - Dominion Lending Centres

Adapting Your Finances

August 4, 2022 By Administrator

The latest news has been focused on rising interest rates, surging inflation, and economic uncertainty with suggestions that the Canadian economy could be tripped into recession.

With all this information circulating, now is a good time to discuss ways to adapt your finances and protect your future.

Fortunately, there are a few key things you can do to get started today!

1. Set a budget and reduce monthly expenses and overall debt by including the following:

Review your income and expenses and identify areas for reduction - such as getting a cheaper cell phone plan, reducing streaming service subscriptions, reviewing transport costs, etc.
Make a list of your current high-interest loans (such as credit card balances). If your mortgage is up for renewal, you may be able to benefit by consolidating debt into your mortgage to save on interest and free up cash flow with one payment. Refinancing your mortgage before the renewal is also an option, but a review of the penalty cost versus your debt consolidation goal should be considered. As your mortgage professional, I can assist you with this analysis.
Allot a percentage of your income towards savings such as an emergency fund. Your goal should be to have the equivalent of 3 to 6 months of earnings in this fund to provide breathing room should you lose your job or face any unexpected expenses. Another form of emergency funds could also be a line-of-credit. Once set-up, these generally have no cost to you unless you use it in the event of an emergency.

Having a healthy and realistic budget will give you peace of mind and allow you to properly allocate your monthly cash flow between debt, expenses, and savings.

2. Evaluate your investment portfolio:

While you will want to avoid making any knee-jerk reactions, it maybe a good time to diversify your portfolio to help reduce risk. Consider rerouting your investment to real estate or other areas to ensure you have various sources of income and always talk to an expert.

3. Find additional income sources!

Many people have found innovative ways to increase their income by asking the following three questions:
1. Are you a fit for a potential promotion?
2. Do you have a review coming up?
3. Do you have transferable skills that you can apply to consulting or additional contract work?

One final reminder – don’t panic. I know the word “recession” can be stressful but understanding what is happening and making appropriate adjustments will help you stay financially secure.

If you have any additional questions, I would be happy to chat with you anytime! Please don’t hesitate to reach out if you want to discuss the impact on your mortgage, or how to make changes.

5 Renovations With the Best ROI

When it comes to home renovations, we know things can add up quickly!

If you’re looking to update your home or make some changes to your space, there are a few simple things you can do that are affordable AND have a great return on investment:

1. Fresh Coat of Paint: It is amazing what a fresh coat of paint can do for the interior and exterior of your home or space. It is affordable, easy to do yourself and typically has a 60% return on investment, especially when it comes time to sell
2. Refresh Your Floors - Flooring is the most worn element in any home. While replacing it may seem tedious, these updates tend to have a great return on investment garnering 100-150%. With options from updating carpet to hardwood, changing out your laminate or adding fresh tile to your bathroom or kitchen, new floors are an easy way to breathe new life into your home.
3. New Doors and Hardware - From installing brand new wood-stained garage doors to a statement front entrance to new baseboards and wainscotting or even a simple handle update, your home will feel fresh in no time! With a smaller WOW factor, even this minimal facelift can have a 50% return on your investment.
4. Updated Countertops and Cupboards - Kitchen renovations can typically be the biggest and most expensive, but they also have the best return on investment garnering a return of 75-100% after all it is the heart of the home. If you’re not ready to do a full kitchen renovation, consider updating your countertops and cupboard doors. You can expect to pay approximately $3,000 for granite or quartz countertops, which will freshen the space and make it look brand new!
5. Adding a Wooden Deck - Is your backyard functional? Does it scream summer get-together? If not, or if you think there is room for improvement, a great option can be adding a simple wooden deck! These can be built into almost any size or shape to suit your needs and is relatively affordable costing around $10,000 to $15,000 with a return of 80% when it comes time to sell.

If you’re looking to do a reno, contact me today about utilizing your home equity or refinancing your mortgage to apply funds to your new project!

Beat the Heat and Save!

Summer is finally here so be sure to enjoy it! To help you beat the heat AND save money while you do, here are some tips:

Use Portable and Ceiling Fans:

Instead of cranking the A/C (and your electricity bill) consider cooling down with portable and ceiling fans.

They can help ease the stress on your unit when used together or help eliminate the need for it all together. Portable fans work by creating a breeze, helping to circulate the air and causing a wind-chill effect that hits your skin and helps keep you cool. For an extra blast of coolness, place a bowl of ice in front of the fan to create a refreshing mist of air!

Avoid the Stove:

While cooking can be a great way to warm up the house in the winter, it will create unnecessary heat in the summertime. Instead, consider cold meals such as salads or breaking out the BBQ.

Keep the Curtains Drawn:

As nice as it is to let the sun in, this can increase the heat in your house and cause extra stress on your A/C unit and fans. Instead, keep the curtains drawn (at least on very hot days) to help your home stay cool.

Maintain the Air Filters:

As always, the change of the season is a good time to check the air filters in your home. Dirty filters slow airflow and make the system work harder, which can lead to expensive repairs down the road. Replacing your air filters every three months is ideal to keep dirt and dust out of your system.

Swap to Energy Efficient Lighting:

You have probably heard some of the reasons why LED lights have become so popular, but did you know that they also produce 75 percent less heat than incandescent bulbs, and can help keep room temperature down? This can help reduce monthly bills and keep your home more comfortable during the summer season!

What to Know About the Latest Interest Rate Hikes

July 11, 2022 By Administrator

With recent Bank of Canada interest rate hikes, and more on the way, here is what you need to know about how these policy changes affect your mortgage.

First and foremost, the interest rate hikes directly affect individuals that currently have an adjustable-rate mortgage.

Depending on your mortgage amount, you're looking at a potential mortgage payment increase of $40 per month for every $100,000 of balance owing. For example, if your mortgage balance is $400,000 then your monthly payment will increase approximately $160 per month.

As Canada’s lending prime has increased, variable rates increase as these rates are tied to prime. Payments need to increase to ensure the scheduled amortization remains the same. Hence you will still pay off your mortgage as the original amortization shows. For those individuals on a fixed-mortgage, you will not be affected by these interim changes outside of renewing your mortgage. If your mortgage is up for renewal, you will likely be renewing at a higher rate depending on your lender. If you’re still six months away from renewing, it may be a good idea to look into the options for early renewal to avoid getting caught up in another interest rate hike later this year.

All rates, fixed or variable are expected to rise more over the summer months. Please reach out to me today to discuss obtaining a rate hold. I can lock-in an interest rate for 90-120 days while you plan your next step whether it is renewing, purchasing or planning for changes.

If you're not currently a homeowner, but were looking at getting into the marketplace, it is a good idea to revaluate your budget and potential calculations for homeownership to ensure that your estimates are in line with the new interest rates. Download my mobile app My Mortgage Toolbox to play around with calculators and review your budget.

While interest rate hikes affect everyone, understanding the dollar value change for your situation and adjusting your budget accordingly, can help ease the pressure from increased mortgage costs. If you have any questions or are not sure what your next move should be, don’t hesitate to reach out to me today! I’d be happy to help review your situation and walk you through your options.

5 Things to Consider When Building Your Own Home

Building a new home is an exciting adventure but requires very different considerations. To help you have the best experience, here are 5 of the most important things to consider:

It’s All In The Numbers

Whether you are shopping for a pre-built home, or are looking to create your own from the ground up, it is vital to know what you can afford and stay within it.

This is the key to building a home that you will be able to enjoy for the next 20 or 30 years, while still maintaining your financial stability.

Overall, the average cost to build a house can range $300,000 to $350,000 for 1,000 square feet to double or triple that amount. For example, an average 2,500 square foot home could cost between $500,000 and $875,000 to build depending on materials, design, etc. Keep in mind, these costs don’t include the land or taxes on the construction and material.

Choose a Reputable Builder

This one seems pretty straight forward, but when you start looking it can quickly become overwhelming when you realize how many options there are. When it comes to determining the head contractor for your project, careful research is needed. Another option is to consult friends and family members who have gone through the process, or ask me, your mortgage expert and/or your realtor! They often have many qualified contacts in the industry or can help point you in the right direction.

Build a Home For Tomorrow

As tempting as it can be to personalize your home to the nth degree and include every cool little feature you can think of, it is important to always keep resale value and practicality in the back of your mind. Life can often throw a few curve balls that, for one reason or another, may result in your having to sell your home in the future. If that time should ever come, you will want to be able to appeal to all buyers easily and not have to hold the house longer than necessary. Ask yourself if the features you are putting into your home will appeal to others, and also if the design suits the neighborhood you are building in as well.

Go Green!

Now more than ever before energy efficient upgrades are easy to add to your home. To make your home as efficient as possible, it is important to incorporate these options into your design BEFORE you start building. Options such as energy efficient appliances, windows, HVAC systems, and more can save you money in the long run and may also make you eligible for certain grants and discounts. For instance, the Canadian Mortgage and Housing Corporation (CMHC) green building program rewards those who select energy efficient and environment friendly options.

Understand The Loan

Lastly, beyond the costs and design of building a new home, what does a mortgage look like for an unbuilt home? I suggest you provide me with a budget that includes both hard and soft costs, as well as the reserve of money you plan to have set aside in case you run into unexpected events.

Requirements for capital

A common mistake that many people don’t realize is you need capital upfront. The capital is needed for the initial down payment on the land/lot, as well as city red tape and permits to start the construction and throughout the build. It’s personal capital that is needed to finance the build to each stage of the construction. The draw mortgage will then advance money (the draw) to pay back the funds used to hit that stage of construction. For example, your capital finances the foundation of the home then the mortgage draw will advance funds to pay back that foundation capital. Then capital is used to get the house to the next draw stage which is generally framing, roofing, doors and windows (knows as “lock-up”) then the mortgage draw pays back the funds used to achieve the stage and so forth.

It is also important to note that the lender will consider the appraised value of the finished product. This value is determined before the project begins. In this example, the completed appraised value of the home would have to be at least $600,000 to qualify. In addition, the client will have to come up with the initial $150,000 to be able to finance the total cost of $600,000.

Additional Notes

When it comes to building your own home and construction loans, here are a few extra things to keep in mind:

Make your building plans in advance and stick with them to avoid costly changes during construction.
Depending on the lender, you may have a time frame within which you need to complete construction (typically between 6 and 12 months).
Construction loans are usually fully opened and can be repaid at any time.
Interest is charged only on amounts drawn; there are no “unused funds”
Once construction is complete and project completion has been verified by the lender, the construction mortgage is “moved over” to a normal mortgage

If you’re looking to build a home, don’t hesitate to reach out to me for friendly mortgage advice!

Throwing the Perfect Summer Social

There’s something magical about summer and no matter where you live in Canada, summer is the perfect opportunity to spend a little time with family and friends. Nothing says party vibes more than food on the grill and summer drinks flowing.

Whether you live in a country house, a suburban townhome or a city condo, gather your crew and remember these essentials:

Good Eats

To have the most success with your backyard party, you must pre-plan! This includes organizing an easy menu with bite size snacks, easy salads and flavour packed options to keep your guests satisfied. And don’t forget to make sure the barbecue has plenty of propane!

Cold Drinks

A cooler full of pop and water is a great start for a summer day! If you’re hosting adults, add a little alcohol to the mix! Boozy lemonades or spiked ice teas are easy to make and very fun to drink. Craft beer, ciders or chilled white wine are other fun options for a hot day!

Did Someone Say Dessert?

If you’re planning an all-day affair, you might want to keep some quick and easy desserts or snacks on hand for the evening. Homemade ice cream bars, fruit kabobs or a veggie platter, or even chips can make great options for any peckish guests. And as the sun sets, you can break out the marshmallows and get your s’mores on in front of the fire!

Decor & Ambiance

For suburban hosts, your backyard party would include a sitting area, maybe umbrellas to offer some shady spots and some water fun! However, if you find yourself in smaller city digs, that doesn’t mean your party still can’t be one for the ages. Consider throw pillows, paper patio lanterns and plastic glassware which are all affordable and easy to find to help create that perfect party space!

Choosing Your Tunes

While music can set the ambiance, you need to know your guests. It’s not easy to pick a playlist that will appease all ears, but streaming services like Spotify and Apple iTunes have plenty of mixed playlists that should do the trick. Or search for Dominion Lending Centres on Spotify!

Entertainment

Backyard games such as a bocce ball set, Frisbee and even a football can keep the fun and competition going for hours! If you’re looking for a more chill hang, consider setting up a card table or some board games for those who want to partake.

For the Kids

If your party involves kids, you’ll want to keep the food simple and easy to eat with hands, so burgers, hot dogs, chips and watermelon are the way to go. You’ll also want to keep them occupied with simple games or more active options such as a soccer ball, mini trampoline or a sprinkler to run through and keep them cool. When daylight starts to fade, you can set up a backyard movie or camp-out with some tents to settle the night down.

New to Canada?

July 4, 2022 By Administrator

Canada has seen a surge of international migration over the last few years. With all these new faces in town wanting to plant roots in this great country, it’s a good time to review some of the details surrounding mortgages and how individuals new to Canada can qualify to be homeowners.

Check out some details below on how to get your first mortgage in Canada!

If you are already a Permanent Resident or have received confirmation of Permanent Resident Status, you are eligible for a typical mortgage with a 5% down payment - assuming you have good credit.

If you have limited credit, or have not yet qualified for Permanent Residency, there are still options! In fact, there are several ‘New to Canada’ mortgage programs through CMHC, Sagen™ and Canada Guaranty Mortgage Insurance. Please note, for these programs you will typically require a valid work permit is valid up to 3 months post-purchase date.

To qualify for these New to Canada programs, you must have immigrated or relocated to Canada within the last 60 months and have had three months minimum full-time employment in Canada.

For 90% credit, a letter of reference from a recognized financial institution OR six (6) months of bank statements from a primary account will be required.
If you are seeking credit of 90.01% to 95% you need an international credit report (i.e: Equifax) demonstrating a strong credit profile OR two alternative sources of credit (i.e.: hydro/utilities, telephone, cable, cell phone or auto insurance) demonstrating timely payments (no arrears) for the past 12 months

Depending on your residency status and credit history, another option are alternative or private lenders as well who can fund your mortgage.

If you are unsure of your options or want to make sure you get the best mortgage product possible, please don't hesitate to contact me. As a dedicated mortgage professional, I have access to dozens of lender options, which will allow me to find you the best options. I would love to set up a virtual appointment to discuss your financial history, goals and the mortgage process.

Thinking of Moving? Tips for Selling in Today’s Market

The housing market continues to favor sellers as we move into the summer months. If you’re thinking of selling, this is a great time to do so! Not only will your home likely be listed on the market for a shorter period of time, but most sellers are currently receiving multiple offers on their sale. This is due to the increasingly high demand for housing with limited homes currently available on the market.

However, even in a seller’s market, there are some things you can do to help improve your chances of selling your home and getting the best offer! Here are some tips for selling your home in a seller’s market:

List Your Home on a Friday

Depending on the location, Friday is typically the best day of the week to put your home up for sale. Most individuals have weekends free or can take Friday's off early should they be interested in a home for sale! Be sure to include multiple photos of the home in your listing, or even a virtual tour video if possible, to get your listing off on the right foot.

Offer Limiting Showings

Another good strategy for maximizing your offers in a seller's market is to limit your showings. Restricting the hours and days that you show your home will allow you to have multiple buyers touring at the same time, which tends to create quiet competition as the buyers know other individuals are interested.

Lower the Sale Price

While not always necessary, lowering the sale price can make your home even more attractive to potential buyers. If you get multiple buyers interested, it will leave some wiggle room for buyers to bid over the asking price.

Make the Most of a Bidding War

If you do end up with a bidding war on your home, you will want to make the most of it. Firstly, always inform buyers of the competition and encourage stronger offers. Secondly, respond to one offer with a counteroffer and set the others aside until you get a response. Thirdly, accept the best offer.

However! Keep in mind that the highest offer might not always be the best one. Some things to keep an eye out for that are conducive of a 'strong' offer include: a cash offer, a large down payment, few to no conditions and a flexible moving date.

If you’re looking to sell this year, make sure you utilize a top realtor who can help you navigate the current market settings so that you get the most out of your home! And don’t forget to reach out to your mortgage professional for all the information around moving and how that affects your mortgage.

Summer Backyard Reno Ideas

With summer underway, it might be time to consider a backyard upgrade! These don’t have to be luxurious or expensive, but a couple tweaks can give your yard a facelift and make your outdoor space feel brand new!

Check out my backyard renovation ideas below:

Revive Your Deck

You don’t necessarily have to tear it down and start over to have a fresh deck. Chances are the structure is in good shape. A remodel job featuring new decking, rails and stairs can save a ton of money over a full rebuild.

Generate Your Own Zen Space

If you enjoy spending time in your yard or on your deck, but are finding that nosey neighbours, traffic noise or barking dogs are impacting your serenity, don’t fret! A privacy fence is a great option to replace sections of your existing railing and make your deck more private, quiet and comfortable!

Relax with Water Sounds

If you have space in your yard for a unique water feature, such as a fountain, pool, artificial waterfall - or even a cute pond! - this can make your space feel that much more magical.

Set the Mood

When it comes to setting the mood for your backyard space, proper lighting can go a long way. From string lights to lanterns or path lighting, the options are endless (and affordable!) allowing you to create the perfect summer escape.

Create Your Perfect Pathway

Another great way to give your backyard a quick makeover is to add a practical walk path. Gravel is the easiest to handle and the least expensive option. While it looks less formal than brick or stone, it can be complemented with a stone or flower border for that extra appeal.

Reverse Mortgages and What to Know

May 3, 2022 By Administrator

Many Canadians are looking to retire but are currently facing high debt load and ongoing expenses, as well as reduced income. This can be a challenge. A reverse mortgage can help! Canadians can access up to 55% of your home's equity and convert your home equity into cash.

Stay in the Comfort of Your Home

This product is also a great option for anyone wanting to assist their elderly parents. Instead of selling the home and having to move to a care home or downsize, parents can keep their home. A reverse mortgage is a terrific way to access the equity in the home, month by month, to pay for in-home and ongoing care costs.

The goal of the reverse mortgage is to allow Canadians over 55 years to tap into the equity of their home. This assists in comfortable financial living. With a reverse mortgage borrowers are not required to make regular payments. This allows them a considerable inflow of cash, without having to pay off what they owe! The only time payment will be required is when you sell or move out of your home.

Access up to 55% of Your Home's Equity, No Monthly Payments

Reverse mortgages are designed to allow you to access up to 55% of your home's equity. Thereby allowing you to convert your home equity into cash. This can be done as either a one-time lump sum payment. Or you can choose to structure it to receive monthly payouts. Beyond being able to cash in on your home’s equity, a reverse mortgage has additional benefits including:

No monthly mortgage payments
No income or credit qualifications
Very low / little paperwork required
Title and ownership of property remain in homeowner’s name
Flexible options to break term early if needed
Penalty waived in the event of death or care home placement to preserve the estate

If you are struggling financially, or want to have a little extra equity on hand to pay off existing debts, gift money to family, expand your quality of life or simply increase your investment portfolio, contact me today! I would be happy to discuss the possibility of a reverse mortgage in further detail with you and ensure it is the best product to suit your needs.

Dreaming of a Home Away From Home?

If you are dreaming of your very own vacation home, there are ways to make it happen! Let me walk you through your options.

When it comes to taking on a vacation property, you will need to have a minimum down payment of 5% of the purchase price. If you are purchasing a non-winterized vacation home, or will not have year-round access, then you will be required to put down 10%.

You must also have sufficient credit score to qualify if not putting 20% down. In addition to the down payment, you will also need to pass the stress-test and prove that you can financially carry the mortgage of your existing live-in home and your new vacation home. For more information on spending your winters in Florida click here.

Refinancing

When purchasing a vacation home or property, most lenders will allow you to borrow money against the equity you have in your current home and use it as a down payment for a second home. This is called mortgage refinancing. Mortgage refinancing means getting a re-evaluation on your home and then redoing your mortgage based on the current value. This will allow you to tap into the equity your home has built over the years, and pull out the extra funds for a down payment on your secondary property. Keep in mind, when using some of your current equity, it will increase the principal amount and the interest payments on your mortgage as the mortgage is now refinanced at a higher amount.

Home Equity Line of Credit

Another option to unlock your home equity is through a line of credit or a HELOC (Home Equity Line of Credit). This option allows you to borrow money using the equity in your property, with the property as collateral. A HELOC serves as a revolving line of credit to allow the borrower to access funds, as needed, letting you utilize as much (or as little) equity as required. In Canada, you are able to borrow up to 65% of your home’s value using this method. Keep in mind, your HELOC balance AND current outstanding mortgage cannot exceed 80% of your home’s value when added together.

If you are ready to purchase a vacation property, I would love to help review your financial situation! I would be happy to take a look at your current mortgage, equity and review your options to help you find the best fit. The keys to success are right around the corner with a little bit of expert advice.

Home Security Tips

Looking for some tips to improve your home security?

While there are many things you can do, the security you choose will depend on your comfort level and preferences.

Check out these ideas below to help get you started!

Reinforce the windows on your first floor with window stops
Use deadbolts instead of spring-latch locks.
Frost the windows on your garage to avoid wandering eyes.
Install motion-detector lighting outdoors to shine a light on potential intruders.
Keep your shrubbery short to avoid giving intruders hiding places.
Install security sensors in any detached buildings, like a garage or pool house.
Install door reinforcement hardware on any outward facing doors.