1. NEIGHBOURHOOD MORTGAGE
O C T O B E R 2 0 1 3
strategy
Mortgage brokers offer choice
TOP REASONS FOR USING A BROKER
1. Choice – access to multiple financial institutions
2. Knowledge – brokers stay up-to-date on
available products and services
3. Flexibility – mortgage products are even
available for the self-employed or those who
have credit blemishes
1140 Stellar Drive
Newmarket, Ontario L3Y 7B7
FROM YOUR ACCREDITED TEAM OF MORTGAGE PROFESSIONALS - NEIGHBOURHOOD DOMINION LENDING CENTRES
FROM YOUR ACCREDITED TEAM OF MORTGAGE PROFESSIONALS - NEIGHBOURHOOD DOMINION LENDING CENTRES
905.715.7086 | Visit Us On The Web: www.ndlc.ca
The next time you’re looking for a mortgage for that new
house or you’re up for renewal on your existing mortgage,
think about using a mortgage broker – their services are free
andtheyofferyouanabundanceofchoicesthebankssimply
can’t compete with.
Mortgage brokers have access to a vast array of lenders
including the big banks, over 35 financial institutions, trust
companies, credit unions and even private funds – which
enables these professionals to negotiate the best possible
mortgage products and rates on your behalf. In comparison,
ifyouapproachyourbankwithamortgagerequest,theycan
onlyofferyouanarrowchoice–namely,theirownproducts.
Mortgagebrokersdotheirhomeworkonavailablemortgage
products and keep themselves abreast of any new products,
or changes to existing products, to ensure they find the best
mortgage to fit your specific needs.
Unlike the banks, mortgage brokers can also cater to self-
employed borrowers as well as those who have suffered
credit blemishes due to life experiences such as divorce or
illness. Brokers will listen to your story, whereas the banks
haveaverynarrowviewofwhatfitsintotheirfinancingbox
– and this is unnegotiable.
If you’re thinking of buying a home, Neighbourhood
Dominion Lending Centres mortgage professionals can find
the best mortgage rate and term for your unique situation.
2. Using Home Equity to Your Advantage
As we read reports, listen to the radio/TV and we start to wonder if the financial crisis has bottomed out.
We have heard rumbles that the American government is going to stop purchasing bonds which will have an
effect on you, as it will make money more expensive to borrow.
The rules have changed drastically over the last 4 years and have made it more difficult for the average
Canadian to leverage the equity in their homes to reduce their debt, purchase a 2nd home or cottage.
Now we should take a look at this one more time.
Canadians purchase homes for a
variety of reasons. Some want the
stability of owning their own
home, while others also look at
home ownership as an investment
vehicle. No matter what the rea-
son, the truth is that home own-
ership has proven itself to be a
good stable investment over time,
and one which many Canadians
are profiting from.
While many people have chosen
to purchase their first home dur-
ing these times of lower interest
rates, there has also been a large
movement to refinance home
loans and pull out equity for home
improvements, investments, col-
lege expenses, and even high in-
terest debt consolidation.
Canadians have been borrowing
against their home’s equity in
record numbers, taking out bil-
lions of dollars in cash each year.
In years past, many saw their
homes as a shelter of safety, yet
today, they are more than ever be-
fore willing to borrow against the
equity owned in their homes to
further their investment portfo-
lios, get out of debt, send their
children to university, make im-
provements to their home, or
even boost their RRSP contribu-
tions. Where home equity was
once sat upon, today it is some-
thing to be tapped out and used
to one’s advantage.
While tapping the equity in your
home can be a good idea, you
should do so with caution and un-
derstand any of the possible con-
sequences. The best thing you can
do is consult a licensed mortgage
professional and financial planner
to discuss opportunities to make
your home’s equity work for you.
* Mortgage originally $250,000
** Based on a mortgage with 12 months remaining on term
*** 21 years remaining on amortization
Rates subject to change | O.A.C. | E. & O. Call Us To Get Started Today!
905.715.7086
Is it time to refinance our debts?
Current Situation On Renewal Potential Situation
of Mortgage
Mortgage at Mortgage at Mortgage at
5.5% interest rate 3.59% interest rate** 3.59% interest rate***
(21 year) (25 year)
Balance Payment Balance Payment Balance Payment Payment
Mortgage* $234,668 $1526 $234,668 $1334 $306,446 $174925 $157548
Car Loan $30,000 $524 $30,000 $524 - $0 $0
Credit Cards $18,000 $540 $18,000 $540 - $0 $0
Line of Credit $20,000 $600 $20,000 $600 - $0 $0
Penalty to break $3,788 $0 $0 $0 - $0 $0
mortgage
Total $306,446 $3190 $302,668 $2998 $174925 $157548
That’s a MONTHLY SAVINGS of $124875 $142252
3. Visit us on the web:
www.ndlc.ca
Have you ever said “what a beautiful
home with a great piece of property,
too bad the kitchen is outdated?
Well you are in luck. There is a
program that not only opens the
door for you to get into the home,
with the dream kitchen, or spa like
ensuite, but it also saves you any
inconvenience, or hassles of
arranging a second loan after the
closing. This program is available
with Genworth or CMHC “Purchase
Plus Improvements” mortgage. Now
you can purchase a home, renovate
it the way you like and pay for it all
in one mortgage payment at first
mortgage rates.
All of this can be done by putting
down as little as 5% of the “as
improved” value. For example, if you
purchased a home for $375,000 and
wanted to do $25,000 worth of
renovations, Genworth/CMHC will
insure a mortgage based on 95% of
the “as improved” value. In other
words, with a down payment of
$20,000 (5%) Genworth/CMHC will
insure a mortgage of $380,000.
The key for this working is that the
cost of the renovations has to be
reflected in the “as improved” value
of the house.
In this example, Genworth/CMHC
would have to agree that the house
would have a value of at least
$400,000 after the $25,000 worth of
proposed renovations was done. The
insured loan will be based on the
lower of the purchase price plus the
actual cost of improvements or the
“as improved” market value.
How Does It Work?
When you’ve decided to make an
offer on a house, make the offer
conditional for a longer than normal
conditional period because you will
have to arrange a qualified
contractor to put together a
description and a cost estimate for
the proposed repairs or renovations.
Forward the “Contractor’s Estimate”
along with the “Agreement of
Purchase and “Sale” for submission
to the lender for Genworth/CMHC’s
approval.
The following information needs to
be prepared by the contractor to be
submitted along with your
application to the lender.
Renovations
(i.e. Kitchen or Bathroom renovation)
1. Description of the work
2. Types of materials being installed
with applicable quantities (i.e. 250
sq. ft. ceramic flooring)
3. TOTAL COST of all work (include
applicable taxes)
Important Reminders
1. Make the offer conditional for a
longer than normal conditional
period, 10 business days
2. Get estimates immediately after
accepted offer
3. Full application cannot be
submitted until estimates are in
4. All work has to be completed and
receipts submitted together to
release funds
5. A walk-through appraisal maybe
required at the borrower’s
expense
For additional information on the
Purchase Plus Improvements Program
or if you have any questions, please
don’t hesitate to contact us!
Purchase Plus Improvements
!
DID YOU KNOW...
Neighbourhood Dominion
Lending Centres has a great
line of Visa cards that you can
apply for directly through our
website or by calling/emailing
us today. The Dominion
Lending Centres Student Visa
is the perfect back-to-school
accessory. It features a
competitive interest rate and
no annual fee, as well as a
unique cell phone insurance
feature to protect students
from having to pay for a new
phone if theirs is lost or stolen.
Give us a call today to see if we
have the right card for you!
In today’s market it is as critical
as ever to make sure your
financial plan is still working
for you! A Neighbourhood
Dominion Lending Centres
mortgage professional can
quickly evaluate your situation
over the phone and can ensure
you have the best mortgage
product available. Call today
for a free check-up!
When was the
last time your
mortgage had
a check-up?
