Christine Buemann Mortgage Broker

RBC announced this morning that their rates are on the rise. Will other lenders be soon to follow? Get your 120 day rate holds now! http://www.theglobeandmail.com/globe-investor/rbc-boosts-mortgage-rates/article4490037/ www.christinebuemann.com

As most people know, with the new regulations that took effect last month maximum amortizations for insured mortgages were reduced to 25 years. It is important to note that this will apply to any mortgage where less than 20% is being used for the down payment, but also for mortgages which are “bulk insured” (which basically means that the lender is still insuring it, but they are paying the premium). Some lenders are still offering 30 or even 35 year amortizations on their uninsured mortgages. You may ask yourself – why would someone want a 35 year amortization anyways? One of the most common reason is for qualifying purposes. If you were looking to qualify for a *$200,000 mortgage over 25 years , you would need at least $42,000 in income. If you lengthen the amortization to 35 years , you would only need approximately $36,000 in gross annual income. The key to this strategy is to set your payments from the first payment as the same amount as they would be with the 25

If you are considering applying for a mortgage, it is very important that you have all of your documents and personal information gathered prior to going in so that you’re Mortgage Broker has accurate numbers to submit in your application.   Since the major determining factor for your maximum mortgage amount is your gross annual income, that information is extremely important. Most people are able to access recent paystubs and employment letters fairly easily, but they may not have their tax information on hand. Depending on your employment situation, some lenders will require copies of your T4’s and/or Notice of Assessments for the past 2 years. If you cannot find them, they can easily be re-sent to you by Canada Revenue Agency by calling 1-800-959-8281 or by setting up a CRA online account. The online account for CRA is great as it gives you constant access to your information and the ability to re-print any old statements. You can register at http://www.cra-arc.gc.ca/myaccou

There was an article published in the Globe and Mail last week that addressed a common concern. That concern is for borrowers who are looking to obtain a mortgage from a smaller   or less recognizable lender. Although many people have only heard of the "Big 6" banks, there are many lenders who deal exclusively in mortgages. They do not have the overhead costs of the day-to-day banking and can generally offer lower rates without taking away any important features (portability, assume ability ext.). They are also accessible through a Mortgage Broker who will work for you and can help you determine what your best options are as opposed to someone who works for the bank. Many of these lenders have been around for years and have very reputable track records. People also tend to recognize banks which have a physical branch in their communities. There are however, several very large banks who may provide a higher quality service but simply do not have a branch at that location.