With the changing of the seasons, it can be a good time to take stock of your home and ensure you are ready for the colder weather. To help you feel more comfortable, save on bills and prevent future repair costs, there are some simple things you can do to prepare for the coming season. Tending to minor problems yourself, or booking a professional now, will save you time and aggravation later when poor weather makes it harder to tackle home maintenance jobs.

• Service Your Heat Source: Before Winter starts, be sure to have a professional check and clean your heat sources. You should have your chimney cleaned out if using wood heat or make sure to update your oil heater’s filters and service gas furnaces regularly.
• Check Your Pipes: Checking pipe joints for leaks that could cause rot and damage will save you trouble in the future. Repair any cracks you find, especially those around electrical outlets and alarm system lines. You can also consider foam pipe insulation, which is fairly easy to install and could help prevent energy loss and potential water damage from frozen pipes.
• Mind the Gaps: Search exterior window frames, doors and siding for cracks and gaps where water could get in. Doors and windows commonly have gaps that let cold in and heat out. Some will be easy to fill or fix yourself but could save you money and damage down the line!
• Insulation is Key! On a snowy day go outside and look at your roof; you should see snow on the roof. If you can see your roof that means the attic is not insulated well and heat is escaping and melting the snow. If this is the case, you will want to have it repaired and packed to ensure you are not losing excess heat during the winter months.
• Create a Storm Kit: A storm kit is a handy source of essential items in the event of losing power. Consider what you and your family might need, such as a flashlight with new batteries, candles, matches, a portable radio, water and snacks. Keep your kit somewhere easy to access!

Credit for this blog: Dominion Lending Centres

Talking about money is one of the last taboos and can make people feel very uncomfortable – a feeling that’s only amplified when it comes to talking about your parents’ money. However, when a conversation’s difficult, that normally means it’s worthwhile having; and getting transparency on your parents’ financial situation can help you help them make the best financial decisions for their future.

If you think a reverse mortgage would be beneficial to your parents, we’ve put together some top tips to help you broach the topic with them.

SENSITIVITY IS KEY

Your parents may feel uncomfortable talking about their finances with you, especially if they have any worries regarding their situation, so be sure to approach any financial talk with sensitivity. Listen to them, show empathy, give them the space to speak, and show your willingness to help them find the solution that works for them.

You might also want to reassure them that you have no expectations regarding inheritance and that you’d rather they live their retirement the way they’ve always wanted.

CHOOSE THE RIGHT TIME

Conversations around finances mustn’t be rushed so set a date for the conversation when you both have plenty of time. If possible, meet up face to face and give the conversation your full attention – don’t do chores as you talk.

START THE CONVERSATION RIGHT

There are several ways of broaching the topic of reverse mortgages with your parents. If you’re comfortable being direct, you could simply ask: “Mom, are your finances ok?”.

If you’d rather be more subtle, you could start the conversation in a more roundabout way. Perhaps you could ask about the house and whether there’s anything they’d like to update, or maybe you ask about their retirement and whether they’re able to do all the things they’d like to.

These conversations can lead naturally into a discussion about monthly income, assets, and savings and provide an opportunity to explore how the reverse mortgage can help them increase their cash flow and boost their standard of living – all while staying in their own home!

COME PREPARED

While you don’t need to prepare an entire script, it’s a good idea to think about what you’ll say beforehand. Do some research on the CHIP Reverse Mortgage and get a clear idea of how it would benefit your parents. Think about the questions they might have and come up with some answers.

It’s also a good idea to bring resources with you such as a CHIP Reverse Mortgage brochure or our new book Home Run: The Reverse Mortgage Advantage, which takes a deep dive into using reverse mortgages as a strategic retirement tool.

FOLLOW UP THE CONVERSATION

Don’t ask for a reaction or any kind of decision right away. Give your parents time to digest what you’ve spoken about, re-read any information you’ve given them, and think about any questions they have. Don’t expect one chat to accomplish everything, follow up in the next few days with a call.

Talking about finances is difficult at the best of times – even more so when the finances in question are your parents’. But hopefully, with the help of these tips, it’s a conversation you’ll now find easier to have.

If you’d like to find out more about how the CHIP Reverse Mortgage can help your parents live retirement their way, contact a DLC Mortgage Professional today!

Written By: Sue Pimento
Post Sponsored by HomeEquity Bank

Selling your home can be an extremely stressful experience. Between thinking about moving logistics and financials, it’s easy to miss the small details in between the process.

With that in mind, we’ve built this checklist for selling your home to help you keep track of the things that will get a potential buyer interested. Turns out, it’s not as simple as just fluffing pillows or doing a light dusting. “Put your buyer’s hat on and walk through your home like it is the first time,” Marilou Young, an Accredited Staging Professional and an Associate Broker with Virtual Properties Realty in the metropolitan Atlanta area, told Forbes.

Below is the ultimate checklist for selling your home.

GET FAMILIAR WITH THE PAPERWORK

For home sellers interested in the history of the house, make sure you’ve got all the information handy; this can include paperwork on renovations, property tax receipts, deeds and transferable warranties.

GETTING THE PRICE RIGHT

According to HGTV, it can be helpful to do some market research on what homes in your area are selling for- then shave 15 to 20 percent off that. This way, you attract multiple buyers who can end up outbidding each other and bringing up the price. While that can seem like a risky move, it could work in the competitive markets of big Canadian cities.

DEPERSONALIZE AND DECLUTTER

You want potential buyers to see themselves in the space, which is hard to do if you have family photos on the wall or personal items around. This would be a good time to start putting items in storage or try to keep your personal items out of sight. At the same time, you’re also ensuring that you’re keeping your house tidy—a must if you want to make your home sellable. Check around the house for dirt, stains or small cracks you might be able to fix. And if you have pets, make sure their litter boxes and play areas are also clean and odour-free.

FIND A QUALIFIED REALTOR

Realtors can be helpful to take some of the processes off your plate, including marketing your home and arranging open houses. If you do go this route, none of this list will matter if you decide to work with a realtor that doesn’t know the market inside out. You can search their name on the Real Estate Institute of Canada to ensure that they’re qualified, and meet with them to see if you mesh and understand how they price your unit. At Proptalk, we also have this handy guide for more details.

DON’T SKIP THE HOME INSPECTION

While presenting an unconditional offer may win you the home of your dreams, it can also end up costing you more than you expected. If you’re mortgaged to the max, you can’t afford surprises like repairs or replacements that you haven’t already budgeted for. Consider a Home Protection Plan that includes an 18-month warranty and up to $20,000 in warranty coverage for major household features such as foundation, roof, heating and cooling.

A down payment is one of the most essential aspects of every mortgage application and new home purchase. In Canada, home purchases require a minimum cash payment from your own funds that is put towards the purchase. This is your down payment and is considered your stake in the deal.

Many home buyers understand that a certain amount of money down will be required on a home. However, most don’t realize the ins-and-outs of down payments, such as where the funds are allowed to come from and ensuring a proper paper trail.

Here are a few things to keep in mind while preparing your down payment and working towards your perfect home!

SOURCES OF DOWN PAYMENT

Most home buyers are aware that they will require a certain amount of money for a down payment. What many do not realize, is that lenders are required to verify the source of the funds. This allows them to ensure that they are coming from an acceptable source. Sources that further contribute to indebtedness are less-likely to be considered (such as line of credit or credit card). Instead, the best and most traditional options for your down payment are:

SAVINGS ACCOUNT

The first and most traditional method is your savings account, where you have been pinching your hard-earned pennies to save up for this day!

If you are utilizing your personal savings for a down payment, note that lenders will require three months of full bank statements. This includes name, account number, transactions and balance history. For any large deposits made in that time (sale of a car, work bonus, etc.), explanations and supporting documents will be required.

GIFT FROM FAMILY MEMBER

If you are fortunate enough to receive help from the Bank of Mom and Dad for your down payment, there are certain requirements:

• A signed gift letter from the immediate family member contributing the fund
• Proof of the transfer into your bank account. This can be a bank statement documenting the money being moved from the donor’s account and into yours. The statements must include names, account numbers and the full transaction history during the time period in question.
• Important note: If money is being received from immediate family overseas, most lenders will require copies of the wire transfer. In addition, they may ask for account history.

RRSP WITHDRAWAL

Another option for down payment is the use of Registered Retirement Savings Plan (RRSP), but only if you are a first-time buyer. This is part of the Home Buyers’ Plan (HBP), which allows first-time buyers to borrow up to $35,000 from their RRSP’s (tax-free!) -as long as the money is repaid within 15 years. Please note: The minimum repayment is 15 equal instalments paid once per year.

HOW MUCH DOWN?

When it comes to putting money down on your new home, you need to consider the minimum down payment required as well as additional fees.

The minimum amount required in Canada is 5% for the first $500,000, with 10% down on any amount beyond that threshold. For example, on a $600,000 house you would need to put $35,000 down at minimum ($25,000 on the first $500,000 and $10,000 for the additional $100,000 purchase price).

Keep in mind, if your down payment is less than 20% of the price of your home, you will be required to purchase mortgage loan insurance in case of default. These premiums range from 0.6% to 4.50% of the total amount of your mortgage. Using the example above, this would mean $3,600 to $27,000 in mortgage insurance premiums.

If you are able to put 20% down on your new home (which is the recommended amount), you would be looking at an investment of $120,000 down with no mortgage insurance premiums required.

ADDITIONAL COSTS AND FEES

One component of the purchase process that homeowners often forget about, are the closing costs. These are typically 1.5% up to 4% of the purchase price. In order to get financing, you are required to show that you have enough to cover these costs, which include legal fees.

When you have collected the funds for your down payment and closing costs, you must ensure those funds remain in your bank account once you’ve provided confirmation. They should only leave your account when they are provided to your lawyer to complete the purchase. This is because lenders will often request updated statements closer to the closing of the sale, to ensure nothing has changed. If money has been moved around, or if there are new large deposits or withdrawals, they will all need to be confirmed and could affect approval.

The last thing that anyone wants when purchasing a property is added stress or for something to go wrong late in the process. Consider contacting a DLC Mortgage Professional today to help guide you through the process! Make sure you are upfront about your down payment amount, and where it is coming from. This will help a mortgage broker determine whether or not it is suitable, and allow them to find the best lender and mortgage product for you!

25 Secrets Your Banker Doesn’t Want You to Know.

Twenty-five or thirty years can sound like an impossibly long time to service a loan – and for many of us, it is. If you are looking to pay off your mortgage faster, here are some tried-and-true tactics to get you to financial freedom that much sooner!

1. Make a Double Mortgage Payment: A double payment once a year can shave over four years off the total life of the mortgage! Better yet, if your mortgage allows for double-up payments, another option is paying an extra $100 into your mortgage – per month. This can save you over $26,000 in interest on a 5.5% fixed-rate, 25-year amortized mortgage.
2. Increase Your Payment Frequency: Changing your mortgage from monthly to bi-weekly accelerated payments can shave over three years off your mortgage. At $2,000 a month, three years of no payments is worth $72,000 (not to mention the interest saved!).
3. Increase Your Payment: Did you know? A one-time 10% increase can shave four years off the mortgage. That’s $96,000 in savings! Imagine if you bumped the payment 10% every year from the get-go. You would be mortgage-free in 13 years—start to finish! Can’t do it? How about 5% every year? You would be mortgage-free in 18 years! You can also consider increasing the payment by the amount of your annual raise.
4. Lump Sum Payments: This is another option to become mortgage-free even faster! Even just one extra payment a year equivalent to one monthly payment will give you similar results as #2 above. Annual work bonuses or other extra-income is a great option for this.
5. Renegotiate When Rates Drop: Revisiting your mortgage is a good idea when rates drop. However, it is always best to get expert advice from a mortgage broker to ensure it makes sense for you. If so, the benefits can be huge! For instance, a 1% reduction on a $300,000 mortgage will save $250 a month—times five years, that’s $15,000.
6. Maintain a High Credit Rating: Even if you have already qualified for the mortgage you want, don’t let your credit rating slip. Pay your bills on time and keep balances low in relation to limits on credit cards, lines of credit, etc. Ideally, using 30% or less of your available credit will garner the highest results (assuming you pay the balances in full every month). Even if you’re filling your card to its credit limit max and paying it off in full each month, it will look like you are maxing out your credit limit and your credit score will drop accordingly.
7. Increase Your Mortgage: Increasing your mortgage for the purpose of debt consolidation can be helpful for paying off credit card debt, line of credits, car loan and so on for a better rate and a set payment plan.
8. Make an RRSP Contribution: By making an RRSP contribution, you can then use your income tax refund to pay down your mortgage!
9. Switch to a Variable Rate: Switching your mortgage to variable-rate while keeping your payments the same as if on fixed can help you pay your mortgage faster. Since variable rates are typically lower, you will be paying more to your principal loan versus the interest.
   • Caution: Variable rates are not for everyone. Always be sure to seek the help of a mortgage broker to find out if variable-rates are the best choice for you.
10. Take Your Mortgage With You: When you move, switch your old mortgage to the new property to avoid a penalty or higher rate on a new mortgage. This is called “porting”, however not all mortgages have this feature so be sure to ask! It is not widely known but could save you a ton of money.
11. Set Up Automatic Savings: Even setting aside $10 per paycheck can help! When your extra savings reaches the amount of one mortgage payment, apply it to the mortgage! This concept goes nicely with #4.
12. Unhook From The Money Drip: Stop paying with your fancy points credit or debit card. These make it way too easy to overspend. Go old school, go off the grid and pay cash. It works and can help you stay on track!
13. Don’t Buy on Layaway: You know, those don’t-pay-for-six-month “deals”, well a lot can change in six-months and you’ll still be on the hook. If you cannot afford it now, don’t buy it. Wait until you are financially able to make the investment.
14. Downsize Your House: Are you living in a 5-bedroom family home but your kids are grown up and moved out? Consider downsizing to a smaller house. It will save you money on your mortgage payments and maintenance fees in the long run!
15. Rent Out the Basement: Not ready to move? Consider converting spare rooms to rental and use the income to pay down debt.
16. Make Your Mortgage Tax-Deductible: If you are self-employed, own rental property or have investments, this is likely possible. Check with your Dominion Lending Centres mortgage broker to see if this option is right for you!
17. Prioritize Your Payments: Define your various debts by category. This can help you see where you spend your money and also help you pay off your debt faster.
18. Start With the Highest-Interest Rate: Pay off loans with the highest interest rates first, as these are the ones eating into your extra income!
19. Leave Tax-Deductible Until Last: Pay the non-tax deductible loans first and fastest and leave tax-deductible debt to the end.
20. Focus on Ugly Debt First: Debt such as credit card balances are the worst on your credit rating. Pay these off first.
21. Pay Off Bad Debt Next: Debt for items that depreciate in value, such as car or boat loans, should be the next on your priority list.
22. Clear Good Debt Last: Loans such as mortgages or investments for assets that should appreciate in value are the least harmful to your net worth and can be paid out last.
23. Buy a New Car – Outright! Finance it if you have to but don’t lease, unless you are self-employed in which case leasing makes more sense.
24. Use Your Secret Stash: If you have $20,000 in a bank account for a rainy-day or vacation and yet owe $20,000 on a line of credit, you need to reconsider. The bank account is paying you next to no interest (which is taxable income) and the line of credit rate is way higher (and not tax deductible). You know what to do. You can keep the line of credit open and on standby for a rainy day. Make it the secret line of credit that you have but never use.
25. Give your Banker More Money: No, really. Keep enough in your chequing account to meet the minimum requirement to waive your service charges. Some banks charge a fee for transactions and nothing, zero, zilch, zip if you keep $2,500 in the account. Let’s see, $10 x 12 is $120 a year to pay off debt. I’d have to earn 5% with the $2,500 in my savings account to come out ahead. No-brainer here. Oh yeah, if you need more than 25 transactions a month, see #12 above.

Let’s face it, your financial future will not get any brighter if you continue to run deficits forever. Unlike a bank or big company, you won’t get a bailout! Stop procrastinating and take charge of your own finances with the above tips!

If you are looking for expert advice about your mortgage and how to pay it down faster, contact a Dominion Lending Centres professional to discuss YOUR situation and options.

BORROWER BEWARE:

It is always important to take things with a grain of salt. This is especially important when it comes to too-good-to-be-true, ultra-low-rate mortgages. These “no frills” mortgages are often loaded with restrictions such as pre-payment limitations, fully-closed terms, stripped-out features or unusual penalties. If you’re not looking at what you’re giving up, you may regret it in the future. These hidden terms alone could prevent you from taking advantage of tips #1, 2, 3, 4, 5, 7, 8, 9, 10, 14, 16 and 22!

For most Canadians, a home looks like a few different things. It is either a single-family dwelling, a townhome, condominium or a high-rise. But Daniel Croft, Vice President of Giant Container Services, is looking to change that!

In the quest to find less expensive housing and alternatives to the conventional home, we have seen many new ideas crop up in the last decade. From container homes to tiny homes and even the centuries-old design of a yurt, Canadians and Canadian manufacturers are starting to look at the home in an entirely different way.

CONTAINER HOMES

Giant Container Services is a Toronto company that’s been converting shipping containers into homes for over 10 years. With roots in the trucking industry, it was in the early 2000’s when Croft’s grandfather started noticing these big containers being used for storage. This was the lightbulb that resulted in a new division being born – turning the containers into homes.

Croft started with 100 containers and has since noted business has been booming! During a conversation with Croft, he noted “huge interest in container homes” elaborating on some of the company’s projects, which included condominiums built out of hundreds of containers!

While he noted that many of his current clients are using the containers as a vacation property home, the demand continues to grow. Currently, Giant Containers offers four models ranging from a 320 square foot 1-bedroom / 1-bathroom build to a 960 square foot 2-bedroom / 2-bathroom build; all for just $85 a square foot! Despite the containers basically being a prefabricated steel structure, Croft says they’re built like a house and include electrical and plumbing; the same as you would find with a traditional build. His company also works to guide owners through the process of assembling the containers.

After getting his feet wet in the small-home industry, Croft sees the prefabrication of living structures, like these containers, as the future of home ownership! Not only are they affordable, but they can also be transported at low costs and last longer than a conventional wood frame home.

When asked about what type of people purchase these homes, Croft noted that his customers range from millennials to couples in their 40’s. According to him, his clients and target demographic “knows they want to be in a container house; they like the look and feel of it and the sustainability aspect”. He admitted that this is something he has been really behind in (us too, Daniel!) but he really feels that this is the future of building.

MICRO HOMES

As Canadians become more focused on affordability and as environmental concerns continue to grow year-over-year, it is easy to see why these small houses could be the start of a new eco-friendly future!

In fact, across the country in British Columbia, a company known as Nomad Micro Homes also experienced a boom in interest for its product. The company offers two styles of micro homes – their NOMAD Cube and NOMAD Micro. The Micro runs $25,500 USD for the studio version ($27,800 USD for the guest suite version) while the Cube will set you back $38,800 USD.

The founder and CEO of Nomad Homes, Ian Kent, describes the product as a “do it yourself” kit home; similar to something you’d buy in Ikea that can be put together very quickly. While they may be simple, he notes people can live in them as a primary residence. It is also important to note that Nomad’s designs aren’t on wheels like some versions of tiny homes.

According to Kent, the company sells roughly 30 homes a year but has the ability to increase production scale to thousands of units if needed. Kent sees the tiny home as one answer to a rental supply crisis gripping B.C.’s Lower Mainland as it is an “extremely low-impact backyard dwelling It is small and private; nobody cares about it and you’re not going to bother anybody with it. Plus, you’re going to provide the most affordable housing in the Lower Mainland!”

Indeed, this could be the option that we need for homeless individuals and others who cannot afford high housing or rental prices. In fact, in Vancouver alone, the 2019 Homeless Count found that more than 2,200 people do not have a home! In order to help resolve this, the Government of British Columbia committed its April 2019 funding towards the development of more temporary modular housing across the province. As of April 2020, there are currently 663 units of modular housing in Vancouver.

Avi Friedman, a professor of architecture at McGill University in Montreal, believes the shrinking size of the home is a reflection of the economy. The reality is, building larger homes costs more. Add this to the fact that many Canadians are no longer having children – according to Stats Canada, the total number of births dropped 3% from 2014 to 2018. For those who do, many of these families are smaller than previous generations, resulting in less space requirements.

Friedman also suggested buyers want bigger homes to start with, but when millennials are entering the current market, they are simply unable to afford the size of dwelling their parents owned. He notes that in the past, many people’s first home was a single-family house, but today most people begin their adult life in an apartment.

While the professor agrees these alternative homes can help alleviate the housing pressures in areas like Toronto and Vancouver, he wouldn’t want to see tiny homes in all communities. Instead, he sees these homes integrated among a range of housing options.

Friedman also called on municipalities to be innovative, allowing for flexible designs to address the housing issues. “What municipalities can do is revisit archaic bylaws that have been introduced in the 1940s and ’50s and see how they can be readjusted to current economic and social reality,” he says.

WHAT ABOUT A YURT?

If the container or micro home isn’t your thing, there’s a centuries-old way of living to put you more in touch with nature. The yurt design is essentially that of a circular tent. Patrick Ladisa is the President of Yurta, a yurt manufacturer in Toronto, who says he’s always been interested in minimalist architecture. Back in 2004, his company built its first yurt, which was designed to be a relief or cost-effective living shelter.

The company makes two sizes of yurts; a 13’ diameter (133’ sq) and a 17’ diameter (226’ sq). Both are available in 6’ and 7’ wall heights and range between $10,500 to $11,500 with your choice of insulation packages from $3,500 to $4,000. They also have additional options such as windows, a solid door and a chimney outlet. What you won’t likely see is much indoor plumbing. Ladisa noted the attraction to the yurt compared to the container or tiny home is a desire to be close to nature and a connection to the outdoors.

As with any good business idea, Yurta has since evolved making a splash in the recreational market. Ladisa now sees people using the structures as a guest space at a cottage, or in place of a cabin in the woods.

financing on an alternative home

When purchasing a prefabricated home, there are a few things to keep in mind with regards to financing.

1. It is only possible to get a mortgage on the property if it has been de-registered and permanently affixed to land that is owned already, or being purchased by the buyer. Otherwise, it’s considered a chattel loan (similar to an auto loan).
2. The age of the prefabricated home will determine the maximum amortization on the loan. You are only able to amortize a property the expected remaining economic life of the home, less five years.
3. A minimum down payment of 20 percent is still required for the purchase of the prefabricated home – just like with a regular mortgage – as well as the property. If the lot is already owned, then financing will depend on how much existing equity is in the land.
4. Location is important!! If you are planning to place your prefabricated home on a remote property or in a remote area, the chances of obtaining financing becomes slimmer.

While this may seem discouraging, it is important to remember that lenders are always changing their requirements and are always adding to their portfolios and updating which home types and properties they provide financing for. To make sure you understand all your options, it is best to talk with a Dominion Lending Centres mortgage broker for expert advice on whether or not alternative home financing is available to you – and what your other options might be!

So you want to make a major home renovation. Congratulations! Now, you’ve got to find the right contractor for the job. While doing a thorough online search or asking family and friends is an important first step, once you find a potential contractor, it’s time to start treating the process like a job interview. Being prepared with the right questions protects you from future headaches, but also ensures that you’re happy with the end result.

Hiring a contractor for your big home reno? Ask these important questions to make sure you’re picking the right contractor.

1. What is your experience in home renovation?

This question can help you determine how long the contractor has been in the business, whether they’ve worked with similar challenges as those in your home and how they ensure that projects are completed on time. With this question, you get full insight into their methodology.

You can also find contractors in your area that might have positive Yelp reviews or other social media to see if others are happy with their work.

2. Do you have a contracting license?

Depending on where you live, there are different requirements for what type of license a contractor has to hold. Check the laws in your region to see what might apply, and ask potential contractors directly whether they hold those licenses.

3. Do you carry the appropriate insurance?

According to the Canadian Homeowner’s Association, hiring people without the proper insurance could put you at legal and financial risk should something happen in your home. Protect yourself (and the workers improving your home) by checking off this box in the beginning, and ensure they have both liability insurance and worker’s compensation.

4. Will we get a written contract?

This should be a given if you’re working with a contractor because if the answer is no, don’t even bother moving forward with the interview. The CHBA says contracts should cover the description of the work, the materials used and the price of the job. You should also take this as an opportunity to figure out your payment schedule, as the Better Business Bureau in the U.S. says that you should never pay the full price of the job upfront, and the specific timeline for completing your project.

Contractors should also always offer a warranty in writing that informs you of what is covered and for how long.

5. Can we get in touch with your past clients?

A contractor should be proud of their past work. Take this as an opportunity to figure out how contractors approach their work, whether they have effectively handled disputes and fact-check what contractors tell you about their working style.

6. Will you be responsible for building permits?

If there is a chance that your building requires permits, you want to make sure that your contractor is prepared in this area. Square One Insurance says you should try to be present for a contractor’s home inspection to ensure that you fully understand their feedback, and anticipate if any changes in your home need to happen.

As a first-time buyer, there are some homebuyer mistakes you should avoid to ensure a smooth and successful experience:

THINKING YOU DON’T NEED A REAL ESTATE AGENT

You might be able to find a house on your own, but there are still many aspects of buying real estate that can confuse a first-time buyer. Rely on your agent to negotiate offers, inspections, financing and other details. The money you would have saved on commission can be quickly gobbled up by a botched offer or overlooked repairs.

GETTING YOUR HEART SET ON A HOME BEFORE YOU DO YOUR HOMEWORK

The house that’s love at first sight may not always be what it seems, so keep an open mind. Plus, if you jump in too fast you may be too quick to go over budget or you might overlook a potential pitfall.

CHOOSING A FIXER-UPPER BECAUSE THE LISTING PRICE IS CHEAPER

That old character home may have loads of potential, but be extra diligent during the inspection period. What will it really cost to get your home to where it needs to be? Negotiating a long due-diligence period will give you time to get estimates from contractors in case you need to back out.

COMMITTING TO MORE THAN YOU CAN AFFORD

Don’t sacrifice retirement savings or an emergency fund for mortgage payments. You need to stay nimble to life’s changes and overextending yourself could put your investments—including your house—on the line.

GOING WITH THE FIRST AGENT WHO FINDS YOU

Don’t get halfway into house hunting before you realize your real estate agent isn’t right for you. The best source: a referral from friends. Ask around and take the time to speak with your potential choices before you commit to a realtor.

DIVING INTO RENOVATIONS AS SOON AS YOU BUY

Renovations may increase the value of your home, but don’t rush. Overextending your credit to get upgrades done fast doesn’t always pay off. Take time to make a solid plan and the best financial decisions. Living in your home for a while before renovating will also help you plan the best functional changes to the layout.

CHOOSING A HOUSE WITHOUT RESEARCHING THE NEIGHBOURHOOD

It may be the house of your dreams, but annoying neighbours or a nearby industrial zone can be a rude awakening. Spend some time in the area before you make an offer and talk to local business owners and residents to determine the pros and cons of living there.

RESEARCHING YOUR BROKER AND AGENT, BUT NOT YOUR LAWYER

New buyers often put all their energy into learning about mortgage rates and offers. But don’t forget that the final word in any deal comes from your lawyer. Like finding a real estate agent, your best referral sources for a lawyer will be friends and business associates.

FIXATING ON THE LOWEST INTEREST RATE

A reasonable interest rate is important, but not at the expense of heavy restrictions and penalties. Make a solid long-term plan to pay off your mortgage and then find one that’s flexible enough to accommodate life changes, both planned and unexpected. Be sure to talk your Dominion Lending Centres mortgage professional to learn more.

OPTING OUT OF MORTGAGE INSURANCE

Your home is your largest investment, so be sure to protect it. Mortgage insurance not only buys you peace of mind, it also allows for more flexible financing options. Plus, it allows you to take advantage of available equity to pay down debts or make financial investments.

If you are ready to search for your first home, don’t hesitate to reach out to a Dominion Lending Centres mortgage professional today for expert advice you can count on.

More and more Canadians are choosing to buy a second property in retirement. Reasons for doing this vary. Some want to reap the rewards of a lifetime of saving and treat themselves to a vacation home. Others, on the other hand, view their second property as an investment, intending to rent it out and use the rent to bolster their income.

Whatever your reasons for wanting to buy a second property, there are various ways you might choose to pay for it – let’s have a look at what those are.

PAYING THE DOWN PAYMENT

Just like your first property, you’ll need a down payment for your second property. This can be as little as 5% but ideally should be higher – try aiming for 20%.

CASHING IN INVESTMENTS

One way that you may choose to make the down payment is by cashing in on investments. When considering this, however, caution should be exercised. Cashing in on investments in a taxable account can trigger taxes and OAS clawback, as well as potentially pushing you into a higher tax bracket. Taking large sums from your investments will also reduce the size of your portfolio, which can have a knock-on affect on your retirement income. Outliving savings is something all retirees should be conscious of, so think carefully before making large withdrawals that may deplete your pension pot too quickly.

TAKING OUT A HELOC

A Home Equity Line of Credit (HELOC) is a revolving line of credit secured against your primary residence which allows you to access up to 65% of your home’s value. Taking out a HELOC to pay for the down payment can be a good option to avoid cashing in on investments, but they’re not without their limitations. It’s recently become more difficult to get approval for a HELOC, and many retired Canadians without a fixed monthly income have seen their applications denied. If you manage to get approved for the loan, be aware that you need to service it each month, which will have an affect on your monthly cashflow.

USING THE CHIP REVERSE MORTGAGE

Another way to afford the down payment on your second property is with the CHIP Reverse Mortgage. The CHIP Reverse Mortgage allows you to access up to 55% of your home’s value in tax-free cash, meaning it won’t trigger taxes or OAS clawback, or push you into a higher tax bracket. Unlike a HELOC, with a reverse mortgage you don’t repay what you owe until you move out of your home or pass away, so there are no monthly repayments eating into your cashflow. What’s more, depending on how much equity you have built up in your home and how much your home is worth, you may be able to pay off a significant amount of your second property – perhaps even paying for it outright!

PAYING OFF THE MORTGAGE

Unless you were able to pay for your second property outright, chances are you’ll have a monthly mortgage to pay.

If your second home is an investment property, you likely intend to rent it out. In this case, the rent you charge should be enough to cover your mortgage payments (and hopefully a little extra for you each month).

On the other hand, if your second property is a vacation home, you’ll need to factor mortgage repayments into your monthly budget. One way to get the best of both worlds is by renting your vacation property out for short-term holiday lets. This will help you cover some, if not all, of the mortgage payments, while also giving you the flexibility to enjoy your vacation home whenever you want. Want to know more about how the CHIP Reverse Mortgage could help you afford a second property? Contact your DLC Mortgage Professional to learn more!

Written By: Agostino Tuzi
Post Sponsored by HomeEquity Bank