Spruce Grove Mortgage Broker: Krista Rumberg
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Retirement With A Mortgage

There’s a chance you read the title to this article and thought “I’m a long way off from retirement”. That’s okay, chances are you know someone (maybe parents or relatives) who could use this information, feel free to pass it along.

If you find yourself in the position thinking about retirement and what options you have with your mortgage, you’ve come to the right place. As an independent mortgage broker, I can provide you with many more options than a traditional bank. You might be closer to retirement than you think, and a good mortgage can certainly help you along the way.

Although it’s ideal to have your mortgage paid off by the time you retire, that isn’t always possible. Especially in today’s economy. More and more Canadians are carrying mortgage debt into retirement, how well they do it relies on the options they have!

Let me outline some options you have:

Standard Mortgage Financing

Standard mortgages work if you’ve got a steady income, decent credit, and equity in your home. There is no reason you shouldn’t qualify for standard mortgage financing. This usually comes at the lowest interest rate and best terms. Even if you’ve already retired, some lenders use pension and retirement income to support your mortgage application.

Reverse Mortgage Financing

A reverse mortgage allows Canadian homeowners 55 years and older to borrow money from their home with no proof of income, no credit check, and no health questions. A reverse mortgage is a fabulous mortgage solution that has helped thousands of older Canadians to enhance their lifestyle.

Home Equity Line of Credit (HELOC)

A line of credit secured to the equity you have in your home is an excellent tool to allow you to access money when you need it, but not pay interest if you don’t. A lot of Canadians like the idea of rolling all their expenses and income into one account.

To figure out which option is best suited to you, contact me directly. Together we can assess your financial situation, put together a mortgage plan, and then see it through.

Questions on your mortgage, or want to compare your mortgage to what is currently available? Please email me.

Mortgage Broker Spruce GroveMortgage Broker Spruce Grove

Check These 5 Things Before Your Mortgage Renewal

When your mortgage term comes to an end, the next step is to look at your mortgage renewal options. Here are five things you should consider when renewing your mortgage to make sure you pay the least amount of money over your next term, because who doesn’t like saving money?!

Do not simply sign renewal papers with your current lender!

When your renewal papers come in the mail, please understand that your current lender hasn’t offered you the best terms available. Don’t just sign and mail them back, to get the best deal… you need to look at all your options first!

mortgage renewal signing

Interest Rate

Most Canadians think that the lowest interest rate means the best mortgage product. Although sometimes that is true, there are other factors such as fine print. In regards to interest rates, your current bank doesn’t always have the best one. They have the best one that they can offer, but it might not be the best on the market. This is where having a broker in your corner to look at rates and compare with your needs in the next 4 points can help.

Fine Print

A mortgage is more than just an interest rate. You can save yourself a lot of money if you pay attention to the fine print, not only the rate.

Breaking Your Mortgage

This would be one of those fine print details to investigate. If you decide to break your mortgage early, you will inevitably end up paying a penalty. A variable rate will typically cost three months interest to break, whereas breaking a fixed rate mortgage can be significantly more costly as you could incur an interest rate differential penalty.

Fixed VS Variable

Whether you go fixed or variable is a big decision. You must decide whether the rate will be allowed to fluctuate along with the bank’s prime lending rate or whether you want to lock in the rate for the whole term.

Also, consider the term length for each fixed and variable, you have lots of options! 6 months to 10 years!

Mortgage Refinance

When your mortgage is up for renewal, you are in a unique position to refinance your mortgage without incurring a penalty, so make sure you consider this option as well.

So if your mortgage is up for renewal within the next six months, looking at all your options is the best way to make sure you get the best mortgage for you.

 

Questions on your mortgage, or want to compare your mortgage to what is currently available? Please email me.

Spruce Grove Mortgage

Krista Lindstrom

Mortgage Broker

krista@mortgagesimple.ca

780-946-6222

 

Mortgage Rules After The Federal Budget

The Federal Budget announced new mortgage rules that were not what we were hoping for.

The best part of the new rules allows Canadians to withdraw $35K from their RRSP which is an addition of $10K over the previous $25K. This is awesome for the first time home buyers program – but remember the RRSP’s still need to repaid over time or they become taxable income.

The second portion that was supposed to be relief is confusing to consumers and disappointing. CMHC will now allow a purchaser up to 10% funding for new homes and 5% for existing homes with a household income of up to $120K. A home buyer purchasing a $400,000 home with five per cent down and a five per cent CMHC shared equity mortgage (worth $20,000), would see their mortgage reduced from $380,000 to $360,000, lowering their monthly mortgage bill. Buyers may borrow no more than four times their annual household income. This additional $20K will have to be repaid to CMHC but terms have not yet be laid out. This new program is set to commence in the fall of 2019. In my opinion this does little in our local economy and encourages Canadians to take on more debt…which is not something we need.

We were hoping for a adjustment to the stress test or bringing back 30 year amortization…the silver lining is the feds mentioned that the stress test will continue to be reviewed and we may see changes at a later point in time. Lets keep our figures crossed.

Watch the video snippet of the announcements below:

 

 

Questions on your mortgage, or want to compare your mortgage to what is currently available? Please email me.

Mortgage Broker Spruce GroveMortgage Broker Spruce Grove

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