Spruce Grove Mortgage Broker: Krista Rumberg
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Money & Conflict Luncheon

Money MOrtgage

Krista is presenting at the Alternate Dispute Resolution Luncheon  Tuesday February 19th in Edmonton.

It should come as no surprise that money woes can be the cause of marital and family stress; unemployment or poor spending habits can exacerbate the situation. One can easily conclude that
this reality extends well beyond just the family unit.

The FOAJ & ADRIA are pleased to present two speakers this month that will offer their experience, insights and resources to better understand the money & conflict dynamic. What skills or resources might be available to you when assisting families though these difficult conversations or decisions?

 

Speakers

As a mortgage broker, Krista Lindstrom has focused her own practice on families facing separation and divorce, and walking her clients through the complexities of restructuring mortgages and finances to retain the marital home, often with the bets interest of their children in mind.Knowing that life isn’t always easy, particularly at the end of a relationship, Krista has dedicated herself to
helping people navigate all possible mortgage options when facing separation and divorce. Krista believes that Knowledge is Power, and will share her personal experiences in dealing with families in conflict. Attendees will gain insights into approaches, tools and resources that would be useful in their

 

Second presenter is Manraj Waraich, from the Credit Counselling Society, a non-profit service helping individuals and families find their best options to deal with their debt and get their finances back on track. Manraj will present Financial First aid for Mediation Professional, assisting us all to learn how financial stress impacts our clients, to recognize the signs of financial stress, and to know what strategies and resources might be available to assist them.

 

EDMONTON
Tuesday, February 19
11:30 AM to 1:00 PM
Buffet Royale West
17202 95 Ave NW
Money & Conflict
$25 for members & $35 non-members

 

Buy Your Ticket

Tips For Saving For A Downpayment

Saving For A Downpayment

Saving for a down payment is one of those things most of us have to/had to do in our lives. You have created your life and/or family and are looking to get into your first home. This tips will help you with saving some money for your down payment.

Determine how much you need to save

The current minimum needed for a down payment of a home less than $500,000 in Canada is 5% of the purchase price. For homes between $500,000 and $999,999 the minimum down payment is 5% on the first $500,000 and 10% for any of the amount over it. Finally if you purchase price is $1,000,000 or more, the minimum down payment is 20%.

You can try out my handy Mortgage Calculator to input some prices to determine what you think would be an affordable mortgage payment for you for a general idea of your price range in homes.

Set a timeline

Once you have a timeline and an amount from there you can do some simple math to determine how much you need to put away weekly/monthly to save. For example, if you are wanting to save $20,000 (5% of $400,000) and are hoping to do it in 3 years you would need to put away $555 a month or $256 bi-weekly.

Automate your savings

Now that you have the amount you want to save per month in mind, set up automatic transfers with you bank in to a savings account. If you have specific dates you receive your pay you can have them set up to take out that day or the next.

Extras add up

Receiving a bonus at work or a little extra money in your birthday card? Put this money into the savings and it will quickly add up. Just as the little things like eating out and cab rides add up to take funds out of your account, saving on these things will encourage growth in your bank account.

Separation & Divorce Mortgages

Separation & Divorce Can Be Tricky for Your Finances

There’s nothing enjoyable about a separation/divorce, regardless of who initiated the action. But life happens, and people move on.

I began specializing my mortgage brokering business on servicing the needs of those going through separation/divorce after personally having to navigate the processes alone. It was a very humbling experience having to ask my parents to co-sign my mortgage in my 30’s. That was my driver to find another way, so nobody else had to go thru what I did.

“I began specializing my mortgage brokering business on servicing the needs of those going through separation/divorce after personally having to navigate the processes alone.”

I help homeowners split their marital home and educate my clients so they can create financial independence and own a home on their own that’s within their means. No one wants to struggle financially following a split, especially when it takes such an emotional toll.

It’s imperative to examine your finances to determine if you can comfortably afford to buy out your spouse. If you’ve decided to remain in your matrimonial home, but the mortgage payments, taxes, monthly bills and upkeep push you to your financial limit, the stress that this will put you under may not be worth staying put – even for the sake of keeping something constant in your children’s lives.

I help solve this real-world problem by providing specialized options for spousal buyouts. Creating workable solutions for divorcing spouses with the ‘Spousal Buyout Program’.

Divorce Mortgage Equity

When refinancing a typical mortgage, you can only access up to 80% of the home’s value. But, through a Spousal Buyout Program, you can ‘purchase’ the home from your spouse and unlock up to 95% of its equity. Matrimonial debt and lump sum equity payments can also be included in the mortgage – up to 95% of the appraised value. This added access to funds often makes the difference between one spouse being able to buy out the other’s half of the home versus having to sell the home and find two new separate places to live. This can prove especially difficult, of course, if children are involved.

Many people find that qualifying for a mortgage under the new Canadian mortgage stress test rules to be quite difficult. I have special tools that allow a borrower to use child tax credit, child support, and spousal support as a source of income. It is equally difficult for the payor of the support to qualify for a mortgage as this extra payment can be quite limiting. As your broker, I have solutions that can help a borrower navigate around these limitations.

My business thrives on referrals from past clients as well as other professionals such as Collaborative divorce lawyers, financial planners and realtors, and the best part is in most cases your broker is likely to be paid by the financial institution that lends you the money.

This means there is likely no brokers fees to you, the client.

As a mortgage specialist who works with divorcing couples, I’ve adopted three key priorities to ensure I serve every client to the best of my ability, including:

  1. Operating with integrity by always ensuring my clients receive the best mortgage product and rate to meet their unique needs – both now and over the long term.
  2. Providing solutions, support and answers while navigating unchartered territory such as separation/divorce, which ultimately leads to financial independence.
  3. Keeping a positive outlook regardless of the situation at hand to help keep clients in a positive frame of mind while they complete their separation/divorce and split the matrimonial home.

As an added benefit of my specialization, I’m also able to get more exceptions from my trusted lender partners to ensure my clients’ needs are met along their road to financial independence following a breakup.

In this difficult time I want to be able to help clients and ease some of the stress that goes along with seperation.

Krista Lindstrom, AMP

Divorce Mortgage Specialist with Axiom Mortgage Solutions.

axiom mortgage solutions krista rumberg icon

Bank of Canada Increases Lending Rate

Prime Lending Rate Increasing

On October 24th, the Bank of Canada made an announcement that will see the prime lending rate increase by .25%. With more increases predicted in 2019, many variable rate mortgage holders are wondering if now might be the time to lock into a fixed mortgage.

So what happens when you switch to a fixed from a variable anyway?You’re going to pay more interest, and it will cost you more to break your mortgage.

First of all, you’re going to pay more interest. Generally speaking, fixed rates are higher than variable rates of the same term. The reason you’d consider locking in mid-term would be to hedge yourself against, potentially, a higher variable rate in the future. But by fixing it mid term, you’ll always end up paying more interest in the short term and in most cases, the long term as well.

The Bank of Canada has 8 scheduled announcements per year and they rarely move more than .25% per announcement. So it could take years for the future variable rate to even match the fixed rate of today.

Secondly, by moving to a fixed rate from a variable rate, it could be considerably more costly to break that fixed-rate mortgage.

Although each bank calculates the penalty to break a mortgage differently (the big banks being the worst), breaking a variable rate will typically cost 3 months interest or 0.5% of the mortgage balance. Meanwhile, breaking a fixed rate mortgage with the Interest Differential Penalty (IRD) could mean paying up to roughly 4% of the mortgage balance.

6/10 Canadians will break their current mortgage at an average of 38 months. If you’re dealing with a 5-year term, an IRD has the potential to cost you a lot of money… certainly worth considering before locking in.

Now, of course, each person’s financial situation is different and it’s impossible to provide one-size-fits-all advice. There may be circumstances that warrant locking in, so if you’d like to discuss your mortgage and what the numbers look like for you, please reach out anytime!

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

Going through the big D?

How to keep the family home during a divorce

For the country music fans out there, the words to Mark Chesnutt’s 1994 hit song still ring in my mind: ”I’m goin’ through the Big D and I don’t mean Dallas. I can’t believe what the judge had to tell us. I got the jeep and she got the palace…” Well, that may have been the 90’s way of doing divorce, but it doesn’t have to be like that.

If you find yourself in this unfortunate situation and you are in the middle of a divorce, chances are you will face one of the most common situations facing separating couples – one of you wishes to keep the house. So, you do like 65% of Canadians and you go to the bank. BIG mistake. The non-specialized personal banker nicely tells you that you need 20% equity in your home to refinance. If you live in Alberta like I do, we have seen little gain in equity since our market crash in 2008. Basically, if you bought your home with less than 20% down in the past nine years, they will likely tell you that you need to sell.

Tears well up in your eyes as you think about what your kids are going through, and how you must now compound the problem by moving them away from their neighbourhood friends and their familiar bedrooms. I have been in your shoes, and became a single mom when my kids were four and five years old. It was awful. Had I known there were other options, I may have chosen to do things differently.

The Spousal Buyout program

Here is a solution to this common problem. I call it the spousal buyout program. This program allows one spouse to “purchase” the matrimonial home from the other spouse and use up to 95% of the equity, unlike the bank’s refinancing program that only allows 80% of the equity. This program is truly a life-saver –  it keeps kids in their home and makes the best of a non-ideal situation.

What I like best about this program is it can be customized to each unique situation. This is perfect because one of the hardest components of divorce is the division of your assets and liabilities.  Joint car loan that needs to paid out? No problem. Joint credit card debt? No problem. Providing you have enough equity, these debts can be consolidated, allowing one spouse to be paid out in a lump sum. This lump sum can be an equity payout, or an equity and spousal support payout. Eligibility for this program is based on approved credit and up to 95% of the equity available in your home.

Are you concerned about qualifying for the spousal buyout program? We can use your spousal support, child support for your children under the age of 12, and any child tax benefits as income, in addition to your employment income to help you qualify.

For the person who is making support payments, this liability is often crippling on a mortgage application. There are options to reposition the spousal support debt to make it easier to qualify to purchase a new home. I’m happy to answer any questions you have about this and to help you find the right option for you.

This trying time requires an experienced professional mortgage broker to evaluate your financial situation. I have over 10 years of experience as a mortgage broker, and have specialized in spousal buyouts for five years. If you need help to guide you through the mortgage process during this change in your life, give me a call at 780-946-6222. In most circumstances, I am paid by the lender and not by you. Let’s face it, you’re hemorrhaging enough money right now (remember, I have been in your shoes).  Visit my website at www.spousalbuyout.ca for more info.