Serving Summerland BC, Penticton BC an the entire South Okanagan
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150 - 498 Ellis St. Direct: 250-809-0285 |
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* Purchase * Refinance * Renewals * Debt Consolidation *
* Business Equipment Leasing *
Mortgages and Leasing in the South Okanagan, including:
Summerland BC | Penticton BC | Naramata BC | Okanagan Falls BC
Oliver BC | Osooyoos BC | Keremeos BC | Princeton BC
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There are two benefits for first time homebuyers: The BC's First Time Home Buyer's Bonus and the Federal Tax Credit.
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| BC First Time New Home Buyers' Bonus |
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| First Time Home Buyer's Tax Credit |
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Mortgages and Leasing in the South Okanagan, including: Summerland BC | Penticton BC | Naramata BC | Okanagan Falls BC |
| It seems news has been made again with BMO's 2.99% 5 year and 3.99% 10 year mortgage specials.
As a mortgage broker, it is hardly news worthy as I currently have a 3.95% and several lenders offering 3.99% on a 10 year term. Last time BMO offered the 2.99% 5 year, there were other lenders offering the same without the limiting restrictions BMO has tied to their offer. As of today, 3.19% and 3.29% 5 year terms are available, and I fully expect that we will see the rate specials in the next few days that will match the 2.99% without the BMO's limiting restrictions, as outlined below: |
| Restrictions: BMO's 2.99% 5 year and 3.99% 10 year mortgage specials. |
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| Maximum Amortization |
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| BMO: | 25 years |
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30 years up to 40 years for conventional (20% down) |
| Prepayment Options |
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| BMO: | 10% extra per year |
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15 - 20% per year |
| Payment Increases |
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| BMO: | 10% once per year |
| Others: |
15 - 20% per year |
| Term Restrictions |
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| BMO: |
Fully closed - mortgage can only be paid out by selling the home. Any refinance must be by BMO. You cannot leave BMO until the end of the term unless you sell your home, even if you come into an unexpected money. |
| Others: | No restrictions - move your mortgage, refinance anywhere you like, and if you come into unexpected money, you are free to pay off the mortgage with only the normal prepayment penalties. |
| Time Restrictions |
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| BMO: | The specials expire in 3 weeks |
| Others: | The current 10 year offerings of 3.95% and 3.99% are not specials and do not expire, however they will change normally with the Bond market. When new 5 year offers come available, they will have an expiry. |
| For more information, here is an informative blog post: www.canadianmortgagetrends.com Have a great day , and feel free to forward this article to anyone who may find it useful! |
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Mortgages and Leasing in the South Okanagan, including: Summerland BC | Penticton BC | Naramata BC | Okanagan Falls BC |
ATTN: Small business owners! "Happy Customers, Happy Bank Account - Pricing to sell in a tough market" Thursday March 17, 7pm, at Hooked on Books, 225 Main St Penticton. 778-476-5621
This talk is being presented by Andrew Gregson, a colleague of mine from Kelowna.If you are a small business owner, come and join Andrew and add some resources to your business.
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Penticton, BC V2A 5H4 Direct: 250-809-0285 email: richardbatke@invis.ca web: www.richardbatke.com map: 2004 Main St., Penticton, BC |
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Serving the South Okanagan, including: Summerland BC | Penticton BC | Naramata BC | Okanagan Falls BC |
| Debt Management by Richard Batke, Mortgage Broker in Penticton and Summerland BC |
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Managing your debt is more important now than ever! At best, consumer debt limits your real estate purchasing power and reduces your cash flow, and at worst can cost you your home and force you into bankruptcy. |
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I have recently seen several clients who wanted to consolidate their debt into their mortgage only to find that there is no equity left in their home. As real estate values decrease, people may find themselves owing more than their home is worth. Others have tried to qualify for a mortgage, having great income, however, the consumer debt and car loan payments halted their dream until they make the necessary changes in their debt management. |
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Times have changed! 1. We can no longer assume that our homes will be 2. New legislation regarding mortgage lending has This means that if you want to purchase a home today, you will have to be able to carry a larger mortgage payment now than you would have for that same home before April 19 when the changes took effect. Minimizing your consumer debt load is |
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We need to manage our debt by: 1. Adjust our thinking and actions from being overly consumptive to more |
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I have access to money coaches, financial advisors and I can also help you beat the debt monster with proven debt management strategies. It is easier than you think, debt management simply requires a desire to change and the discipline to do it. In our present economic times, the ones who will be the best positioned to capitalize on the opportunities they bring will be the ones that have successfully managed their debt and are not saddled up with consumer debt payments, those who have equity in their homes and a solid financial foundation and financial plan. My Wife and I paid our home out in 5 years with some determination and creativity, saving countless $$ in interest payments. Contact Richard Batke to learn how you can eliminate |
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Penticton, BC V2A 5H4 Direct: 250-809-0285 email: richardbatke@invis.ca web: www.richardbatke.com map: 2004 Main St., Penticton, BC |
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Serving the South Okanagan, including: Summerland BC | Penticton BC | Naramata BC | Okanagan Falls BC |
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Mortgage Broker use is more important than ever! by Richard Batke Invis - Wilkins & Associates, Penticton BC
According to the 2010 Mortgage Consumer Survey from Canada Mortgage and Housing (CMHC) mortgage brokers continue to enjoy a 45% market share of all first time home buyers, 39% of all real estate buyers and show significant favour for refinances. Mortgage Broker Use |
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| Eight in ten of respondents who used a mortgage broker for their most recent transaction agree that the mortgage broker took the time to fully understand their financial situation and their needs in a mortgage.
Mortgage consumers included these benefits of using a mortgage broker: - They are able to get the best deal or rate for their - They are convenient - They offer time savings when obtaining a mortgage |
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The necessity of using a Mortgage Broker has
The mortgage lending landscape has changed so much recently, that you need to be intimately acquainted with each mortgage lender's policies. For example: |
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The value of Rental Income Most mortgage lenders do not value the rental income as they have in the past, drastically reducing the purchasing power of rental income. For specific examples, see my previous blog entry: Rental Properties: How the new mortgage guidelines affect your buying power. Today, there are very few lenders who will give you the full benefit from your rental income, and if you are shopping for yourself, the odds are that you not find the rental policy that you need. Acceptable Income Types Each lender has a list of income sources that they allow you to use as income. Some allow the use of Child Tax Benefits, some don't. Some allow Universal Child Care allowance, some don't. The list goes on. Mortgage Qualification Criteria Now most First Time Home Buyers will find themselves getting a 5 year fixed rate term as the savings and extra leverage of Variable rate Mortgages have been reserved for those buying a home less than they are qualified for and those with 20% down payment. for specific examples, see First Time Home Buyer: Your Buying Power Has Changed |
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When you your purchasing power has been has been reduced, it is vitally important that you can make use of ALL your resources when qualifying for the home you want to buy. If you have a lending institution who has the most conservative mortgage lending guidelines, they will decline your application. |
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If you use a Mortgage Broker, you will enjoy not only the best interest rates and mortgage products, |
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I shop your mortgage to many different mortgage lenders including Chartered Banks, Credit Unions, "Mortgage Only" lenders and much more. I have creative mortgage products including: - Home Equity Line of Credit - 50 / 50 Mortgage - combined variable - Re-advancable Mortgage - not a Line - Simple fixed or variable |
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Penticton, BC V2A 5H4 Direct: 250-809-0285 email: richardbatke@invis.ca web: www.thehomefinancecentre.com map: 2004 Main St., Penticton, BC |
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Serving the South Okanagan, including: Summerland BC | Penticton BC | Naramata BC | Okanagan Falls BC |
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Rental Properties: How the new mortgage guidelines affect your buying power, by Richard Batke, Mortgage Broker, Penticton and Summerland BC Purchasing Power and Rental Properties - How have the new mortgage lending guidelines in Canada affected you? The Following comparison is using today's mortgage interest rates for all calculations. |
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Example 1: Non Owner Occupied Rental Property |
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Before April 19 Mortgage Lending Changes: |
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For Someone qualified to carry a mortgage payment of $1200/month for a rental property that has $1200/month income: 1. $237 900 purchase price with 5% 2. $313 000 purchase price with 20% |
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| After April 19 Mortgage Lending Changes: |
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1. 5% down payment no longer available - 20% down payment minimum 2. $127 500 purchase price with 20% down for most lenders. 3. $313 000 purchase price for a select few lenders. |
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Summary: CMHC is no longer participating in the non owner occupied rental market. This means that you must have a minimum of 20% down to invest in real estate. It is also more important that ever for you to be aware of the lending policies of the many different mortgage lenders. They can simply tell you that you are not qualified for your purchase because they are one of the vast majority of lenders that no longer allow you to get the maximum benefit from the income of your rental property. |
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Example 2: Owner Occupied Rental Property |
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Principal residence purchase with a self contained rental suite. This is also true for a duplex, triplex and fourplex. |
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Before April 19 Mortgage Lending Changes: For Someone qualified to carry a mortgage payment of $1800/month: |
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1. $395 400 purchase price with 5% down 2. $531 600 purchase price with 5% down 3. $631 250 purchase price with 20% down |
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After April 19 Mortgage Lending Changes: |
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1. $395 400 purchase price with 5% down 2. $421 000 purchase price with 5% down 3. $631 250 purchase price with 20% down |
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Summary: For owner occupied rental properties, your purchasing power has been significantly reduced if you do not have a minimum 20% down payment. This does not negate the benefit you receive by using a rental suite to pay your mortgage down faster! We are evaluating purchasing power only. In this example, there was over $110 000 reduction in your buying power! |
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Overall Summary: The new mortgage lending guidelines are ensuring that those who have equity are the ones who enjoy the maximum leverage from their resources. You need to become one of them, and I can help you get there. Furthermore, different mortgage lenders evaluate loan obligations differently, some allow child tax benefits and UCC as income, some don't. The days of simple mortgage underwriting are gone, so make sure that you have a well trained and experienced mortgage broker in your corner. Whatever you do, do not limit yourself to 1 or 2 banks. In order to be sure that you are getting the best mortgage, you need to have access to many lenders. I have access to more than 80. |
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Now more than ever it is critically important to use the services of a Mortgage Broker who is not only experienced and intimately acquainted with the individual lender's policies but one who has access to the few lenders who will continue to offer the previous rental income model. This is not an extraordinary change, it is returning to similar guidelines we have experienced in the past, though we can still have a minimum down payment of 5%, rather than the old policy of 20% from years gone by. The real estate market will adjust to these changes and |
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2004 Main St. Penticton, BC V2A 5H4 Direct: 250-809-0285 |
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* Purchase * Refinance * Renew * Debt Consolidation * Serving the South Okanagan, including: Summerland BC | Penticton BC | Naramata BC | Okanagan Falls BC | Oliver BC |
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Buying power - How the new mortgage guidelines affect the First Time Home Buyer by Richard Batke, Mortgage Broker, Penticton and Summerland BC The new mortgage lending guidelines are now in effect in Canada, here is how they affect First Time Home Buyers. The Following comparison is using today's mortgage interest rates for all calculations. |
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Before April 19 Mortgage Lending Changes: Someone qualified to carry a $1 500/month mortgage payment could purchase a home worth: |
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1. $394 200 with a 2 year term, Fixed 2. $365 500 with a 3 year term, Fixed 3. $365 500 with a Variable Rate 4. $329 500 with a 5 Year Fixed Rate
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| After April 19 Mortgage Lending Changes: |
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1. $276 100 for all closed terms less than 5 years, including Variable 2. $329 500 with a 5 Year Fixed Rate Purchase power reduction: $39 000
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Summary: Granted 2 year terms for first time home buyers were not popular for many reasons, the variable rate mortgage was. The reduction in this example from the 3 year term and variable rate mortgage is $36 000 as compared to the 5 year fixed rate mortgage. As you can see, the new mortgage lending guidelines have effectively eliminated the variable rate mortgage and all mortgage terms less than 5 years as viable options for first time home buyers with less than 20% down payment. |
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Said another way, all first time home buyers with less than 20% down payment will likely use the 5 year fixed rate mortgage to finance their home, unless they buy a home that is worth less than the maximum amount they are qualified to buy. This can be an excellent choice for some people, but that is a topic for another blog entry. This is not an extraordinary change, it is returning to similar guidelines we have experienced in the past, though we can still have a minimum down payment of 5%, rather than the old policy of 20% from years gone by. The real estate market will adjust accordingly, and settle down into business as usual. |
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2004 Main St. Penticton, BC V2A 5H4 Direct: 250-809-0285 |
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* Purchase * Refinance * Renewals * Debt Consolidation * Serving the South Okanagan, including: Summerland BC | Penticton BC | Naramata BC | Okanagan Falls BC | Oliver BC |
| April 19 Mortgage Lending Changes: Update by Richard Batke, Mortgage Broker |
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Variable Rate Mortgages & Short Term Fixed Rate Mortgages As of April 19 these changes take effect: All variable rate mortgages and fixed rate mortgages with terms of less than 5 years, CMHC insured (i.e. less than 20% down payment purchase or more than 80% Loan to Value refinance), will all be qualified at the current 5 year POSTED rate. This means, that your money will not go as far for high ratio mortgages. |
| Example: Today, you can qualify for a variable rate of 1.95% by being able to debt service at the current 3 year rate of 3.5%. The new rules would make us use the 5 year posted rate of 5.39%, which will reduce your purchasing power.
Someone who would qualify for a $200 000 mortgage now would qualify for $156 600 under the new rules for mortgages. 5 Year Fixed Rate Mortgages 5 year fixed rate mortgages for purchases will remain unchanged. Today, and under the new changes on April 19, the you would still qualify at the contract rate. Today's 5 year fixed rate is 3.69%. |
| Business for Self April 9 |
| This one is unfortunate for those business owners who are very good at reducing their taxable income.
The Stated Income Program will only be available for those who have been in business LESS than 3 years. If you have been self employed LESS than 2 years, your business must be in the EXACT line of work as your previous employment. Otherwise, the BFS Stated Income available for a window of less than 1 year, between your second and third year of self employment. CMHC feels that after 3 years, business owners should be producing enough taxable income to qualify for their mortgages. The maximum loan to value for the Stated Income Program has also changed: Purchases need 10% down minimum, and Refinances can go as high as 85% loan to value. Be sure to plan ahead if you are self employed! |
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| Rental Properties will require 20% down payment and all refinances will be restricted to a maximum loan to value of 80%, as of April 19. |
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* Purchase * Refinance * Renew * Debt Consolidation * * Business Equipment Leasing * Serving the South Okanagan, including: Summerland BC | Penticton BC | Naramata BC | Okanagan Falls BC Oliver BC | Osooyoos BC | Keremeos BC | Princeton BC |
| Mortgage Lending Changes Take effect April 19: Richard Batke - Invis Mortgage Broker |
On Tuesday February 17, Jim Flaherty announced some new changes to the qualification criteria for mortgages.
The changes seem to be in line with Canada's conservative approach to the economy, which proved to be very helpful in during the last year, but they do present some tightening on mortgage lending in Canada.
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Variable Rate Mortgages: Borrowers must qualify at the current 5 year fixed rate, instead of a 3 year fixed rate, which is lower. This will end the ability to qualify for a larger mortgage by choosing a variable rate mortgage. |
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Rental Properties: For non owner occupied properties, the minimum down payment will be 20%, rather than 5%. Since about 40% of condo purchases are for investment purposes, one would think that this will have a local impact on the price of condos in Penticton, which is good news for buyers. |
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| However, you will only need 5% down if you are purchasing owner occupied rental properties, such as a duplex. Buying a duplex, triplex or quad-plex can be a great way to become mortgage free faster and increase your purchasing power.
Houses with basement suites are also a great option. |
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Refinances: Taking the equity out of your home will be limited to a maximum of 90% Loan to Value, from the current 95%LTV. Although this will impact some borrowers, it is not that great of a change, and it does protect you if the value of your home decreases. |
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If you are wanting to access your equity, one of the most versatile ways to do it is through one of the Home Equity Line of Credit products that I have available with a revolving portion at Prime +0.5%, with a free legal and appraisal package. This option allows you to pay your equity take out faster and allows you to re-advance at will. Please feel free to contact me with any questions, and remember that if you will be affected by any of these changes, now is the time to act as the changes will be in effect on April 19, and some lenders may change their guidelines before that time. |
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More Information: |
National Post Article National Post Summary |
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Richard Batke - Mortgage Broker 2004 Main St.Penticton, BC V2A 5H4 Direct: 250-809-0285 email: richardbatke@invis.ca web: www.thehomefinancecentre.com map: 2004 Main St., Penticton, BC |
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Serving the South Okanagan, including: Summerland BC | Penticton BC | Naramata BC | Okanagan Falls BC |
I have lived in the Okanagan for more than 35 years, and enjoy the lifestyle it offers with my wife and three kids.
As a Mortgage Broker, I help my clients through all of the stages of their mortgage from pre-purchase coaching and first time home buyers to making your mortgage work for you through leveraging your equity and making your mortgage interest tax deductible.
My clients have access to my network of financial advisers and real estate professionals, as I endeavor to provide options that are truly in their best interest.
Feel free to contact me anytime.
I truly work on your behalf - in your best interests only - and in the vast majority of cases, my services are absolutely free.
