VERICO Designer Mortgages Inc. | Mortgage Broker | Hamilton | Burlington | Oakville | Toronto | Stoney Creek | Ancaster | Milton | Niagara | Mississauga | London | Kitchener | Waterloo | Guelph | Cambridge

Taking Care of Your Home

gburgio — Tue, 18 May 2010 12:12:42 +0000

Proper maintenance protects the value of your home, keeps it in great condition and means less work and fewer costly repairs in the long term.

- On the pre-possession inspection tour, the builder will explain how to operate and maintain heating, cooling and electrical water systems. You will want to know basic procedures – how to turn the systems on and off and change the settings if required, when to schedule maintenance and who to contact.

- Before establishing a regular housekeeping routine, take a few minutes to read through the product literature provided by your builder. Follow the directions from the manufacturers to preserve the beauty of your home.

- Place furniture away from heating and cooling vents. Keep non-carpeted floors in great shape by using easy-to-apply protectors on legs of chairs, tables and sofas.

- Clean the eaves troughs each fall to prevent build-up of leaves and again in the spring to ensure proper waterflow. Rinsing the siding with water or washing gently with soap once a year will keep it looking great and in tiptop shape.

Ask your builder for more great tips on preserving the beauty and quality of your brand new home.

Canadian Home Resales Drop 2.6% in April From March

gburgio — Mon, 17 May 2010 17:52:37 +0000

May 17 (Bloomberg) — Canadian existing home sales fell 2.6 percent in April from March on a seasonally adjusted basis, as the country’s housing market cools from record sales at the end of last year, a realtor group said.

The number of homes sold dropped to 42,078 in April, from 43,199 units the month before, the Canadian Real Estate Association said in a statement from Ottawa today. Sales between January and April were 63 percent higher than during the same period a year ago and the average price for a home rose 12 percent to C$344,968 ($333,000) from April 2009, the group said.

“Next month will mark the passage of one year since the national average price rebounded from the recessionary trough to return to the pre-recession peak, so the rise in the national average price is expected to be more subdued next month,” CREA Chief Economist Gregory Klump said in the statement.

The housing market will slow “through the remainder of 2010 and well into 2011” as mortgage rates increase, the Bank of Canada predicted in April. The average rate for a five-year mortgage was 6.25 percent in the last week of April, compared with 5.85 percent a month earlier.

Sellers listed 99,901 new homes in April, bringing the total of homes on the market to 236,397, down 1.9 percent from a year earlier, CREA also said.

Golden Rules of Renovation

gburgio — Thu, 13 May 2010 14:50:09 +0000

The Canadian Renovator’s Council of the Canadian Home Builders’ Association offers a number of golden rules to help renovating homeowners achieve their goals.

§ Know what you want. Take the time you need to explore the possibilities for your home and develop a firm plan. Begins with the fundamentals-what do you need and how you want your “new” home to look, feel and work for you and your family.

§ Set a realistic budget. Decide as early as possible how much money you want to spend-this allows you and your renovator to focus on the work that is doable within that budget. Experienced renovators can provide sound cost advice.

§ Plan for the long term. Thinking ahead avoids short-term renovations that may need to be redone in the future. Discuss your short- and long-term goals openly with your renovator. Professional renovators can conduct a thorough inspection of your home and offer suggestions for the most effective sequencing of work over a period of time.

§ Don’t jeopardize the quality of your renovation by compromising on the quality of products or materials. If it’s worth doing, it’s worth doing well, and that means using products that offer the right combination of performance, durability and aesthetics.

§ Don’t choose a renovator on price alone. While it is always tempting to go for the lowest price, you need to consider the implications of doing so. Does the renovator understand what’s involved in your project and have the necessary experience? Will the renovator offer a warranty on the work? Will the renovator still be in business if you need to call back?

§ Protect yourself. Dealing with a professional renovator is your greatest protection against an incompetent or unfinished job. A written contract spells out the arrangements between you and your renovator and describes your renovation in detail. Professional renovators also carry Worker’s Compensation, liability insurance and any licenses required by your province.

§ And don’t buy from a door to door salesperson without carefully checking out the company. Before you enter into any kind of agreement, talk with friends and family. Contact your local Home Builders’ Association to see if the company is a member. Also check with the Better Business Bureau to see if anyone has lodged a complaint against the company.

If life is a journey, we have your trail

gburgio — Wed, 12 May 2010 18:16:36 +0000

Did you know Ontario boasts over 88,000 km in trails? Whether you’re in the Hamilton-Burlington area or located in our outlying areas*, there’s a trail for everyone. You’ll find something for every enthusiast: gentle walking, jogging, cycling, rollerblading, hiking, rock faces for climbing and water routes to fish, canoe and kayak. Many of the trails along rivers will take you through picturesque and charming towns. Whatever calls you to the trail, it’s good for the soul.

Chippawa Trail
When completed, this 15-kilometre abandoned rail corridor will link Hamilton with Caledonia and will become part of the Niagara branch of the Trans Canada Trail. It will also be connected to the Caledonia-to-Dunnville rail trail. Approximately 12 kilometres have been completed and work is proceeding as funding permits.

Cootes Drive Trail
The Cootes Drive Trail is a multi-use asphalt trail extending between Sanders Blvd.(Hamilton) and Dundas/Thorpe Street (Dundas). The trail is 2.5 kilometres long and can be accessed from Sanders Blvd. (where there is a signed level crossing of Cootes Drive to McMaster University), just south of the McMaster University bridge across Cootes Drive, Olympic Drive, King/East Street and Dundas/Thorpe.

Dundas Valley Trail
A 40-km multi-use trail network extends through this 1,200-hectare natural area that comes complete with Carolinian forests, fields, cold-water streams, stunning geological structures, and an array of rare plants, birds and wildlife.

Dofasco 2000 Trail
The second Millennium project of the Hamilton Conservation Authority, this 11.5-kilometre trail will link the 1812 Battlefield House Museum, Devil’s Punch Bowl Conservation Area, Vinemount South Swamp and Bruce Trail. The Dofasco 2000 Trail will eventually continue on road to link with the Waterfront Trail at the Fifty Point Conservation Area and Marina on Lake Ontario.

Desjardins Recreational Trail
The Desjardins Recreational Trail is a 1 kilometre long trail extending from Kay Drage Park access road, along the Chedoke Creek to Cootes Paradise, across the creek then on to the Desjardins Canal.

Woodlot Nature Trail – Rock Point
This trail travels through a variety of different environments within the park, along the top of a lakeside bluff, through old fields and into a Carolinian Woodlot. Stairs lead down the side of the bluff to the beach or limestone shelf with many fossils. Viewing platforms overlook Lake Erie and nearby Mohawk Island and lighthouse.

Rising Mortgage Rates, Rising Trouble

gburgio — Tue, 11 May 2010 19:06:28 +0000

Almost half a million more mortgage holders would be in trouble if their rates hit 5.25 per cent, a national survey showed Monday.

Canadian mortgage rates are already climbing ahead of an expected interest-rate hike next month. In light of a rising rate environment, a biannual report by the Canadian Association of Accredited Mortgage Professionals simulated the impact of mortgage-rate increases up to 5.25 per cent. The current average mortgage rate is 4.02 per cent among households that locked in fixed rates during the past year.

It found that about 375,000 mortgage holders “are already challenged” by their current payments, and another 475,000 might be if their rate rises to 5.25 per cent.

Many borrowers should be fine because they have the flexibility to adjust payments if need be, said the group’s chief economist, Will Dunning.

The tendency has been to higher rates, though several banks — including Royal Bank of Canada on Monday– have trimmed some mortgage rates in recent days. RBC’s five-year closed rate is now 6.10 per cent — still higher than several months ago.

Monday’s report was compiled from an online survey of 3,000 Canadians, almost 1,800 of whom were home owners with mortgages. The survey was conducted by public-opinion firm Maritz for CAAMP, during April.

Among mortgages created during the past year, two-thirds are in a fixed rate, 29 per cent are variable or adjustable, and 6 per cent are combination mortgages.

Caught in between buying and selling a home?

gburgio — Wed, 28 Apr 2010 18:13:44 +0000

Trying to sell a home and buy one at the same time can be a challenging task. Many home buyers find themselves caught in a difficult position as they often cannot place an offer on a desired home and simultaneously sell their current one.

Below are some tips from Coldwell Banker (insert Company DBA Name) on how to close the gap between buying and selling a home:

Consider bridge loans. A bridge loan means borrowing from the current home’s equity until the proceeds from its sale are obtained. Some bridge loans require that only the interest be repaid; others mandate a single payment of interest and principal when the loan needs to be paid back. If protracted, bridge loans can be expensive, so it is best to use them for overlaps of a short period of time between closings.

Buy on contingency. Have a prior-sale contingency included in the purchase contract of the new home. It provides the opportunity to withdraw from an offer if the current home does not sell by a specific and agreed upon date.

Evaluate whether to buy or sell first. You could still find yourself caught in between even with a prior-sale contingency clause. Home owners must consider which is better to do first. In a seller’s market, locating the new home and starting the buying process may be the best approach. It is important to note most people need to sell their current home to qualify for a loan to purchase the next one, which is often more expensive. In a buyer’s market, you should be aware of the time frame and the possibility of not being able to sell your current home quickly.

Review home equity options. For those who need to borrow for a longer period than just a few months, it is best to use a home equity loan or a fixed-rate line of credit, particularly if sizable equity has been built up.

Bond yields rise as fixed mortgage rates move up

gburgio — Tue, 06 Apr 2010 16:30:05 +0000

Canada’s five-year bond yields reached their highest level in almost a year, in part due to improved employment numbers in the U.S., BusinessWeek reported.

“Banks are hedging seasonal mortgage flows, which is weighing on the five-year sector,” Mohammed Ahmed, a rates strategist at CIBC told BusinessWeek. “Banks are receiving a fixed-rate asset and to hedge that, they typically pay the fixed rate in swaps, or sell cash bonds.”

Canada’s benchmark five-year bond yielded 3.04 per cent yesterday, the magazine reported, up 15 basis points from April 1 and the first time the yield has broker the three per cent mark since October 2008. The Bank of Canada will auction $3 billion worth of 1.5 per cent bonds tomorrow.

Most lenders raised five-year, fixed mortgage rates last week in anticipation of higher inflation. These rates will serve as the qualifier for borrowers when the new mortgage rules come into place on April 19.

http://www.mortgagebrokernews.ca/news/bond-yields-rise-as-fixed-mortgage-rates-move-up/43642

First-time buyers make the jump

gburgio — Thu, 01 Apr 2010 04:10:59 +0000

By Derek Sankey, Canwest News ServiceMarch 31, 2010

Nicole Dyck rented with friends and dreamed of buying her own home until the day it suddenly seemed right to make her move.

“Living with two boys motivates you to buy your own place and not have to clean up after anyone else,” says Ms. Dyck, a 27-year-old call centre worker with Fortis Alberta. “I just wanted to have my own place and my own space.”

Last May, she bought a duplex in a condo complex in Airdrie, a bedroom community of Calgary, just as rates were at 30-year lows and affordability was returning to real estate markets across Canada.

“It was a big deal,” Ms. Dyck says. “I was just excited to have my own place and have enough income coming in to be able to do that.”

Like many first-time home-buyers, she admits she didn’t know much about mortgage rules at first and learned the ropes from her parents.

She was also typical in being determined to get into home ownership whatever the rules or market conditions. “Everyone always just said it’s never a bad time to buy a home.”

Many first-time buyers are also looking to pay off their mortgages faster.

A Harris/Decima survey found 74% of Canadians looking to purchase their first home are considering an amortization of 25 years or less.

“We’ve always believed that clients should set their payments higher anyways,” says Laura Parsons, Calgary area manager of business development for the Bank of Montreal.

There are several ways first-time buyers can help make the process more affordable, such as the First-time Home Buyer’s Plan. It allows buyers to use as much as $25,000 from their RRSP toward a down payment on a qualifying home, which is repaid over time.

“The First-time Home Buyer’s program is probably one of the most under-utilized programs,” Ms. Parsons says.

There is also the First-time Home Buyers’ tax credit worth up to $750 in 2009 and subsequent years.

If a couple is getting married, they can funnel gifts of money through their RRSP to use toward the purchase of a home.

Most lenders adopted stricter lending criteria prior to the introduction of new rules by the federal government on high ratio mortgages — those with less than 20% down are subject to stricter conditions and insurance through Canada Mortgage and Housing Corp. (CMHC).

It’s now generally standard for all mortgage qualifications to be based on a five-year, fixed-rate mortgage, Ms. Parsons says.

“It’s not that rates are going to skyrocket, but a mortgage is a longtime event,” she says. “We don’t want to see them in a predicament if interest rates go up.”

Read more: http://www.montrealgazette.com/business/fp/First+time+buyers+make+jump/2746133/story.html#ixzz0jonJ0AVY

HST Update

gburgio — Wed, 31 Mar 2010 15:59:58 +0000

Great info on HST from the Realtors Association of Hamilton-Burlington.

HST Update

We have received more detailed information from CREA about how commissions should be taxed when the listing and closing dates of a real estate transaction straddle July 1, the start-up of HST in Ontario.

In the scenario we used in a previous article, a listing is taken on May 1 and a sale is made, with the closing date of July 31. The commission is due and payable on July 31. In their initial ruling, the Canada Revenue Agency (CRA) and the Department of Finance had decided the determining factor would be the length of time from the beginning of the listing to the closing date, when the commission would be due. In our scenario, then, two-thirds of the commission would be subject to GST (for the time period of May 1 – June 30) and one-third subject to HST (for July 1 – July 31).

The rationale behind this decision was that REALTORS^® typically do not track the time they spend on a particular client’s account, and would therefore be unable to accurately determine whether their services were substantially (90 percent or more) completed before July 1. With that in mind, the CRA agreed that a reasonable simplified basis for calculating the GST and HST amounts when a REALTORs^® services straddle the start-up date is to prorate the fee based on the number of calendar days covered by the services agreement before and after the July 1 start-up date.

It seemed simple, but not entirely fair, considering that just because a deal closes on July 31 doesn’t mean that the REALTOR^® offers services for that entire period of time.

We’ll go back to the example where a listing is taken May 1, and add in that an offer is accepted on June 15, with the closing to take place July 31. The commission is still due and payable on July 31. According to the Canada Revenue Agency, if a REALTOR^® feels that all of his or her services are at an end with that accepted Agreement of Purchase and Sale, they could use that date as the date of completion of their services. However, the REALTOR^® would have to be prepared to prove to a CRA auditor through documentation that his or her services were all or substantially all completed at that date.

To sum up, HST will apply to REALTORS^® services to the extent that the services are performed on or after July 1, 2010. If 90 percent or more of the services are performed before July 1, the HST will not apply. If we go back to our scenario, more than 90% of the REALTORS^® services were supplied before July 1, so the REALTOR^® could charge only GST on his or her services, and no part of the commission would be subject to HST. The onus is on the REALTOR^®, however, to be able to prove to any auditor that no services – or no more than 10% of their services – took place after the accepted Agreement of Purchase and Sale and July 1, 2010.

REALTORS^® will have to use extra caution in instances where an offer is accepted after July 1. Care will have to be taken to determine what percentages of their services were offered before July 1 and what percentage after. The same rule – that HST will not apply if 90 percent of services were completed before July 1 – will be in effect, but REALTORS^® will have to determine what that percentage is and bill GST and HST appropriately. They will also have to be prepared to document their conclusions in the event of an audit by the Canada Revenue Agency.

CIBC wins dismissal of subprime suit

gburgio — Fri, 19 Mar 2010 14:05:15 +0000

TARA PERKINS

From Thursday’s Globe and Mail Published on Thursday, Mar. 18, 2010 12:00AM EDT Last updated on Thursday, Mar. 18, 2010 3:26AM EDT

FINANCIAL SERVICES REPORTER

Canadian Imperial Bank of Commerce may have lost billions of dollars from its exposure to U.S. subprime mortgage securities, but that does not mean its actions were fraudulent, an American judge has found.

A suit filed against CIBC, one of a flurry of lawsuits launched by shareholders against financial institutions in the wake of the financial crisis, illustrates how the courts are evaluating the actions that Wall Street and Bay Street took as the turmoil developed.

“CIBC, like so many other institutions, could not have been expected to anticipate the crisis with the accuracy [that the] plaintiff enjoys in hindsight,” Judge William Pauley wrote in his decision to dismiss the suit, which was filed in the U.S. District Court for southern New York.

The suit was launched by the Plumbers and Steamfitters Local 773 Pension Fund, which was seeking to have it certified as a class-action on behalf of people who bought CIBC shares during the credit crunch. In addition to the bank, the suit named a number of executives, including CIBC’s CEO Gerald McCaughey.

Even assuming that the executives knew a subprime credit crisis was brewing as early as May, 2007, “knowledge of a general economic trend does not equate to harbouring a mental state to deceive, manipulate, or defraud,” the judge wrote.

Moreover, he said that “it is nonsensical to impute dishonest motives to the individual defendants when each of them suffered significant losses in their stock holdings and executive compensation.”

Exposure to U.S. subprime mortgages, and other troubled assets, caused CIBC to post more than $10-billion in writedowns after the crisis began in 2007 and weighed on its stock price.

“CIBC is pleased with the decision to dismiss this lawsuit and the court’s recognition that the allegations had no legal merit,” a spokesman for the bank said yesterday.

The judge also noted that many financial institutions imploded as a result of the subprime mortgage crisis. “Looking back, a full turn of the wheel would have been appropriate,” he wrote. “That CIBC chose an incremental measured response, while erroneous in hindsight, is as plausible an explanation for the losses as an inference of fraud.”