Strange as it seems, the reason we don't get what we want is because we're actually getting exactly what we want! The trouble is, we set our sights very low, convince ourselves that's all we want, and end up getting exactly that. To attract more wealth, we have to WANT that level of wealth. But just "wanting" isn't enough; you also have to believe you are worthy and capable of achieving that level of wealth. That means developing a wealthy self-image. If we appreciate ourselves as one-of-a-kind human beings with unique strengths and abilities, we begin to value who we are. We feel worthy of the goals we set for ourselves, which makes it easier to achieve them. Unfortunately, 90% of people don't believe they are worthy or capable of much success. So 90% go around not getting much out of life. Ever notice how wealthy the top 10% of society is? Not only do they have positive self-images, they recognize how little the other 90% expect out of life. It's pretty easy to succeed when you're surrounded by people who have "I can't" as their mantra! But you don't have to settle for being among the 90% of under-achievers. Start recognizing and focusing on your strengths today. Delegate your weaknesses. Be grateful for the wealth you already have. Start feeling wealthy. Eventually, you'll start behaving like a wealthy person. Soon you'll be attracting even more wealth because you know you deserve it. Remember, your net worth will rarely exceed your self-worth!
Wednesday, 31 October 2012
Beyond Rates: What the Banks won't tell you about choosing the Best Mortgage
Choosing the best mortgage from all the available lenders out there can be complicated. There are so many terms, features, restrictions and potential penalties to keep in mind. But at least mortgage rates are easy to compare—all you have to do is choose the lowest one, right? Think again! Choosing the lowest rate is only straightforward if all the rates are stated the same way and include the same things. Fortunately, lenders are required to use the Annual Percentage Rate (APR) as their posted rate. So on lender websites, ads and window posters, the rate that's quoted should be APR. The Annual Percentage Rate is a compound rate, so it's applied to original principal plus accumulated interest. This gives you a more accurate picture of the actual cost of the loan. To make the APR even more realistic, it not only includes all the interest costs of your loan, it also includes non-interest costs that lenders charge. Depending on the lender, this can include appraisal fees, closing costs, loan fees, loan origination fees, mortgage default insurance, creditor life insurance, legal fees and more. It's that "depending on the lender" part you have to watch. The only way to accurately compare APRs is to look into each lender's fine print and see what's included in the rate it's quoting. Or, you could take the easier, faster, less frustrating route, and simply call me! As your local independent mortgage consultant, I have access to more lenders than you could possibly find on your own, and I fully understand all their products, terms and rates. I'd be happy to do a no-charge analysis of your needs, and then discuss which options work best for you. And I'll make sure you don't get fooled by a really low mortgage rate that could actually cost you more in the long run because of all the restrictions and penalties it includes. Let me help simplify your life—call today!
Tuesday, 30 October 2012
Weekly Rate Minder
October 30, 2012: This edition of the Weekly Rate Minder has the latest, best rates for Canadian mortgages. At Dominion Lending Centres, we work on your behalf to find the mortgage that suits your needs. Best of all — our service is free.* It's the selected lender that pays us and YOU get the best rate. Please note that rates shown are subject to change without notice. The rates shown are posted rates and the actual rate you receive may be different, depending upon your personal financial situation. Check with us for full details and to determine what rate will be available for you.*(O.A.C., E.&O.E.) Explore Mortgage Scenarios with Helpful Calculators at http://www.KupinaMortgage.com
Rates are subject to change without notice. *OAC E&OE Prime Rate is 3.00% Variable rate mortgage from as low as Prime - 0.35%
Current Mortgage Rates
| Term | Bank rates | Our Rates |
| 6 Month | 4.00% | 3.95% |
| 1 YEAR | 3.00% | 2.65% |
| 2 YEARS | 3.14% | 2.69% |
| 3 YEARS | 3.70% | 2.69% |
| 4 YEARS | 4.64% | 3.09% |
| 5 YEARS | 5.24% | 2.99% |
| 7 YEARS | 6.35% | 3.69% |
| 10 YEARS | 6.75% | 3.89% |
Thursday, 11 October 2012
Potentially Flawed data used by Banks and Lenders bump up House Prices
Flaws in a national databank that helps determine the value of houses across Canada have helped fuel inflation in home prices, putting mortgage lenders and borrowers at greater risk, key players in the housing sector have warned. Documents obtained by The Globe and Mail detailing confidential statements from banks, appraisers and mortgage insurers show rising worry over the use of a database operated by the Canada Mortgage and Housing Corporation (CMHC). The documents suggest the data are flawed and help push home prices up. Introduced in 1996 as a way for the CMHC, banks and other lenders to quickly and inexpensively determine how much money can be lent against a residential property, the database known as Emili is relied upon too heavily by lenders, the documents suggest. Emili is an automated system that uses figures such as recent sales of nearby homes to gauge values, without sending an actual appraiser to the address. However, the potential margin of error in calculations may pose significant problems. For home buyers, or homeowners with home-equity lines of credit, an inaccurate valuation by the database could allow them to overpay or borrow much too heavily for the home, industry members argue. For banks, it could mean the collateral they have against the mortgage is not worth as much as believed. "Although it provides very rapid responses, this automated approval system has significant shortcomings," says one industry respondent in the documents, which were obtained by The Globe and Mail through access to information requests. Because the database does not evaluate a specific property, but uses generalities to determine the risk level of a mortgage, "CMHC insured loans are often granted without truly taking into account the property's market value," the respondent says. "This poses a real danger of altering housing market data." CMHC is the largest mortgage insurer in the country. The documents, from May, were part of a process by the federal banking regulator, the Office of the Superintendent of Financial Institutions (OSFI), to determine whether Canada's mortgage lending rules needed to be tightened. Though it is not possible to know who is responsible for each comment, since the names of each industry player are redacted to comply with privacy laws, numerous parties flagged concerns about the accuracy of Emili data in gauging home values. Groups who responded to the call for comments include the country's major banks, real estate associations, representatives of the appraisal industry, mortgage insurers, and mortgage brokers. OSFI advised banks this summer to take a closer look at how they determine housing values, and to make more effort to do more in-person appraisals. However, when those new guidelines were announced, there was no indication of the extent of the concerns raised in private by industry, and the heightened level of concern over the accuracy of Emili data. Known as an automated value model (AVM), Emili is used to estimate whether a mortgage or a refinancing is risky or not. When financial players, including CMHC, use Emili, they submit a proposed value to the database, which then responds by saying whether the value fits within the range for that community or not. However, the database can not tell whether the actual property is worth that much. "It allows people to pay too much for a property," Rick Sieb, president of Intercity Appraisals Ltd. in Vancouver, said in an interview. "If the property is worth $300, and somebody comes through and the realtor has convinced him to pay $330, so he's 10 per cent out, and they submit it through Emili or another AVM, it will just say 'yeah, that's fine for that area," Mr. Sieb said. "So the lender still lends the money, the guy still buys it, and the only person hurt in the whole deal is the person who paid too much." The Canadian housing market has been on a tear for much of the past decade but is now showing signs of petering out. During that time, consumers took on record-high levels of mortgage debt, a situation that has troubled Finance Minister Jim Flaherty, who sought to cool the housing market to prevent it from overheating any more and ultimately crashing. His goal has been to steer it towards a so-called soft landing. The latest market data suggest house sales have been falling since he tightened the rules. During a hot housing market, a wider margin of error on estimated values was less of a concern, since there is smaller likelihood a mortgage or loan refinancing will end up under water. But if the market starts to fall, as some economists expect, the accuracy of appraisals becomes paramount. When a lender is forced to liquidate a home in the event of a default, it could incur a loss. In the case of CMHC, the federal government would be left picking up the tab. Automated systems such as CMHC's Emili emerged because they are a fast and inexpensive way to gauge the value of a property, instead of paying for an appraiser. When CMHC launched Emili, it said the move would move "application approval times from days to seconds." Emili is also used by banks on mortgages where the down payment is over 20 per cent. Asked about the documents, a spokesperson for the CMHC said in an e-mailed statement on Wednesday that the corporation uses appraisals "where appropriate." The spokesperson added that Emili "relies on a number of different factors and models beyond home resale data" to determine risk, but did not elaborate. The documents also suggest blunt estimates on home valuations may have resulted in higher CMHC premiums paid by consumers on insured mortgages. The Globe and Mail | Oct 11, 2012
- - Housing starts fall less than expected in September
- - No large pop for Toronto real-estate market, observers say
- - Housing market weakens, more softening seen
Tuesday, 2 October 2012
Fire Prevention Planning
Canadian families are injured or put at risk every year because they have not taken the time to consider what to do in an emergency. The fall is a great time to re-evaluate your fire prevention plan. There are many quick and easy steps that you can take to prevent fires in your home. There are also measures you can take to prepare yourself in the event of a fire or emergency. Be prepared. Prepare a fire evacuation plan and make sure everyone in your home knows how to get out in case of a fire. Following are some important questions that will help determine if you're prepared:
- Do you have appropriate smoke detectors and fire alarms?
- Are you able to hear the fire alarm from all rooms in your house?
- Are you aware of what you should do if a fire occurs?
- Do you and all of your family members know what to do in an emergency?
- Are you able to evacuate independently?
- Have you made the necessary arrangements if you need assistance to evacuate?
- Have you made a fire safety plan?
- Do you need backup power for an elevator or a ventilator?
- Are you able to communicate easily during an emergency situation?
Weekly Rate Minder
July 31, 2012: This edition of the Weekly Rate Minder has the latest, best rates for Canadian mortgages. At Dominion Lending Centres, we work on your behalf to find the mortgage that suits your needs. Best of all — our service is free.* It's the selected lender that pays us and YOU get the best rate. Please note that rates shown are subject to change without notice. The rates shown are posted rates and the actual rate you receive may be different, depending upon your personal financial situation. Check with us for full details and to determine what rate will be available for you.*(O.A.C., E.&O.E.) Explore Mortgage Scenarios with Helpful Calculators at http://www.KupinaMortgage.com
Rates are subject to change without notice. *OAC E&OE Prime Rate is 3.00% Variable rate mortgage from as low as Prime
Current Mortgage Rates
| Term | Bank rates | Our Rates |
| 6 Month | 4.00% | 3.95% |
| 1 YEAR | 3.10% | 2.49% |
| 2 YEARS | 3.35% | 2.59% |
| 3 YEARS | 3.85% | 2.69% |
| 4 YEARS | 4.64% | 3.09% |
| 5 YEARS | 5.24% | 3.04% |
| 7 YEARS | 6.35% | 3.69% |
| 10 YEARS | 6.75% | 3.99% |
5 Questions Every Borrower Should Ask
As a mortgage borrower – particularly if this is your first time embarking upon homeownership – there's no doubt you have a load of questions related to the mortgage process. Aside from the most common questions, such as those relating to mortgage rate, the maximum mortgage amount you'll be able to receive, as well as how much money you'll need to provide for a down payment, the following five questions and answers will help you dig a little deeper into the mortgage financing process. 1. Can I make lump-sum or other prepayments on my mortgage without being penalized? Most lenders enable lump-sum payments and increased mortgage payments to a maximum amount per year. But, since each lender and product is different, it's important to check stipulations on prepayments prior to signing your mortgage papers. Most "no frills" mortgage products offering the lowest rates often do not allow for prepayments. 2. What mortgage term is best for me? Terms typically range from six months up to 10 years. The first consideration when comparing various mortgage terms is to understand that a longer term generally means a higher corresponding interest rate and a shorter term generally means a lower corresponding interest rate. While this generalization may lead you to believe that a shorter term is always the preferred option, this isn't always the case. Sometimes there are other factors – either in the financial markets or in your own life – you'll also have to take into consideration. If paying your mortgage each month places you close to the financial edge of your comfort zone, you may want to opt for a longer mortgage term, such as five or 10 years, so that you can ensure that you'll be able to afford your mortgage payments should interest rates increase. 3. Is my mortgage portable? Fixed-rate products usually have a portability option. Lenders often use a "blended" system where your current mortgage rate stays the same on the mortgage amount ported over to the new property and the new balance is calculated using the current rate. With variable-rate mortgages, however, porting is usually not available. This means that when breaking your existing mortgage, you will face a penalty. This charge may or may not be reimbursed with your new mortgage. Some lenders allow you to port your mortgage, but your sale and purchase have to happen on the same day, while others offer extended periods. 4. What amortization will work best for me? The lending industry's benchmark amortization period is 25 years, and this is also the standard used by lenders when discussing mortgage offers, as well as the basis for mortgage calculators and payment tables. Shorter timeframes are also available. The main reason to opt for a shorter amortization period is that you'll become mortgage-free sooner. And since you're agreeing to pay off your mortgage in a shorter period of time, the interest you pay over the life of the mortgage is, therefore, greatly reduced. A shorter amortization also affords the luxury of building up equity in your home sooner. While it pays to opt for a shorter amortization period, other considerations must be made before selecting your amortization. Because you're reducing the actual number of mortgage payments you make to pay off your mortgage, your regular payments will be higher. So if your income is irregular because you're paid commission or if you're buying a home for the first time and will be carrying a large mortgage, a shorter amortization period that increases your regular payment amount and ties up your cash flow may not be your best option. 5. How do I ensure my credit score enables me to qualify for the best possible rate? There are several things you can do to ensure your credit remains in good standing. Following are five steps you can follow: 1) Pay down credit cards. This the #1 way to increase your credit score. 2) Limit the use of credit cards. If there's a balance at the end of the month, this affects your score – credit formulas don't take into account the fact that you may have paid the balance off the next month. 3) Check credit limits. Ensure everything's up to date as old bills that have been paid can come back to haunt you. 4) Keep old cards. Older credit is better credit. Use older cards periodically and then pay them off. 5) Don't let mistakes build up. Always dispute any mistakes or situations that may harm your score by making the credit bureau aware of each situation. As always, if you have any questions about the information above or your mortgage in general, I'm here to help! Mark Kupina | Dominion lending Centres
What if Mortgages were more Expensive and less Accessible?
If you're a first-time home buyer, odds are that you don't have a 20-per-cent down payment. Without one, you typically need mortgage default insurance to buy a home. The biggest provider of that insurance is government-owned Canada Mortgage and Housing Corp. (CMHC). Since the credit crisis four years ago, its mortgage role has been hotly debated. On the one hand, CMHC makes mortgages cheaper and more accessible. On the other hand, critics say government-supported housing inflates home prices and puts taxpayers at risk if swarms of borrowers default. So that begs a question. What if politicians sided with those critics? What if Ottawa forced higher down payments and drastically scaled back its mortgage guarantees? How would Canadian home buyers fare? Here's a sampling of what you could expect to see: Tumbling home prices Demand would drop off a small cliff since 35 to 50 per cent of purchasers are first-time buyers, depending on the year. The Canadian Association of Accredited Mortgage Professionals (CAAMP) estimates that home purchases would plunge by 100,000 annually if minimum down payments rose by even five percentage points. Then again, falling home values would lower purchase prices. A 15-per-cent price drop means the average home buyer would pay $52,500 less for a house. Other things equal, that's a $250 monthly payment savings versus today. Economic fallout The economic repercussions are virtually unquantifiable. One-fifth of Canada's economic production can be traced back to housing-related spending. Falling prices and levels of home ownership would slow economic activity. That means fewer jobs (almost one in six new jobs are construction-related), lower wages, more mortgage defaults and a meaningful drop in consumer spending. But over time, the economy would adjust. Switzerland, for example, has roughly 65 per cent renters and it's one of the most prosperous countries in the world. Reduced home buying could also encourage healthier savings rates. Higher rents Our ever-growing population needs to live somewhere, whether in a house they own or a rental. In many cities, rental supply is tight with fewer than three out of 100 rental units available for rent. If young Canadians can't buy, they'll add to rental demand and push up rents until supply catches up, assuming it does. Longer wait times It takes roughly four to five years for most Canadians to save up even a 5-per-cent down payment. But without mortgage insurance you need 20 per cent down for good rates, or 15 per cent down for non-prime rates. Saving that much could take a dozen years or more if you had no help. People would be waiting until their mid– to late-thirties to buy, assuming they didn't spend their savings beforehand. While renting, they'd also forgo any price appreciation, but save on home ownership costs like property taxes, condo fees, maintenance and so on. Lower insurance costs Lower prices and 20-per-cent down payments would save most first-time buyers $5,000 to $10,000 in default insurance premiums, plus interest on those premiums over the life of their mortgage. Retirement risk Canadian's single biggest investment is their home. Devaluation and hampered growth of that asset might put hundreds of thousands of seniors in jeopardy, especially if their other assets didn't return enough to fund their cost of living. Higher mortgage rate Government-backed financing gives investors the confidence to provide mortgage capital at extremely favourable rates. Without it, virtually no one would lend to you with only 5 per cent down. What's more, federally regulated lenders are required by law to insure high-ratio mortgages. Non-bank lenders might some day offer low-down-payment uninsured financing, but the rates wouldn't be pretty. Uninsured 90 per cent financing could easily cost up to 2.5 percentage points above today's rates. Picture a 5.5-per-cent five-year fixed rate, compared with today's 3 per cent. Over 20 years, a 2.5-point rate premium would cost $29,000 more in interest on a $250,000 mortgage, not including lender fees. But again, lower purchase prices could offset this difference. Less lender choice Without insured mortgages, fewer investors would provide small lenders with low-cost funding. It would be much harder to compete with major banks whose cheap deposits and superior credit ratings allow for the best possible funding costs. Less competition means fewer mortgage choices and fewer alternatives to things like high mortgage penalties at the banks. Restricted lending areas Most lenders don't like lending in small or rural markets where it's hard to resell a repossessed home. Insured financing from CMHC encourages lenders to take that risk. Without it, more people would have to buy closer to urban areas, harming rural Canada and driving up urban home values. Some will consider all these factors and feel it's worth the economic side effects to pull back government from housing. They want more affordable home prices and lower risk of an insurer bailout, however remote it may be. Others take a "don't fix what's not broken" stance, arguing that federal housing policies have: com/globe-investor/personal-finance/mortgages/what-if-mortgages-were-more-expensive-and-less-accessible/article4573255/
- spared Canadian housing from catastrophic weakness during the great recession
- required borrowers with low down payments to have good credit, reasonable amortizations and sensible debt ratios
- made borrowers liable if they default and trigger a mortgage insurance claim
- kept defaults near four-year lows (albeit, this is not a foolproof indicator)
- required mandatory default insurance, which ensures the government can easily influence underwriting policies at all lenders, something it couldn't do in a private market.
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