Purchase Plus Improvements

PURCHASE PLUS IMPROVETMENTS

The market is right for buyers as it is still a buyers market. Interest rates are at their all time low and there is an abundance of homes to choose from. When you are out searching for that perfect home you may find one you love because of the neighbourhood but it needs a lot of work..

wwww.wehaveamortgageforthat.com!  Its called Purchase Plus Improvements.

In essence what this mortgage allows you to do is buy that very affordable fixer upper home and finance the renovations needed for upgrades.

You are expected to get 3 quotes for each planned improvement.

At each stage of construction an inspection is completed at which time funds are released.

Lenders are looking for significant material upgrades like renovating a kitchen or bathroom, new flooring or plumbing.

There are 2 mortgage insurers for this program and below is a comparison of their guidelines.

As a potential borrower keep in mind or be prepared in having some savings or have access to a Line of Credit for those unexpected costs such as deposits, extra inspections, renovations that are over and above what was originally planned, higher solicitor fees because of disbursements.

          

STATED INCOME MORTGAGES At Mortgage Intelligence we help our clients in achieving homeownership especially for those self employed. The “Stated Income” mortgages are for those self employed persons who are sole proprietors or corporations who write off a lot of their income for tax purposes so that ultimately when they file their person income taxes it shows very little income.   A Notice of Assessment or (NOA) for short is mailed to you from the Canada Revenue Agency once you have filed your personal income taxes. (the blue forms). This can also be recognized as the forms that determine whether or not you owe income taxes or if you are receiving a refund. Lenders use the amount on line 150 to determine a person’s yearly income.   I have a mortgage for that!   There are three mortgage insurers in Canada. Their guidelines are somewhat similar but with a couple of differences.   1. Genworth and Canada Guaranty (CG) will allow a person who has been self employed for longer than 3 years to use the stated income program whereas CMHC will not allow self employed people to do a stated income if they have been in business for longer than 3 years. In other words after 3 years CMHC wants the person in business to be showing an income.   2. Genworth and CG have a higher min credit score than CMHC. 3. Genworth unlike the other 2 insurers will allow half of the 10% downpayment required on a purchase to be gifted from an immediate family member. Special Considerations: Lenders will require more documentation such as business fianancials (accountant prepared), articles of incorporation (if incorporated), up to 12 months of business bank statements. There are some additional forms to be signed by the applicant but overall I try to do as much as possible to make the application process easy.
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Mortgage Intelligence in the News

Calgary Herald

Thursday, October 28, 2010

More Canadians seek mortgage broker's help

The percentage of Canadians using mortgage brokers to buy their homes has increased significantly this decade.

The Deloitte report, Winning Strategies in the Brokered Mortgage Marketplace, released Wednesday, said that in the 1990s mortgage brokers numbered in the hundreds and were a last resort for borrowers unable to obtain a mortgage directly from a bank or credit union.

"Over the last decade, an increasing number of viable options for borrowers have surfaced," said the report. "In addition to branch-based lenders, borrowers can now consult with the banks' own mobile mortgage specialists as well as independent brokers -- while also conducting their own research online.

"In this changing and information-abundant environment, the mortgage brokerage channel has emerged as a legitimate competitor."

The report said the share of transactions increased from 26 per cent in 2003 to 38 per cent in 2009 as mortgage brokers made inroads, particularly with first-time homebuyers and young Canadians.

"Overall, this channel has evolved from a fragmented 'lender of last resort' network to a legitimate option for prime customers."

Years ago, mortgage brokers were the best-kept secret out there, said Karen Blomquist, a mortgage associate with Mortgage Intelligence in Calgary.

"I think the perception was that we only work with people with really (bad) credit and the perception was also that it cost them money to work with us, because why on earth would we do all this work for nothing? I think there's been a real trend change there. I think people are becoming smarter in terms of what a mortgage broker is and the services we're able to offer consumers, as opposed to just going to the big banks and settling for what it is they're being sold," said Blomquist.

"In my circle, I think a lot more people are calling mortgage brokers now to at least get a quote or at least dip their toe in the water."

Blomquist said young people and first-time homebuyers also use Twitter, Facebook and other social media to find things out and do more research than the older buyer.

"They realize the value in getting a broker who's going to look around and get you the best rate. So perhaps they're more savvy than we think they are," she said. "I would say those people are a big percentage of who uses us because they're on the Internet checking everything out."

Jim Murphy, president and CEO of the Canadian Association of Accredited Mortgage Professionals, said the organization will be releasing its annual report in early November.

"Mortgage broker share overall is about 25 per cent of the market," said Murphy.

"It's higher for first-time buyers. First-time buyers are more likely to use a mortgage broker than those who renew their mortgage.

"(Brokers) have access to different lenders, including banks and credit unions, and they really work on behalf of the customer."