Is It a Smart Decision to Refinance Your Mortgage?

Refinancing your mortgage is not an easy decision to make no matter how many people around you have done the same and things turned out fine. The decision is a personal one and best made when you’re fully informed of the things you need to know when refinancing your mortgage.

What is Mortgage Refinancing?

Mortgage refinancing is when a homeowner gets a new loan on a home complete with new terms. It is usually done to get better terms or to change the length of the loan although some homeowners opt for it to free up some cash by accessing some of the home equity. Some homeowners refinance their mortgage to a shorter-term loan to build home equity faster or to save up money that could have gone to paying for interest. Others refinance their mortgage to a longer-term loan with lower monthly payments so they can allocate some of their monthly budget for other expenses.

When Is it Smart to Refinance Your Mortgage?

Refinancing your mortgage is a huge decision that can have a huge impact on your finances over the long-term. You need to consider what you can afford to pay per month as well as applicable interest rates to make sure that you’ll come to a decision that will serve your best interest. It will be best to talk to a mortgage professional to be fully informed of the pros and cons of mortgage refinancing as well as other financial solutions that can work for your needs.

One of the main factors to consider is whether the cost of mortgage of refinancing will be worth it for you. There are upfront fees that will have to be paid and you need to be sure that you can recoup the cost of the fees. You’ll also have to consider timing. Interest rates in Canada are bound to increase soon so while you won’t want to make a hasty decision, it is better to make up your mind as soon as possible as well. If you have a better credit score now than when you first got your mortgage, you’ll be able to get a better interest rate too.

When Is It Not Smart to Refinance Your Mortgage?

Having low equity is not a good time to have a mortgage refinance. The same goes for when you’re in a bad financial situation or when your credit score has gotten worse. If you’re planning to move soon or will have a major change in your career, it will be better to wait for better timing. Lastly, it will be best to ask a mortgage professional for computations to have an idea whether potential benefits will outweigh the cost and effort of refinancing your mortgage. A good mortgage professional will also be able to negotiate better terms for you should you decide to refinance your mortgage.

Looking for mortgage refinancing help? Contact us today so we can answer your mortgage refinancing questions as soon as possible!

8 Affordable Home Improvement Hacks to Boost the Value of Your Home

Are you trying to find home improvement hacks that will help you sell your home, add value to your home, or perhaps just make your home a lot more enjoyable? We’ve got what you’re looking for below!

Front Door Facelift

A beautiful piece of hardware on your front door will elevate how it looks and add extra class to your home. Consider using this idea together with a front door paint job or if you’re not able to change your hardware, try painting your existing one with a faux brass finish. Instant facelift!

Amp Up Your Curb Appeal

You don’t have to have a green thumb to have a pretty lawn. You can simply have a professional install sod and perhaps plant a few low maintenance evergreen plants for you. Aside from keeping your walkways clean, a touch of well-maintained green is all you need for reasonable curb appeal.

Go for a Kitchen Update

A kitchen update doesn’t have to mean an expensive renovation. You can spend just a few hundred dollars for changing some light fixtures, painting the cabinets, and changing the hardware. If you’re willing to spend a few thousand dollars, you can get your cabinets and some countertops refinished too.

Add an Extra Bedroom

If you have an extra room for an office space or a den, you can easily convert that into a bedroom by installing or building a closet. An extra bedroom can significantly increase your home’ value and make it easier to sell.

Give Appliances a New Life

Do you know that you can order new face panels or doors for some appliances to have them all match? Matching appliances instantly upgrades a kitchen.

Invest in More Storage

Adding storage space and building extra closet are great ideas especially for older homes. With the right design, you can even make everything look like they were custom built with the home, increasing your property’s value.

Change Up the Lighting Fixtures

Switching to modern designs for lighting fixtures or adding a timeless chandelier can do wonders to any room of your home. Not to mention make your home a lot more appealing to buyers when it’s time to sell too.

Bathroom Update Is Always A Good Idea

Bathrooms bear the brunt of a home’s wear and tear so it follows that it will benefit the most for updates as well. New fixtures, new mats, and even a new toilet seat can go a long way without costing too much. Regrouting tiles may be a great idea too if budget permits.

Aside from the above home improvement hacks, cleaning your carpet or refinishing your old wooden floors will likewise give you plenty of returns for minimal investment. The secret is really just choosing the home improvement projects that your home truly needs and prioritizing the ones that will give you the most returns for your investment.

Want to consult with mortgage experts about the best ways to boost and use your home equity in the future? Contact us and we’ll be happy to talk to you about using your home equity for a loan. Our services include home equity loans, second mortgages, mortgage refinancing, and private mortgages.


How Difficult is it to Get a Home Equity Loan?

Getting a home equity loan is considered to be quite a feat for a lot of people because of perpetuated common myths about home equity loans. Don’t forget that other factors such as being self-employed or having a less than stellar credit history can be a deal breaker with some lenders. So, how true is it that getting a home equity loan is difficult?

Not Difficult Once You Understand How it Works

People are interested to get a home equity loan because it is a way to tap home equity and access some cash. Although it is commonly believed to be the same as a HELOC owing to HELOC standing for home equity line of credit; however, the main thing that they both are is that they are ways to turn home equity into spendable cash.

A home equity loan allows homeowners to borrow a large sum of money against their home equity – allowing them to use it for home improvements, paying for college, consolidating debt, or buying a second property.

Because a substantial amount of money involved, there is no guarantee of pre-approval for a home equity loan. Lenders have a process and set criteria regarding who they loan money to so foreclosures are very rare, especially in Ontario.

Getting a Home Equity Loan the Easy Way

Big lenders (such as the biggest banks in Canada) have strict lending rules. This is the reason why it is easier to get a home equity loan from private lenders with the help of mortgage brokers. You’ll also have to understand that you need to have a certain percentage of equity built up in your home certified by your financial records and an appraiser.

Know that despite being less strict, private lenders have to protect their own interests too which means that your ability to pay and your stability are big factors to consider. This can be demonstrated by having a good loan-to-value ratio as well as having a debt-to-income ratio of around 43% to 49%. A credit score of around 300-900 also shows that you have the ability to pay bills on time with those having a minimum of 650-680 getting a better chance of being approved.

Generally speaking, as long as you haven’t taken too much debt, have a passable credit history, have a verifiable source of income, and considering that your home’s value have not dropped, getting a home equity loan isn’t really the challenge it was made out  to be. The answer is going for private lenders instead of banks.

Private Lender for Home Equity Loan?

Private lenders take a more ‘human’ approach before saying no to someone  who wants to take a loan. They’ll look into why your credit score isn’t up to par and will understand that small business owners tend to not have certain requirements (such as a payslip). A less than stellar credit score is not a hindrance as long as you are cooperative with the other requirements and provided that you’ve contacted the  right lender.

Ready to apply for a home equity loan? Contact us and let us help you meet your financial needs. We can help you get in touch with our trusted lenders!


Why Canadian Seniors Should Be Tapping Into Their Home Equity

Most seniors who own homes have stopped working and are either relying on passive income through investments or their savings. A lot are cash poor and feel that they can’t enjoy retirement because of financial issues. Luckily for them, they can use the accumulated value of their property to their advantage!

What is Home Equity and What Does It Mean for You?

Home equity is the value of the property that is paid for and owned by the homeowner. This value often grows bigger as real estate prices increase in the area and can be used to help the homeowner through financial difficulties.

Home equity can also be defined as the difference between the home’s market value and the percentage or part of the value that the homeowner still owes. Say your home’s market value is $400,000 and you still owe $35,000, then your home equity is $365,000!

A substantial home equity is a great advantage for the homeowner. Although it cannot be sold, it can be used as security when applying for a home equity loan (also known as a reverse mortgage).

A senior Canadian citizen often will have no issues tapping into home equity by applying for a home equity loan. The value of the loan will depend on several factors including the value of existing equity, the real estate climate in the area, location of the property, prior debts, type of home, and the age of the homeowner and spouse.

Use Your Home Equity with A Reverse Mortgage

With a home equity loan aka a reverse mortgage, you can choose to receive funds over a period of time as a sort of income or take the amount as a lump sum. You will continue to own your home as long as property insurance and taxes are paid and that you keep the property well maintained.

Another good thing with a home equity loan is that no regular payments are required because the loan won’t be due until the homeowners move out or when the home is sold. Note though that any interest will be added to the original amount owed. The equity that remains after that amount is paid still belongs to the homeowners or their estate.

Your home equity loan funds can be used for:

  • Funding for a hobby or travel
  • Paying off debts
  • Funding necessary home improvements such as moving the master suite downstairs when your needs change
  • Covering unexpected expenses such as emergency medical bills
  • Paying for higher education for your children or grandchildren (or yourself!)

Apply for a Home Equity Loan!

If you are a Canadian home owner who needs extra funds to maintain your lifestyle or to finance something important, a home equity loan can surely work for you. No issues as well even if you are over the age of 55!

Are you interested in discussing the ways you can use your home equity as a senior with Canadian mortgage professionals? Contact us at Homebase Mortgages and we will make sure that you fully understand the benefits before committing to anything.

5 Steps to Consolidate Debt

Waiting for magic and hoping your debts and bills will go away won’t happen without a little help from you. Know that although you can’t really make debt disappear, you have the power to make it easier to pay via debt consolidation.

Why Consolidate Debt?

Managing several debts with various interest rates and due dates can be very stressful. Consolidating your debts into one helps you keep track of payments faster and even opt for a lower overall interest rate. Yes, the initial step of documenting what amounts you owe and to whom can be daunting, but the long term benefits outweigh the initial effort you have to put in.

Consolidating debts is a big challenge for most people, that’s why we listed the 5 steps that you can take with the help of a financial expert to make things more manageable for you. Read about them below!

Get to Organizing

Find out what you owe and to whom. This allows you to have a better awareness of your credit status and credit rating, the crucial numbers that you’ll help improve as you pay off your debts after consolidation. Note that fees will usually be involved in this stage.

Start with contacting your credit bureaus and move to taking a detailed inventory of your debts. Take small steps. Don’t forget to keep accurate records more so when you start paying everything off.

Find Available Debt Consolidation Options for You

Depending on your area, you may seek the help of mortgage brokers to guide you in the debt consolidation process. Some options may be better for you compared to other means based on your needs and means. Private lenders, banks, or credit unions may all have solutions for you, the trick is finding the best one to avoid future problems.

Apply for a Loan

Once you already know how much you need and have picked a lender for debt consolidation, the next hurdle is actually getting approved for it. Knowing how the process work counts the most in terms of getting approved.

Make sure that you’ll be applying for a loan that will cover all your debts to avoid future issues. Choose the one with payment terms that you can afford. The last thing you want is to end up in worse financial status after this. Get a mortgage broker to go over your list and the payment terms to ensure you’re not missing anything important.

Bounce Back

Bouncing back can mean the actual process of paying for your debts or reapplying for a loan if you got turned down. If your application wasn’t approved, then note your mistakes and don’t be afraid to ask about what went wrong.

Consolidate Your Debt

Once you get approved, be sure to pay off your existing debts and use any extra money to pay the loan back. Remember that paying your debt on time will ensure you incur only the bare minimum of interest and help improve your credit rating and financial record.

Need the help of a mortgage broker so you can consolidate your debts? Contact us today! We’ll be happy to assist you towards your goal.

10 Top House-Hunting Mistakes to Avoid

House-hunting is not for the weak of heart. It is more than just calling some real estate agents, seeing a few houses, and moving in right after you found one you like. Things can get very challenging when looking for a new home more so if you’re targeting buying a home in a hot neighbourhood. You need to be smart about your search and come up with a game plan for house-hunting success!

Below is our compilation of the top 10 house-hunting mistakes that you need to avoid.

Listening to Advisers Who Don’t Live With You

Input from some people is great, but not if they won’t be living with you anyway. Opinion from other people might confuse you and won’t really help you because they would often be speaking about their needs, not yours.

Going in with No Mortgage Pre-Approval

The last thing you want to convey when house-hunting is for real estate agents and home sellers to think that you’re not serious about your search. This can mean losing out to another buyer who can make a solid offer. More so, mortgage pre-approval lets you know exactly what you can afford.

Not Seizing the Moment

Go see a new listing if you’re interested. Waiting just a few hours can mean someone might beat you to it in a tight market.

Not Checking the Neighbourhood

How would you feel waking up to the neighbour’s loud drum practice on your first morning in your new home? How about having a hard time getting out in the morning because there is a school nearby and the street is filled with family vehicles and school buses? Always check the small details.

Getting a Crush on Sparkly New Features

Newly renovated and newly constructed homes have a tendency to make someone want to own them right off the bat, but you have to think that a home is more than new features! Note that most low-quality finishes and materials look great when new but are worthless in the long run.

Not Being Sure What You Want

You have to know what features you want before shopping for a home or you’ll risk not finding any or being overwhelmed with possible choices. This would save you time too by narrowing your search.

Being Mesmerized By Décor

Don’t forget to assess whether you’re just loving the staged decorations or the home itself. Unless the home sellers are going to leave everything with the house, you’ll end up with a shell that you’re not sure you like anyway.

Not Settling for Anything Less Than Absolute Perfection

Your 100% dream home may not exist, so why not consider one that ticks most of your boxes although not all of it? It’s easy to fall for thinking that something better will be available soon.

Not Taking Your Time in an Open House

You need to have a real feel of the house and explore it in detail before you make the decision of making an offer for it. Check nooks and crannies, open cabinets, use the bathroom, inspect the kitchen and so on. Make sure you don’t skip the basement and the attic!

Forgetting to Have An Agent

House-hunting in a hot market without an agent is a waste of time, energy, hope, and effort. Up your chances of sealing a deal by having an agent who can get you first dibs on new listings. Less negotiation error too!

Need help house-hunting in OakvilleContact us and find out what makes our agents the best this side of the GTA. We also make magic happen when it is time to let go of your Oakville home!

What Makes the Toronto Home Market So Out of This World?

In case you’re not aware of this Canadian real estate trend, the Toronto real estate market is crazy! Or is it? Numerous write-ups have been published about how out of this world the market in Toronto is at present time…but, is it really that vastly different from any other sought-after areas? Find out below!

What you have to understand is that any market has several factors affecting it. Toronto has more than several but today, we’ll be focusing on the 3 main factors that are driving the real estate boom.

The Toronto real estate market is being driven by these major factors:

Restricted Supply

The Greenbelt Act of 2005 ensured that the land across GTA up to Lake Scugog and Rice Lake won’t be developed as residential nor commercial space. Back then, the Liberal government froze the development of about 1.4 million acres of land from the Niagara River all the way to the Golden Horseshoe area. This created the ‘GTA Island’ effect. The nearest developed areas outside of the GTA is a few hours of commute away, prompting people to choose between buying in the GTA if they afford it, or commute a few hours a day to and from work.

Because only a limited area of land can be bought for building homes, Toronto real estate has a steady demand from people wanting to live within the GTA. The constant deficit is because the supply cannot keep up with the demand all because of restricted land supply.

Booming Population

It isn’t a secret that Toronto’s population is rapidly increasing. Existing residents are building families, and the opportunities plus great quality of life are driving people to want to move in Toronto.

In 1986, there were only 3.7 million people in Toronto. This increased to 5.5 million in 2005 and is at around 6.3 million these days. The population is projected to reach 7.3 million in 2021 and climb as high as 9.1 million in 2036! That’s 3 million new residents in just 20 years from now!

There is no denying that Toronto’s population is booming. With more people comes the demand for more homes. The available land for development isn’t going to suddenly increase anytime soon and as a result, existing available land soared in prices, especially those that would make good condo development sites.

Record Low Interest Rates

Toronto is currently at its record low interest rates. At present time, a $500,000 mortgage goes for $2,117 a month with today’s interest rates and a $1 million mortgage goes for $4,234 a month. Compare that to having a mortgage with a 10% interest rate and you’ll be paying $4,272 a month for a $500,000 mortgage. Such a huge difference! Good thing that the last time Toronto had a 10% interest rate was 20 years ago, eh?

So, is the Toronto real estate market truly out of this world crazy? That’s for you to decide.

Different people have different definitions of what crazy is. If you’re trying to purchase a modestly-priced home in Toronto, then you might say the cut-throat competition is on the crazy side. If you’re someone looking for great real estate deals, then you might think it is crazy not to try to get yourself a piece of the action, especially with the low interest rates and possible high reselling profits if current trends are to continue

6 Unbelievable Facts About Toronto’s Real Estate Market

If you’ve been following real estate news for the past few months, then you already know about the gravity-defying powers of the Toronto real estate market. Let us continue to wow you with 6 unbelievable facts about Toronto’s Real Estate Market below!

Skyrocketing Home Prices

Okay, this may not be new for you but do you know that the average price for a detached home in Toronto is now well above the $1.2 million mark? At an actual average price of $1.285 million, Toronto homes are now priced at 15.2% more than what they cost just a year ago.

As for the average home price (not just detached ones), it is now at $782,051 – a figure that is still likely to increase over the next few years because of high real estate demand, low supply, increasing interest from foreign buyers, and low bank interest rates.

Migration Boom

An estimate of about 2,800,000 new residents will call GTA their home in the next 25 years according to the Ontario Government. This means that by 2041, the region will be home to about 9.5 individuals, a 43% increase from the current population.

This Toronto migration boom is not just because of the influx of foreigners but is also because of the increasing number of Canadians who are now eyeing Toronto as their future home.

Real Estate Profitability

When it comes to gauging real estate profitability, cap rates are one of the major factors. It is the number that measures the return on investment if a landlord decides to rent out property. It is the annual return after all operating expenses such as maintenance and property taxes have been paid but before profit taxes are deducted. Isn’t it surprising that there isn’t much left over once the investor pays their profit taxes and mortgage interest?

20 Years to Pay

Numbeo says that a renter of an average property in Toronto’s downtown will take about 20.36 years to be able to pay the rented property’s market value. Considering that prices can get even higher outside the centre of the city, this is surprising indeed!

Numbeo is a website that measures prices of homes in various cities all over the world.

$25 Billion in Loans

Canada’s largest subprime mortgage lender, Home Capital Group Inc. has $25,222,523 worth of outstanding loans. About 90% of these loans are by people living around or in Toronto.

11 Homes per 1,000 Individuals

A recent report from the Royal Bank shared that for every 1,000 Toronto citizens, 11 housing units are being currently constructed. The report also shared that more than 4.5 per 1,000 people is considered high-risk zone.

At current time, the Toronto Real Estate Market is still hotter than ever, with prices still going up and showing no signs of slowing down in the near future.

Not sure whether you want to plunge into Toronto’s Marketplace? Stay tuned for more Toronto Real Estate news and updates! Better yet, contact us for any questions and don’t forget to register for Canada’s first ever International Property Investment Show!


Enhance Your Home’s Value by Doing a Home Appraisal

If you’ve had your home for a few years now, chances are that your home’s current market value is now significantly different compared to when you first moved in. If you’re wondering what is your home’s value now, then a home appraisal is a must!

What to Expect for a Home Appraisal

Once the home appraiser arrives at your home, he or she will tour your whole place. Your home will be examined for what’s good, what’s changed, and what’s broken. All these data will be compared the same data set when you bought your property. The resulting current value is hopefully greater than that to allow you to get a greater selling price.

It should be noted that a home appraisal is not just for merely satisfying your curiosity. If you’re planning to rent, sell, or refinance your home, getting its up-to-date market value straight from a professional home appraiser is in order.

The whole process of home appraisal will set you back a few hundred dollars, but you can easily get that value back especially if you call around to find the right professional for you. More so, you can get a lower capital gains tax should you decide to sell if the property you’re appraising isn’t your primary home and has had upgrades.

Take note that a home appraisal can likewise reduce your home’s current market price because it can highlight any home problems you may have. This is why it would be best to do easy and minor repairs that pack a ton of value.

Preparing for the Home Appraiser

Since the home appraiser will be assessing your home, it is advisable to make your home look its best. After all, you will want the home appraiser to like what he or she will see. Below are some tips for you.

  1. Clean up. Make everything tidy and be sure to clean your walls, floors, carpets, and baseboards. A clean base will go a very long way.
  2. Make your outdoors shine. It is so easy forget the outdoors but remember that your lawn and backyard is part of your property too. Clean up any debris, mow the lawn, add some flowers and greens, and be sure to clear snow from all paths if the home appraiser is visiting you in winter.
  3. Upgrade what needs upgrading. Old shower heads, leaky faucets, and dated light fixtures making your home look and feel drab? Change them up now!
  4. Repair what needs repairing. Have cracks in the walls, broken windows, and non-functioning lights? Fix them ahead of time. They can seriously decrease your home’s value.
  5. Do your research. There’s a big chance that the home appraiser already knows how much other homes in your area are being sold for so you knowing the same surely won’t hurt.

Once you’ve done all of the above, it is time to welcome the home appraiser to your home. Be there to answer their questions and walk them through your place. Once your home appraisal is done, you’ll hopefully hear that your home has a higher marker value now compared to how much you bought it for.

Planning to refinance your mortgage or go for a second mortgage? Contact your Toronto mortgage brokers! We’ll help you get in touch with private lenders that offer the best rates for your needs. Get in touch with us today!

Understanding Mortgage Terminology

Before you start hunting for the best mortgage, you’re going to want to take a step back and learn some of the terminology. A combo-VRM with a 20% balloon payment at 3/1 might be the best thing for you, if you know what any of that means! Here we’re going to go over some of the terminology you’ll find with mortgages so you can have a better understanding of what you’re walking into. This is just a brief description of terms and in no way is meant to be a comprehensive list.

Balloon – also known as the surprise; a balloon payment can be due at the end of a loan, usually called a balloon because it expands beyond its regular size. So if your monthly payment is $150 your balloon payment could be $6000 to close out your mortgage.

Bridge Loans – These bridge the gap in financing until you’re liquid. There are rules for bridge loans; you’ll need to be in the process of selling your current home and buying a new one to qualify.

Closing Costs – The fees you pay when you buy your home. Taxes, legal fees, title insurance and search, all this is rolled into that.

Combination Mortgage/Combo – A combo mortgage is a mortgage that starts out as a fixed or variable rate mortgage and transitions into the other after a certain amount of time.

Down Payment – This can be anywhere between 5% and 20% (or more) of the purchase price of the home. The bigger the down payment the more you save.

EMD or Earnest Money Deposit – A way to sway a buyer to take your bid. Akin to a bribe, but more of a gift.

Escrow – Money held by a 3rd party, fraud protection. The length of your escrow will usually depend on the amount of money involved.

Fixed Rate Mortgage – A mortgage that stays the same throughout the life of your loan, with a few exceptions. Best for long term buyers.

Jumbo Loan – A large loan, usually over $500,000. Jumbo loans can be packaged to save you money, but talk to a mortgage broker to know for sure.

Private Mortgage Insurance – Private mortgage insurance covers the lender in the case that you default; they’ll still be able to collect, a tax on people with no credit or bad credit.

Upside Down – Being upside down on your mortgage, or “underwater” means that you owe more than your home is worth. This happens when you get behind on payments or end up with a  mortgage that isn’t well suited for your financial situation.

VRM – A Variable Rate Mortgage; these can be both good and bad. Depending on how it’s structured these are usually good for borrowers that are seeking a short term loan that they can repay quickly, taking advantage of low interest rates.

It’s important to work with a broker before moving forward; the last thing you want to do is end up with a  mortgage that just isn’t right for you.