COVID-19 and Your Mortgage

Learn about your options today!

Welcome to the April issue of my monthly newsletter!

As your dedicated Dominion Lending Centres mortgage broker, I am happy to help guide you through the current climate amidst the COVID-19 pandemic. I understand that things can be stressful but I am here to help!

In order to mitigate the financial strain on your family, the Canadian government is offering a variety of options to individuals affected by COVID-19. Some of these options include additional GST credit support, a $2,000 monthly Canada Emergency Response Benefit, student loan deferral and mortgage deferral for up to six months. Visit the Dominion Lending Centres dedicated website for more information about COVID-19: https://dominionlending.ca/covid-19

As your mortgage professional, I want to provide you with detailed information regarding mortgage deferral and your options during this time. Please find some helpful insights below!

Thanks again for your continued support and referrals!

To Defer or Not to Defer

With Canada’s major Mortgage Finance Companies (MFC’s) and all six big banks offering mortgage deferrals of up to 6 months, as well as case-by-case options from credit unions, one of the major questions currently facing Canadians amid COVID-19 is do you defer your mortgage? To help you with this decision, we have gathered some important information on what it means to defer and the benefits (or side-effects) from doing so.

For anyone who is unsure, a mortgage payment deferral means that customers are not required to make regular payments (principal, interest and property tax, if applicable) on their mortgage. In the case of COVID-19, this deferral period can be up to six months.

As much as you may be keen on taking advantage of deferring your mortgage, it is essential to remember that this is not “free money”. During the time mortgage payments are deferred, it is important to understand that interest will continue to accrue and will be added to the mortgage account balance at the end of the deferral period. That said, depending on your financial situation, this may be a great option for those individuals who are facing lower monthly income due to COVID-19.

When deciding whether to defer, I recommend you have an honest conversation with yourself about your financial situation.

1. Have you lost monthly income due to COVID-19?
2. Are you struggling to pay your monthly bills as a direct result of COVID-19?
3. Are you finding yourself extra stressed about your finances?

Remember, deferring payments is as much an emotional and mental decision as it is a financial one. In most cases, if you are really stressed and struggling then deferral is the way to go as it will help free up some income right away for families with reduced or no monthly income due to COVID-19.

To give you a rough idea of the true cost of deferral, RBC Bank has put out a great ‘ Skip a Payment ’ tool to help you understand how deferring your payment will work. This calculator will show you the amount owing after any deferred payment(s) to give you an idea of how affordable it may be for you. For example, if you have a mortgage rate of 2.80% and 20 years remaining, a single skipped payment of $2,000 will cost you an extra $1,403 over the long-term. Depending on your financial situation and regular monthly income, deferring your mortgage for six months might be a no-brainer for you – especially if it opens up your current finances for other bills.

If you are leaning towards deferring, please book your virtual appointment so we can go over your unique situation and I can help explain the costs to you and determine if it is the right option! If deferring is right for you, contacting your lender to apply and take advantage of this offer will be the next step. Ensuring you have approval for deferral will prevent any impact on your future credit rating.

Lock-In or Stay Variable?

Whether you already have a mortgage or are looking to get your first mortgage amid COVID-19, there are some things you should know regarding fixed and variable rate mortgages during this time.

If you currently have a mortgage, you may have heard on the news about interest rates rising and you may be unsure of where you stand. It may seem confusing, but when it comes to mortgage rates and interest we are seeing things moving in both directions – rates are going up and going down simultaneously. Depending on the mortgage you currently have (fixed or variable) you may be experiencing different effects with regard to COVID-19 and may be unsure where you stand. Here are some things to know:

Variable Mortgages
Variable rate mortgages, which represent 1 in 4 mortgages in Canada, are driven by the Bank of Canada’s overnight lending rate. Having a low variable rate may lead you to have some concerns surrounding the increasing mortgage rates in the country and where that leaves you.

The Bank of Canada has already made several cuts to the bps rate for a full 1% drop. It is important to understand that these cuts to the overnight lending rate actually get passed down to variable mortgage rate holders – unlike for fixed rate mortgages.

If you currently have a variable rate mortgage you most likely already have a discount from prime. As a result, you may have already seen your rates decrease and you may now be sitting around 1.85% to 2.2% variable interest currently. You may be concerned about these rates rising again but the good news is that it is unlikely that you will see significant rate volatility or increases in interest rates on a variable mortgage.

A mortgage professional can help assess your particular financial situation and mortgage, but most variable-rate mortgage holders will benefit the most by not doing anything with their mortgages at this time as the rates are expected to remain low and possibly even decrease.

Fixed Rate Mortgage
Many Canadians are currently locked into a five-year fixed rate mortgage and these individuals are currently seeing a different trend with their mortgage. To help you understand this further, it is vital to recognize that fixed rates are typically linked to the bond market in Canada, as opposed to the Bank of Canada which is the driver for variable-rate mortgages. Therefore, you can have the bond market and Bank of Canada doing two separate things resulting in both an increase and a drop in interest rates, depending on which rate type of interest you hold.

If you are one of the many Canadians with a five-year fixed-rate mortgage, you are likely seeing your interest rates increasing due to the resulting turmoil in the stock and bond markets. The changing market is resulting in a pull-back from investors who don’t want to lend out funds at such low rates. In addition, with the COVID-19 mortgage relief options, banks are seeing a very large increase in demand for mortgage products and inquiries. This is continuing to drive demand with no increase in supply, which also results in rate increases.

If you are currently in a fixed-rate mortgage, it is important to understand your options and how long they expect rates to be increased. If you are considering converting your fixed-mortgage to a variable-rate mortgage, you will likely have a 3 month payment penalty. Depending on your mortgage amount, this may be a small price to pay for a lower interest rate for the foreseeable future. I would be happy to discuss this with you to guide you to the best decision for your financial situation and capacity.

New Mortgages
If you do not have an existing variable or fixed mortgage and are in the process of getting a new mortgage, refinancing or renewing you may be wondering what to do. While mortgages will vary on a case-by-case basis, the current consensus from mortgage professionals is that a variable-rate mortgage will be the way to go, especially if you can get a discount on prime that puts you around 2%. While there is talk of mortgage rates increasing, the impact to a variable-rate mortgage is likely to be minimal (if at all).

Tips for Social Distancing & Staying Safe From Home

Stay Safe. Stay Home. Save Lives.

This is currently the motto for Canadians who are working hard across the country to combat COVID-19 by staying home – including your mortgage brokers! While social distancing of this magnitude has never occurred previously, it is important to understand that we are all in the same boat. To help you get through this period, I have put together some tips for social distancing and staying safe (and proactive!) at home:

• Follow Best Practices:
  Ideally, to make social distancing most effective, individuals are only interacting with their household during this time and until the pandemic is under control. Some other best practices include:
  • If you have to go out and restock your pantry or get supplies, try to only go out once per week.
  • Be mindful of other consumers; do not overstock.
  • If you are out in public, be sure to stay at least 6ft away from other individuals.
  • On walks, do not let your dogs say ‘hi’. They will forgive you, we promise.
• Maintain Your Routine:
  When the world feels like it is going crazy, one of the best things you can do to keep your sanity is to maintain your routine. Whether you’re out of work or working from home, making sure that you continue to get up at your normally scheduled time and go through your morning process is a great way to maintain stability. Taking your regularly scheduled breaks, such as lunch hour, while working from home are also important to maintain your schedule (and keep sane). Be sure to continue to maintain social distancing procedures during this time.
• Get Up and Move:
  It can be hard to feel motivated, but it is important to make sure to get up and get moving when you are able. From a home workout to a walk, everything works towards keeping your body and brain healthy; especially during times of extra stress. Carve out 15-60 minutes per day for some light physical activity and you will be amazed at how much better you feel!
• Connect With Others:
  In today’s world, we have a plethora of technology at our disposal. Even if you feel alone, there are ways to reach out to friends and family through Skype, Houseparty, Zoom Meetings, e-mail, text and an old fashioned phone call. While it is vital to maintain physical distance, we as humans require connection so be sure to utilize the tools around you and don’t be afraid to share your feelings – your friends are all in the same boat and will understand.
• Stay Informed:
  Information is power and the more information you have at your disposal as this situation develops, the better prepared you will be to manage your household and finances. Dominion Lending Centres dedicated COVID-19 website is a great resource for staying up to date: https://dominionlending.ca/covid-19/

Bank of Canada Moves to Restore “Financial Market Functionality”

The Bank of Canada today lowered its target for the overnight rate by 50 basis points to ¼ percent. This unscheduled rate decision brings the policy rate to its effective lower bound and is intended to provide support to the Canadian financial system and the economy during the COVID-19 pandemic (see chart below).

Strains in the commercial paper and government securities markets triggered today’s action to engage in quantitative easing. The Governing Council has been meeting every day during the pandemic crisis. Market illiquidity is a significant problem and one the Bank considers foundational. These large-scale purchases of financial assets are intended to improve the functioning of financial markets.

Credit risk spreads have widened sharply in recent days. People are moving to cash. Liquidity has dried up in all financial markets, even government-guaranteed markets such as Canadian Mortgage-Backed securities (CMBs) and GoC bills and bonds. The commercial paper market–used by businesses for short-term financing–has become nonfunctional. The Bank is making large-scale purchases of financial assets in illiquid markets to improve market functioning across the yield curve. They are not attempting to change the shape of the curve for now but might do so in the future.

These large-scale purchases will create the liquidity that the financial system is demanding so that financial intermediation can function. Risk has risen, which creates the need for more significant cash injections.

At the press conference today, Senior Deputy Governor Wilkins refrained from speculating what other measures the Bank might take in the future. When asked, “Where is the bottom?” She responded, “That depends on the resolution of the Covid-19 health issues.”

The Bank will discuss the economic outlook in its Monetary Policy Report at their regularly scheduled meeting on April 15. In response to questions, Governor Poloz said it is challenging to assess what the impact of the shutdown of the economy will be. A negative cycle of pessimism is clearly in place. The Bank’s rate cuts help to reduce monthly payments on floating rate debt. He is hoping to maintain consumer confidence and expectations of a return to normalcy.

The oil price cut alone would have been sufficient reason for the Bank of Canada to lower interest rates. The Covid-19 medical emergency and the shutdown dramatically exacerbates the situation. All that monetary policy can do is to cushion the blow and avoid structural problems to the economy. The overnight rate of 0.25% is consistent with market rates along the yield curve.

High household debt levels have historically been a concern. Monetary policy easing helps to bridge the gap until the health concerns are resolved. The housing market, according to Wilkins, is no longer a concern for excessive borrowing by cash-strapped households.

At this point, the Bank is not contemplating negative interest rates. Monetary policy has little further room to maneuver, given interest rates are already very low. With businesses closed, lower interest rates do not encourage consumers to go out and spend money.

Large-scale debt purchases by the Bank will continue for an extended period to provide liquidity. The Bank can do this in virtually unlimited quantities as needed. The policymakers are also focussing on the period after the crisis. They want the economy to have an excellent foundation for growth when the economy resumes its normal functioning.

Fiscal stimulus is crucial at this time. The newly introduced income support for people who are not covered by the Employment Insurance system is a particularly important safety net for the economy. There are many other elements of the fiscal stimulus, and the government stands ready to do more as needed.

The Canadian dollar has moved down on the Bank’s latest emergency action. The loonie has also been battered by the dramatic decline in oil prices. Canada is getting a double whammy from the pandemic and the oil price war between Saudi Arabia and Russia. The loonie’s decline feeds through to rising prices of imports. However, the pandemic has disrupted trade and imports have fallen.

The Bank of Canada suggested as well that they are meeting twice a week with the leadership of the Big-Six Banks. The cost of funds for the banks has risen sharply. CMHC is buying large volumes of mortgages from the banks, which, along with CMB purchases by the central bank, will shore up liquidity. The banks are well-capitalized and robust. The level of collaboration between the Bank of Canada and the Big Six is very high.

THE STOCK MARKET HAS HAD THREE GOOD DAYS

As the chart below shows, the Toronto Stock Exchange has retraced some of its losses in the past three days as the US and Canada have announced very aggressive fiscal stimulus. As well, the Bank of Canada has now lowered interest rates three times this month, with a cumulative easing of 1.5 percentage points. The Federal Reserve has also cut by 150 basis points over the same period. In addition to lowering borrowing costs, the central bank has also announced in recent days a slew of new liquidity measures to inject cash into the banking system and money markets and to ensure it can handle any market-wide stresses in the financial system.

The economic pain is just getting started in Canada with the spike in joblessness and the shutdown of all but essential services. Similarly, the US posted its highest level of initial unemployment insurance claims in history–3.83 million, which compares to a previous high of 685,000 during the financial crisis just over a decade ago. These are the earliest indicator of a virus-slammed economy, with much more to come. All of this is without precedent, but rest assured that policy leaders will continue to do whatever it takes to cushion the blow of the pandemic on consumers and businesses and to bridge a return to normalcy.

Dr. Sherry Cooper

Chief Economist, Dominion Lending Centres

Dr. Sherry Cooper discusses Canadian mortgage rate drop on CTV

Dr. Sherry Cooper discusses Canadian mortgage rate drop on CTV

Dr. Sherry Cooper discusses Canadian mortgage rate drop on CTV

What You Need to Know Before you Buy

Spring is one of the busiest seasons for retail activity as the good weather gives people lots of time for decluttering, showing the home, garage sales, packing and moving into your new space! Buying a home is an extremely exciting and fulfilling adventure, but before you get started let’s go through some of the most important things you need to know before you buy a home.

First things first, are you ready to own a home? This is likely the largest financial decision you will ever make and there are a few questions you can ask yourself to ensure you are ready:

• Are you financially stable?
• Do you have the financial management skills and discipline to handle this large of a purchase?
• Are you ready to devote the time to regular home maintenance?
• Are you aware of all the costs and responsibilities that come with being a homeowner?

If you answered ‘yes’ to the above questions, congrats! You’re on the right track. Let’s look at some of the most important things to know:

Securing Your Down Payment
A down payment is the largest, upfront cost that comes with purchasing a home. The minimum on any mortgage in Canada is 5 percent but putting down more whenever possible will lower the amount being borrowed. Note: If you are putting down less than 20 percent, default insurance will be mandatory to protect the investment.

If you have a nest egg of savings that you can apply towards the down payment, then you are ready to move on! If not, RRSPs can be a great resource towards a down payment for a first-time home buyer (up to $35,000). Another option is a gift from a family member, which requires a Gift Letter stating that the money does not have to be repaid and a snapshot showing that the gifted funds have been transferred.

If these are not options for you, then you can still work on ensuring you have a good credit score and determining your budget while saving for a down payment in the meantime.

Getting Your Credit in Order
Ensuring your finances and credit is in order will make it easier to qualify for a mortgage and can be done while you’re saving for your down payment. Ensuring good credit simply involves paying your bills on time (rent, utilities, car payments) and ensuring your credit cards are paid monthly as well as keeping the balance below 75 per cent of the available limit. If you’re new to the world of credit, consider the 2-2-2 rule. Lenders want to see two forms of resolving credit (ie: credit cards) with limits no less than $2,000 and a clean payment history for two years. Another important note is to avoid making any credit mistakes or other major purchases (such as a new car) until after you have mortgage approval and have closed the deal on your new home.

Don’t Use Your Maximum Budget
Temptation will always be to start looking at the very top of your budget, but it is important to remember that there will be fees, such as mandatory closing costs, which can range from 1 to 4% of the purchase price. Factoring these into your maximum budget can help you narrow down a home that is entirely affordable and ensure future financial stability and security.

Get Pre-Approved
A mortgage pre-approval determines the actual home price you can afford and is different from the pre-qualification in that it requires submission and verification of your financial history. A pre-approval can determine the maximum you can afford to spend, the monthly mortgage payment associated with your purchase price range and the mortgage rate for your first term. Getting pre-approved also guarantees the rate offered to you will be locked in from 90 to 120 days which helps if interest rates rise while you are still shopping.

Refinancing Your Mortgage

Spring is a great time for cleaning out your home and your finances. A part of this for many people includes refinancing your mortgage. There are a variety of reasons to refinance, which can range from wanting to leverage large increases in property value or get equity out of the home for renovations. In some cases it could be due to life events such as divorce, a new relationship, kids going off to college or simply consolidating debt.

Before you refinance, it is important to understand that if you do this during your term you will be breaking your mortgage agreement and there are penalties that come with that. If at all possible, it is best to wait until the end of the mortgage term before refinancing.

There are a few points to consider before refinancing:

• You can tap into 80 per cent of the value of your home
• You cannot qualify for default insurance which can limit your lender choice
• You would have to re-qualify under the current rates and rules

Talking to a mortgage broker about refinancing can provide you access to even greater rates and mortgage products to best suit your needs and what you are trying to accomplish through your refinancing strategy.

Regardless of why you are looking to refinance, it can come with a host of great benefits when done properly!

1. Getting a lower interest rate:Depending on where you are in your mortgage term, you could refinance to get a better rate – especially when done through a mortgage broker. A mortgage broker has access to hundreds of lenders and is able to find you the best rate versus traditional banks which only have access to their own rate.

1. Consolidating your debt: When it comes to debt, there are many different types from credit cards to lines of credit to school loans to mortgages. However, many types of consumer debt have much higher interest rates than those you would pay on a mortgage. Refinancing can free up cash to help you pay out these debts. While it may increase your mortgage, your overall payments could be far lower and would be a single payment versus multiple sources. Keep in mind, you need at least 20 percent equity in your home to qualify.
2. Change your term or get a different mortgage: The beauty of life is that it is ever-changing and sometimes you need to pay off your mortgage faster or change your mortgage type. Maybe you came into some extra money and want to put it towards your mortgage or maybe you are weary of the market and want to lock in at a fixed-rate for security.
3. Tap into your home equity: One of the biggest reasons to buy in the first place is to build up equity in your home. Consider your home equity as the difference between your property’s market value and the balance of your mortgage. If you need funds, you can refinance your mortgage to access up to 80% of your home’s appraised value in cash!

Always remember – it is best to refinance when your mortgage term is up to avoid penalties. Talking to a mortgage broker can help clear up any concerns and they can walk you through the process depending on your needs.

Homeowner Tips

10 Spring Cleaning Tips

1. Create a Playlist
   Everything – including Spring cleaning – is more fun with a great playlist! Not only is music great therapy but it can make the cleaning process go by quicker and make it more enjoyable.
2. Clean One Room at a Time
   Most people dread Spring cleaning. Everyone likes the aftermath and seeing their home all sparkly and fresh but sometimes it can be an overwhelming process to get to that point. It is best to clean one room at a time, starting with the smaller ones or those that need the least amount of cleaning and work your way up to the larger, project rooms. Another great way to reduce stress over spring cleaning is to tackle one or two rooms each weekend for the month and by the time April comes, you’ll be ready!

3. Declutter as You Go
   Spring cleaning isn’t just about shining up the brass on the door and dusting. It is just as important to declutter your space as you go! Before you start cleaning the room, it is a good idea to pinpoint items that can be discarded, such as old magazines and papers, as well as to go through closets and cupboards for anything that you can donate (like that sweater you bought and never wore). This will clear up space for new clothing and items and will make you feel that much more accomplished!

1. Think Green!
   The idea of Spring cleaning is starting the season off on a fresh, clean note. Don’t muddy that up with harsh chemical cleaners. In today’s ecofriendly environment, there are many eco-friendly and safe alternatives to regular cleaners. Vinegar is a great substitute in the bathroom or kitchen as well as combining vinegar, baking soda and water as a deep clean alternative. You can also opt for a steam cleaner to manage tile, hardwood floors, appliances and even outdoor areas as they only use hot water and vapor. While not everything can be cleaned this way, it is best to minimize chemical cleaners as much as possible.
2. Work From Top to Bottom
   Starting from the ceiling and working your way down just makes sense! This will force debris downward and save you having to re-clean your space. Dusting first will prevent a headache later too!
3. Save Windows for a Cloudy Day
   Washing your windows after the build-up of winter grime is one of the biggest parts of Spring cleaning as you’ll want to wash them on the inside and outside. However, washing windows in direct sunlight (or using paper towel) can cause streaks. To minimize this and maximize your cleaning efforts, use a microfiber cloth and save this task for a cloudy day!
4. Plump Up Those Pillows
   Fresh linens is one of the most rewarding things about cleaning, period. There is nothing quite like your face hitting a fresh, plumped up pillow and settling into a freshly flipped mattress. Washing your pillows with ½ cup of baking soda added to the detergent cycle will really get them extra clean! You can fluff them up even more by putting them in the air cycle of your dryer with two tennis balls in socks.
5. Most of us are guilty of hanging onto old clothes that we haven’t worn in three years or a pair of jeans that we know we will never fit again, but just can’t let go of. Now is the time to say goodbye to those worn out, ill-fitting or stained clothes! There are many opportunities to donate old clothes that are still in good shape too. Not only does that lend a helping hand to individuals who may greatly benefit from them, but it frees up space in your closet for new items that you absolutely LOVE!

9. Don’t Forget The Fridge & Freezer

The best time to clean out your fridge and freezer is right before you do your grocery shop, so they will be at their most empty. Take everything out and dispose of anything that is past its expiration date and any almost-empty items you won’t use. Before you restock be sure to wipe down the interior of the fridge with disinfectant and a damp cloth. The same can be done for the freezer but you’ll have to defrost it first!

10. Clean Air Reduces Allergies
    Replacing furnace and HVAC filters is one of the most overlooked parts of Spring cleaning. Going as far as replacing your standard filter with a more robust one with a higher rating will help keep you even healthier (and allergy free!) this year as they catch smaller particles to ensure your home is void of allergens, chemicals and even odors.

Are you in the market for your first home? Dreaming of a space you can call your own? If you are an eligible first time home-buyer, then contributing to your RRSP(s) before the March 1 deadline can help you increase the funds available for your home purchase.

The Home Buyers’ Plan (HBP) is a program that allows you to withdraw from your Registered Retirement Savings Plan (RRSP’s) in order to purchase or build your first home. In 2019 there was a change to the HBP in an attempt to provide first-time home buyers with greater access to their RRSP savings by increasing the withdrawal limit from $25,000 to $35,000.

How do I know if I qualify?

In order to qualify, at least one homeowner must be a first-time homebuyer, which is defined as the following:

• You are considered a first-time home buyer if;
  • You have never owned a home before
  • In the last 4 years, you did not occupy a home that you or your current spouse or common-law partner owned
• You have a written agreement to buy or build a home
• You are a resident of Canada
• You intend to occupy the qualifying home as your principal place of residence within one year after buying or building it
• You have gone through a breakdown of marriage or common-law partnership (even if the other first-time home buyer requirements are not met)

Buying my first home using The Home Buyers’ Plan (HBP)

Once you know you can take advantage of the HBP, and have topped up your RRSP(s) (if applicable), make an appointment with a mortgage professional to complete a financial health check to determine what you qualify for. This will make it easier for you to shop the market so you are able to look at real-estate listings within your budget.

Note * The down payment funds must be in your account for a minimum of 90 days for the withdrawal to qualify under the HBP.

Do I have to pay the government back?

You will have 15 years to repay the amount used from your RRSP(s), or you can pay in full at anytime during that period. Your repayment period starts on the second year after you first withdrew your RRSP(s) for the HBP. For example, if you withdrew $35,000 in 2020 to purchase your first home, you have until 2022 before your repayment schedule commences.

Each year, the Canada Revenue Agency (CRA) will send you an HBP statement with your notice of assessment in order for you to understand how much has been paid back to date, the amount you need to contribute to your RRSP(s) and your HBP balance.

Up or down-sizing? Get yourself mortgage ready for a move this Spring!

Moving homes can be triggered by a variety of things, but the most common reason is space…not enough, or perhaps a little too much.

At some point, the place you thought was your forever home may not meet your needs any longer. If you are growing your family, perhaps your current digs are bursting at the seams. If you are preparing for retirement or thinking about moving cities, a smaller place may be just what you have in mind.

Regardless of if you are moving up or scaling it down, here are a few things you want to consider:

• If you are thinking about making a move before the end of your mortgage term, keep in mind you will need to re-qualify under the current rates.

Moving before the end of your term means breaking your mortgage. Don’t fret, this just means you will pay a penalty. This amount is dependent on your current mortgage provider and the mortgage product/terms.

• Factor in realtor fees, closing and moving costs
  • Realtor fees can be anywhere between 2.5% and 5% depending on where you live
  • For closing costs and legal fees, we suggest you budget approx. 1.5% of the purchase price
  • Moving costs and miscellaneous
    • Put aside approx. $1,000 in moving costs

In addition, you want to think about setting up your utilities, perhaps upgrading appliances, lighting, a fresh coat of paint, or even new furniture. If you are upsizing then the size of your couch may be too small for your new living room! Same can be said if you are downsizing from a larger home to a condo.

Homeowner Tips

Tips for selling your home this Spring

If you are in the market to sell your home this spring, there are a few things you will want to do in order to sell for top dollar.

1. Storage Space
   Every home-buyer is looking for extra storage space, and we all want to envision our things fitting perfectly into our next home. TIP: Before listing your home, remove non essential items from hall and bedroom closets, as well as kitchen and bathroom cupboards. Spend some time to neatly organize what’s left. This will give the illusion of more space and present well to potential buyers.
2. Lighting
   Next to the perfect location, a home with good lighting is everything. TIP: Spend some time cleaning your windows, taking down heavy drapes and update the light bulbs in your home to LED. Making your home bright and warm will leave a glowing impression and make it that much more sellable.
3. Paint
   A fresh coat of paint can make your home feel fresh and remove wear and tear. TIP: Homebuyers today are looking for neutral spaces that they can easily move into. Spend a little bit of money and paint over dark or bright walls with a light grey or beige in order to maximize your homes show power.
4. De-Personalization
   Everyone loves to personalize their space, but this can be a detriment when selling your home as potential buyers have a harder time picturing themselves living there. TIP: Get rid of a third of your things, including family photos, memorabilia and personal keepsakes. Depending on your home, consider hiring a stager to showcase the best use of the rooms in your house.

Curb Appeal
The exterior of the home is the first impression you have to make potential homebuyers fall in love! TIP: Take the time to spruce up the front by repainting your door, replace the house numbers, add a few potted plants to flank the entryway, add a new welcome mat, or trim down the shrubbery. If weather permits, make sure the grass is cut, power wash the walkway and keep things

RRSP Home Buyers Plan

How to leverage your RRSPs to buy your first home.

Are you in the market for your first home? Dreaming of a space you can call your own? If you are an eligible first time home-buyer, then contributing to your RRSP(s) before the March 1 deadline can help you increase the funds available for your home purchase.

The Home Buyers’ Plan (HBP) is a program that allows you to withdraw from your Registered Retirement Savings Plan (RRSP’s) in order to purchase or build your first home. In 2019 there was a change to the HBP in an attempt to provide first-time home buyers with greater access to their RRSP savings by increasing the withdrawal limit from $25,000 to $35,000.

How do I know if I qualify?

In order to qualify, at least one homeowner must be a first-time homebuyer, which is defined as the following:

• You are considered a first-time home buyer if;
  • You have never owned a home before
  • In the last 4 years, you did not occupy a home that you or your current spouse or common-law partner owned
• You have a written agreement to buy or build a home
• You are a resident of Canada
• You intend to occupy the qualifying home as your principal place of residence within one year after buying or building it

You have gone through a breakdown of marriage or common-law partnership (even if the other first-time home buyer requirements are not met)

Buying my first home using The Home Buyers’ Plan (HBP)

Once you know you can take advantage of the HBP, and have topped up your RRSP(s) (if applicable), make an appointment with a mortgage professional to complete a financial health check to determine what you qualify for. This will make it easier for you to shop the market so you are able to look at real-estate listings within your budget.

Note * The down payment funds must be in your account for a minimum of 90 days for the withdrawal to qualify under the HBP.

Do I have to pay the government back?

You will have 15 years to repay the amount used from your RRSP(s), or you can pay in full at anytime during that period. Your repayment period starts on the second year after you first withdrew your RRSP(s) for the HBP. For example, if you withdrew $35,000 in 2020 to purchase your first home, you have until 2022 before your repayment schedule commences.

Each year, the Canada Revenue Agency (CRA) will send you an HBP statement with your notice of assessment in order for you to understand how much has been paid back to date, the amount you need to contribute to your RRSP(s) and your HBP balance.

We support our Local Loggers and are hoping the USW and WFP get back to negotiations soon!

Unfortunately the reality is there are those that are facing the risk of bankruptcy or losing their home. We are here to help! Please contact our one stop shop DLC Coastal Mortgage’s/RealPro Real Estate and talk to Leslie or Paul Stapley for all of your options. Loonies for Loggers has posted a link to some useful information which we are more than happy to share.

https://pubsdb.lss.bc.ca/pdfs/pubs/Cant-Pay-Your-Mortgage-eng.pdf