Minimize the costs of bidding wars

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Most Canadians know it's a better idea to stick to their budgets than get sucked into a bidding war, according to data from the Bank of Montreal.

Figures from the BMO Home Buying Report, which polled 2,000 adult Canadians, show that only 28 percent of homebuyers are willing to fight over a property. This number was higher for first-time homebuyers, with 39 percent saying they'd be willing to enter a bidding war over a home.

Data also shows that bidding wars were more likely to occur in Toronto, Vancouver and Calgary. In fact, a quarter of home sellers in Calgary said they purposefully under-priced their properties in an attempt to spur competition among homebuyers. Continue reading

Pre-approvals and rate holds in home loans

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When it comes to getting a home mortgage approved, "pre-approval" can be one of the trickiest factors in determining mortgage rates. With the housing market always at least somewhat in flux, many people looking to buy turn to pre-approval as a way to find a preferred rate as they search for a home.

But even for mortgage professionals, the term pre-approval can take on different meanings. And to make things even trickier, it is often conflated with the term "rate hold," which to the average consumer, as well as many lenders, sounds like two different things. However, some mortgage professionals view them as the same. So, how does one make sense of this already complicated process when people inside the industry can't even seem to completely agree? Continue reading

Obtaining a mortgage as a self-employed borrower

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With mortgage rates continuing to stay near ultra-low levels, it's no surprise that many Canadians are clamoring to invest in a home purchase or refinance their current home loan. However, the process can be slightly more difficult for one of Canada's growing demographics: The self-employed.

The latest statistics from Industry Canada show that the country has 2.67 million self-employed individuals, which represent nearly 15.4 percent of all the employed workers in the country's economy. In fact, the number of self-employed Canadians has risen steadily over the last 10 years, especially amongst women.

"Over the past decade, the number of self-employed workers increased by 17 percent, while the growth rate of the overall labour force was 15 percent," reads an excerpt from Industry Canada's official website. "Slightly more than one-third of self-employed workers were female – the share of female self-employment rose steadily from 1976 to 1998, from 26 percent to 36 percent, and has remained at around 35 percent since 1999." Continue reading

Understanding homeowners associations

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While most of the focus of the homebuying process understandably rests on financing, different types of properties demand a certain amount of forethought. For instance, if an individual purchases a property that is governed by a homeowners association, wouldn't fully understanding what that means be just as important as haggling over mortgage rates? The rules and regulations associated with homeowners associations can have a major impact on homebuyers. It's with this in mind that Canadians who decide to purchase a property that is part of a homeowners association should make sure they completely comprehend what they're getting into before doing so. Continue reading

Mortgage rates stay low, home prices to rise

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Canadian mortgage rates continue to stay at all-time lows, making homeownership a more affordable prospect for people all over the country. This marks the 29th straight month that the Bank of Canada has left core lending rates unchanged at 1 percent.

Citing low inflation and a sluggish economy, the Bank of Canada stated that rates will most likely remain low for some time.

"Reflecting all of these factors, the Bank has decided to maintain the target for the overnight rate at one percent," the financial institution said. "With continued slack in the Canadian economy, the muted outlook for inflation, and the more constructive evolution of imbalances in the household sector, the considerable monetary policy stimulus currently in place will likely remain appropriate for a period of time, after which some modest withdrawal will likely be required, consistent with achieving the 2 percent inflation target." Continue reading

Choosing the right mortgage broker

When it comes to the world of home loans, mortgage brokers can be invaluable. Not only can they help potential home buyers find the lowest mortgage rates, they can put them in contact with lenders who suit their needs. Of course, as with any service, the process only works if home buyers use the right professional. Fortunately, there are a number of strategies consumers can use to help them choose the right mortgage broker.

Understand the service
Before hiring a mortgage broker, a borrower should fully understand what services they offer. Brokers act as intermediaries between borrowers and lenders, helping the former find the best match with the latter. They can act as guides through each step of the loan process, analyzing a borrower's financial situation and helping to determine loan types that best suit a borrower's needs. Continue reading