A recent study done by the Canadian Mortgage and Housing Corporation found that more Canadians are taking advantage of the mortgage financing services provided by mortgage agents. While back in 1998 less than 10% of all residential mortgages were obtained using mortgage agents, today that number has grown to over 30%.
First time home buyers make up the largest group of Canadians taking advantage of the services being provided by mortgage agents, with almost 40% using agents to acquire their first mortgage. In contrast however, only 10% of Canadians renewing their mortgage used a mortgage agent to shop around for a better deal. The other 90% simply stayed with their current lender, often accepting the first offer they received.
The aforementioned study also found that only half the Canadian respondents knew what role mortgage agent’s played in obtaining mortgage financing. Of those respondents actually familiar with mortgage agents, many thought incorrectly that mortgage agents charged fees directly to the consumer for their services, when in reality mortgage agent’s work for the client but are paid by the lending institution.
So it seems that while many Canadians are slowly catching on to the benefits of working with a mortgage agent, many others are still relatively unfamiliar with the profession and the services available to them. Unfortunately, the end result of this is that many Canadians are needlessly paying higher interest rates and thousands of extra dollars in interest payments over the life of their mortgages.
Today’s diverse and competitive mortgage marketplace makes it essential for Canadians to shop around for the best mortgage rates and terms available to them at any given time. Whether you are purchasing your first home, renewing your mortgage or refinancing, these should all be seen as opportunities to shop around.
As more and more Candians are finding out, using a Mortgage Agent to do the leg work can save you a lot of time and effort, and may save you thousands of dollars!
About the Author
For many families, their mortgage will ultimately serve as the cornerstone of their financial health and well being.
With this in mind comes great responsibility for those entrusted to help individuals sort through the variety of mortgage products available to them.
This is a responsibility I take seriously!
Equity Finance Mortgage has a broad utilization potential for First Home buyers and Up- graders, virtually anyone who wants to get more than their current buying power. Equity Finance Mortgage efficiently raises your potential borrowing capacity. EFM works in conjunction with a traditional home loan. Together they let you move some of the expense of a traditional home loan to later when you eventually sell your property. The equity finance portion can be up to 20 per cent of the purchase value of a new home. The equity finance lender trades off that interest for up to 40 per cent of any future capital gains or 20 per cent of any capital losses on the property as a substitute for a traditional interest rate.
EFM’s are not available for the purposes like building loans with progress payments, investment, other personal use, loan portability, business purposes and vacant land. You are not required to make any regular monthly interest repayments throughout the EFM loan, which you can hold for 25 years. When you sell the property or repay the EFM for some other reason, you repay the EFM amount you originally borrowed plus up to a 40% share of any increase in the value of the property.
It helps in reducing ongoing costs of purchasing a new property. It also reduces your current monthly mortgage repayments by refinancing of your existing loan. You can now afford to buy a more expensive property. You must agree to share with the EFM lender a proportion of any increase in the value of your property over time. If your property’s value increases, the lender will gain, however, if you realize a loss when you sell your property, the EFM lender may share up to 20% of the losses, actually leaving you with less to repay on the EFM loan than they originally lent to you.
About the Author
Max is a Mortgage Broker who has specialized in no deposit home loans for over 5 years.
http://www.homeloanexperts.com.au
In almost all areas of the world central banks have pumped billions of dollars into the economy. The vast fall in credit market liquidity and the resulting economic downturn forced central banks to abandon monetary policy techniques that appeared to work so well over the previous ten years. In desperation central banks resorted to the age old trick of printing money, the impact of which has been twofold.
Firstly, an increased level of cash in the economy has helped to ease credit market tension and promote economic recovery. Secondly, simple monetary economics tells us that there will be a resulting burst of inflation (quantity theory of money). The monetary transmission mechanism would indicate that monetary easing (printing money or lowering interest rates) will have an impact on economic growth in the first place (typically after 12 months) and inflation secondly (18 months).
I think it is fair to say that a stabilisation in the economy has been witnessed in the last 6 months, with growth rates teetering on the border of positive. What we are now starting to witness is the secondary impact, rising inflation. In the UK, inflation is recording record monthly growth under the CPI measure and the highest rises since the 1970′s under the RPI measure. The question is whether these rises are to continue? Given the amount of cash central banks have pumped into the economy it is difficult to see otherwise.
If inflation continues to rise it is difficult to see what central banks will do, risk further recession by increasing interest rates or accept the consequences of sky high inflation? In either case, rising interest rates or rising inflation are likely to force mortgage lenders to increase the interest rates they charge on their loans. Even if central banks keep official rates fixed for some time, high rates of inflation may force lenders to raise rates in order for them to make a real return on their investments (i.e. to avoid negative real interest rates).
For new home buyers it would probably be advisable to take out a fixed rate loan. For existing mortgage holders times might be difficult in an era where loan repayments are likely to rise and wage freezes are prominent (especially as inflation would lower real wages and reduce disposable income). If central banks decide to raise interest rates to tackle inflation there are likely to be negative economic consequences which will probably result in further redundancies.
The insurance market cannot cover individuals who fail to make their payments due to rising monthly repayments but it can cover those individuals who are forced into unemployment. In these uncertain times mortgage protection insurance has become extremely popular and, given the unclear future, a very sensible form of financial protection.
About the Author
This article was produced by James P White of Drewberry Mortgage Protection Cover, specialist providers of information, advice and broking services in the mortgage protection life insurance and mortgage payment protection insurance markets.
If the Great Australian Dream is to buy one’s own home then ranking behind as the wealth dream is the desire to invest in property. Property investing has become the choice for those aspiring to create wealth for themselves. What could be better than real estate as an investment after all. The question is can I borrow to invest? Am I able to secure an investment loan?
- Investment loans are growing part of the mortgage landscape.
- You don’t need to be wealthy to secure an investment loan.
Who can borrow?
First up, investment loans have gained in popularity since the mid 1990s. Until that time, banks dominated the mortgage market and investment loans were generally considered as available only to high income earners and those with assets such as their own home. When non bank mortgage originators came on the scene (such as Aussie Home Loans and RAMS), a raft of new products and much more competitive mortgages came on the scene too.
Strong economic growth spurred an entire generation of new investors and hence boosted the development of the investment loan. By 2001 more than 25% of all home loans originated were investment loans and the vast majority of these were for people on modest incomes; often without any other assets.
- Investment loans are issued on similar conditions to owner-occupier mortgages.
- Certain conditions do apply such as mortgage insurance where deposit is less than 20%.
Investment loans have certain advantages over owner-occupier loans. Whereas the owner occupier has borrowed to secure their the principal place of residence, the investor buyer of an investment property is interested in the rent from tenants as well as capital appreciation.
Investor advantages
The income from rent can be calculated in the serviceability calculations for the borrower. In other words your income is boosted by the rent received (after allowing for tenancy costs such as rates, management fees etc).
- Investment loans are easier to secure because the rental income can be assessed in the application.
- Investment loans can be secured by fixed rate mortgages which gives the buyer certainty of costs
Investment loans are affordable, and relatively easy to secure. Of course as an investor you need to do your homework and ensure that you seek a suitable investment property. Join the growing pool of investors who want to secure their future!
About the Author
M Kappa is an insider in the mortgage industry that shares his unique knowledge with his subscribers. Find out more about home loans, finance and mortgage broking in Australia at http://www.homeloanexperts.com.au
What happens to my mortgage when I sell my home is a good question. If you’ve decided to sell your home, then you definitely want to know about the money that’s been your responsibility for so long. While you have carried a mortgage since you had your home, now you want to know how selling affects you. This is normal, and has an answer.
For those who have never owned a home, a mortgage is the loan that is taken out against the value of the home. This amount is paid to the homeowner when purchasing. If done correctly, the amount of the note will decrease after you have lived in the home for a certain period of time.
If you’re selling a home and wonder where the balance goes that’s owed on the property, it’s very simple. Whatever financial institution you use will get their money from the proceeds of the sale. This will happen before you realize any profit. It’s absolutely critical that you calculate the amount of the existing loan into the selling price. Be sure you enough to sell after getting your asking price, without still owing on the loan.
Even if you have tons of equity built up in your home, your mortgage can still rob you of your profits on the sale. You can end up paying more than what you thought in the beginning. Today’s financial world has mortgages that have substantial penalties built into them for the purpose of the lending institutions not getting the shaft. They do it very well. They’re put into place to encourage keeping the home for at least a certain amount of time. They lock you in.
These lending institutions have excellent lawyers at their disposal, and they put these penalties into place with a great amount of creativity. There are penalties if you decide to sell within a certain amount of time, or if it falls withing the first two years of the mortgage loan, and it goes on.
They can be a pre-set amount or for a certain amount of payments. It will be disclosed in the fine print of the mortgage. Since these issues are often influenced by state law, you need to read your mortgage documents thoroughly.
About the Author
Denver Homes
Highlands Ranch Homes
Despite the fact that there is a clear cut unpleasant record involved in securing a home mortgage with a bad credit history, there are still some benefit in the whole process. For everything that has a disadvantage, there is always an advantage too to it. Hence, in sourcing for a home mortgage with your bad credit history, you shouldn’t be scared doing so. All you need is to have a working knowledge of how best to go about it. You also need to discover the hidden benefit in sourcing for such a home mortgage.
Here are Some Benefits in Securing a Home Mortgage with a Bad Credit History:
It helps you to spend less
Securing a home mortgage with a bad credit history disciplines your way of spending money. This is because, once you have been granted the loan, you will know that you have to do something to be paying the mortgage as the term stipulates. This therefore will make you stay out of dangerous deals that will soil your credit history the more. Securing the mortgage loan helps you to know that the future has to be taken care of before solving unnecessary immediate issues that needs no serious monetary attention.
It improves your credit report
Securing a home mortgage with your bad credit history goes a long way to helping you improve your credit report system for the better. This is true because once you have engaged yourself in the deal, you are very cautious not to loose the mortgage at the end. This will propel you into the action of making daily and monthly savings in order to pay off the repayment plan. By so doing, your credit report will turn out to be positive. Any serious thinking man who has engaged himself in securing a working home mortgage loan must know that he has to work harder to meet up with the requirements. This generates appropriate focus and eliminates frivolous spending.
It merges all debt into a single entry
Securing a home mortgage with a bad credit history has a way of merging all your debts into one. This is because, in the first place, during the application process, you are required to present all the details of your bad credit history. Once that is done, your lending institution after due consideration grants your request on certain well defined conditions as stipulated in the terms. Along the process of application, all your former debts are merged together to enable you have a bird’s eye view of how much you have left and how to repay all in a systematic way.
In all, the benefits of securing a home mortgage with a bad credit history are not so many like that because a debt is already underway. No matter how you look at it you must have to repay all.
About the Author
Ted Warren is an internet marketer and has been writing and submitting quality articles. To learn more about mortgage loans with bad credit history, visit Yourhomemortgageforbadcredit.com where you’ll find this and much more, including getting a second mortgage.
Is your home in foreclosure? There is a way to correct that problem by doing a loan modification. A loan modification is an effective way of dealing with your foreclosure problem than just simply walking away and losing your home. Because of the continuing downward spiral of the housing market and declining home values, majority of private lenders are viewing loan modification as a more viable and realistic alternative compared to simply allowing their borrowers to foreclose their homes.
These days, banks and lenders are feeling the pressure to modify their loan terms and do everything to keep borrowers in their homes. The program is designed to achieve affordable and sustainable mortgage payments for borrowers and increase the value of distressed mortgages by rehabilitating them into performing loans. A loan modification process also helps lenders, because they know that keeping homeowners in their homes would actually save them more money.
In many cases complex preliminary analysis allows to identify steps and measures to take along with a loan modification in order to improve overall financial health for a customer. The most important factor is to prove that you have the ability to provide payment at a new rate after a mortgage loan modification.
Basically, a loan modification process refers to a new agreement forged between the individual borrower and the lender. The agreement includes modifying the terms and repayment conditions of the current loan, enabling the borrower to afford paying it. For example, a loan modification takes the mortgage you now have and changes the interest rate and payment requirements to fit your criteria, each borrower will have different results.
While these are truly tough financial times. It’s not a hopeless times for borrowers, because there are methods for keeping your home and staying off foreclosure. Loan modifications have helped save many homes from foreclosure and have helped many others achieve more affordable payments.
For a free Special Report on loan modification go to http://www.loanmodification-agent.com
About the Author
A loan modification agent trying to help homeowners stay in their homes.
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