Saturday, September 13, 2014

The worst home renovation traps to avoid

Which reno projects reap the richest rewards (and what does your neighbor's home have to do with it)?

 You've just finished renovating your home from top to bottom. That means attic, basement, and every square inch of living space in between.
Okay, so your place now looks like the Palace of Versailles - but you also had about as much work done to it as the Queen did Buckingham Palace (and that little project just about bankrupt her!).
Sure, some of those expenses may well pay for themselves come resale time, but not all. You knew that - and that’s why you shied away from the skylight installation, the pool, and the new asphalt driveway. 
But there’s more to it than that.

Fixer-upper fixations

The Appraisal Institute of Canada compiles a report each year based on findings from a survey of its members to determine which reno projects offer the highest return on investment
Perhaps the most significant findings from the survey are: 
  • The expense you put forth for the project must be relative to the price of your home (for instance, a $30,000 improvement doesn’t belong in a $100,000 property).
     
  • The projects you undertake mustn't separate the home from other homes in the neighborhood too drastically.
     
  • You’ll recover a higher return from renovations if the value of your home is below the neighborhood average; those same renovations will yield significantly less if the value of your home exceeds the average.
     
  • The smartest improvements reside in a kitchen update worthy of the Duchess of Cambridge, a remodeled bathroom, and an interior paint job. These upgrades are the only ones that could potentially pay entirely for themselves. That roof replacement and new furnace or heating system might encourage up to 80 percent in recovered funds. Doors, windows, and a new deck may fetch back 75 percent.
     
  • But your wood fence, interlocking paving stones (cute - but not all that investment-smart), and unnecessary landscaping costs (a bush shaped like a deer - really?), could end up setting you back 75 percent in unrecovered costs. 
These findings might be of particular note if you’re planning to spend an average of $21,000 or more on your home in the year following the purchase of your house - and many Canadians do, according to data by Canada Mortgage and Housing Corporation.
Why so much? One possible reason: Home renovations are in vogue. Of course, all you’d have to do is take one glance at television programming these days to arrive at that conclusion.

Where there’s smoke...

A recent Maclean's article that highlights the "dark side" of home renovations certainly supports the observation that home renovations are sweeping the nation in ever-growing numbers. 
Shows like Property BrothersLove it or List it, and Holmes on Homes are just a few that provide evidence of the growing trend: Home renovations have climbed 7 percent every single year since 2003. Roughly half that growth might be due to a “white-hot housing market,” according to Maclean’s. Economists have even given it its own name: the Wealth Effect.
For every $1 increase in wealth a homeowner makes due to real estate appreciation, notes TD, the homeowner doles out a nickel on home improvements. A Houzz survey further found that where just 14 percent of Canadians said they would take out a line of credit to finance their home renovation costs in 2013, a whopping 34 percent said the same a year later.
Okay, we get it - home remodeling is the new black. Still, don't get sucked into a black hole of debt over it.

One final tip

Keep your eyes on the prize and don’t get too consumed with the idea of transforming your home from top to bottom. Take it one project at a time and always keep the cost-to-value ratio in mind. Follow that advice and you’ll have both your palace and your bankbook looking tip-top in no time.
brampton homes for sale, toronto homes for sale, bolton homes for sale. www.bramptonTorontoHomes.com 

Friday, September 12, 2014

Do your research and avoid painful surprises

There’s little hope of changing your offer once it’s accepted.

When buying or selling a home, the importance of doing your research before making decisions is critical. Understanding what you want, and what you can expect during the purchase or sale process, means fewer headaches when you go to close the deal — and no unfortunate surprises after you have signed on the dotted line.
Spend time doing your homework to know what you want, and what to expect from the market and also from your real estate representative, when buying or selling a home.
Here are two situations that highlight the need to be informed:
I forgot to include a condition in my offer to buy a home. Can I add it after my offer has been accepted?
Any offer that has been accepted is considered a binding contract. Therefore, you cannot add or alter the terms or conditions after an offer has been accepted — unless the other party consents to these changes. This would typically be done through the use of an amendment form.
However, you should know that the seller may not consent to new conditions, especially if they conflict with their plans or are in any way detrimental to them.
That’s why it’s important to do your due diligence in advance. Talk to your registered real estate professional and make sure you include all of the conditions that are important to you in the offer you submit.
Client vs customer: What is the difference and why does it matter when you’re buying or selling a home?
Buyers and sellers may enter into one of two types of agreements with a brokerage: a representation agreement for clients, or a customer service agreement. Both are considered legally binding.
There are two big differences between the brokerage’s obligations to a client versus a customer.
If you are a client, the brokerage has an important obligation to you called fiduciary duty, and must promote and protect your best interests in the real estate transaction. If you are a customer, the brokerage does not have that obligation, but must treat you with fairness, honesty and integrity, and provide you with conscientious and competent service.
If you are a client looking to purchase a property, under a legislated code of ethics, the salesperson must take reasonable steps to determine, and then disclose to you, all material facts about the property.
If you are a customer, however, the salesperson only has to disclose to you the material facts that he or she already knows or ought to know, and they are not required to take any further steps.
There are a couple of other points to consider when deciding whether to become a client or a customer of a brokerage, especially if you are a seller.
A real estate agent must convey all written offers to a seller who is their client — unless otherwise specified in writing. A salesperson working with you as a customer, however, is not obliged to convey offers to you — unless your agreement provides for the brokerage to receive written offers on your behalf. In that situation, the buyer’s representative would have to contact you directly.
With all of these points in mind, your decision boils down to a basic question when considering the client versus customer relationship: What are my needs and which relationship best meets them?
If you have knowledge and a comfort level with buying and selling real estate, then perhaps the customer relationship is sufficient for your needs. If your knowledge and experience is limited, then the client relationship is likely your better option.
But one important factor remains the same for both clients and customers: No matter what you decide, remember to do your homework in advance.
Before you sign your agreement with the brokerage, make sure you know what you want, the services you expect to receive. For sellers, this could include staging, open houses, advertising and a marketing plan. For buyers, this could include must-have features, potential deal breakers, amenities and geographic considerations.
In both cases, make sure that it’s clear who will be paying for these additional services.
Be informed. Determine what you want and what you need. Understand your rights and obligations under your relationship with the sales representative.
If you prepare well in advance, this will help ensure there are no surprises during the buying or selling process.

Joseph Richer is registrar of the Real Estate Council of Ontario (RECO). He oversees and enforces all rules governing real estate professionals in Ontario.  on YouTube at http://www.youtube.com/RECOhelps .

Thursday, September 11, 2014

Why 20% of Households Are Throwing Away $11,500

About 20 percent of households who would benefit from refinancing are not doing it — and they could be losing out on lessening their mortgage payments by thousands of dollars over the life of the loan, according to a new report from the National Bureau of Economic Research.

"Despite the large stakes, anecdotal evidence suggests that many households may fail to refinance when they otherwise should," according to the report. "Failing to refinance is puzzling due to the large financial incentives involved."In analyzing a large random sample of outstanding mortgages from December 2010, researchers found that the median household could save $160 per month over the remaining life of the loan, amounting to a total savings of about $11,500.
The report found that borrowers may fail to refinance because they are unable to calculate the full financial benefit to them, they fail to see the benefits over time, or the high amount of upfront costs may deter them.
"Our results suggest the presence of information barriers regarding the potential benefits and costs of refinancing," according to the NBER report. "Expanding and developing partnerships with certified housing counseling agencies to offer more targeted and in-depth workshops and counseling surrounding the refinancing decision is a potential direction for policy to alleviate these barriers for the population most in need of financial education."

Tuesday, August 26, 2014

Landscaping & Tree Trimming

Planting new trees and shrubsExisting trees

It’s important for homeowners to ensure trees and other plants don’t grow too close to powerlines and other electrical equipment. Here’s why:
  • Tree limbs that come down during a storm or high winds can bring powerlines with them causing a power outage and leave live powerlines on the ground which is a severe safety hazard.
  • Tree branches that touch powerlines can also cause a fire and create an electric shock hazard if someone touches the tree.
If you have trees that are growing too close to powerlines, contact a trained arborist or your local electric utility to have the tree safely trimmed.

If you’re planting new trees on your property, make sure to plant them far enough away from the powerlines so even when your sapling is a mature tree, it doesn’t come too close. Follow ESA’s tree planting guide for suggestions on species that are appropriate to plant near powerlines.
Thinking about planting shrubs around that green box on your property? Remember, this box – called a padmount transformer -- contains electrical equipment that runs underground. Never dig near one, and don’t plant shrubs or plants within 1 metre of the box. This will make it difficult for utility personnel to find and access the box if there’s a power outage.

Monday, August 25, 2014

10 Tips for New Home Buyers

#1. Choose the type of home that meets your lifestyle needs aerial view of subdivision

Do you like being close to downtown, or would you prefer living outside the city? Do you like the prospect of maintaining a garden? Where do you want your children to attend school? These are lifestyle decisions that play a large role in the new home buying process.

You also have more design choices than ever before. Would you like a 'smart' home that's pre-wired
for your media and entertainment needs, or a gourmet kitchen for entertaining? Or both?

There are two major types of new homes available to you - freehold and condominium - and each has different construction timelines and warranty coverage.

To find out more about new developments that may suit your needs, read the home sections in major newspapers as well as real estate websites such as www.homesmag.com and www.condolifemag.com. Check out Twitter for the latest builder and industry news.

#2. Determine what you can afford

Once you've chosen the location and type of new home that fits your needs, meet with a financial representative to determine a mortgage amount that you can comfortably afford. This will help you understand the types of homes that fit into your price range. You should also consider getting a pre-approved mortgage, in order to shop with added confidence.

For more information on new home financing, visit the Canadian Bankers Association at www.cba.ca or call them (toll-free)
at 1-800-263-0231.

man using laptop#3. Research your builder

Talk to homeowners in the neighbourhood(s) you're interested in. Find out if they were satisfied with their builder.

Look up any builder you're considering in the Ontario Builder Directory section to ensure they are registered with Tarion. You'll learn how many homes they have built in the last 10 years, and whether they have had any claims with us over this period.

#4. Talk with a real estate lawyer.

Before you sign your Agreement of Purchase and Sale, or Contract for a Custom Home, have it reviewed by a qualified real estate lawyer. There are other issues for you to consider, which are explained in the Making the Deal section of our website.

#5. Prepare for your Pre-Delivery Inspection (PDI)

The Pre-Delivery Inspection is probably the first time you'll visit your new home in its completed state - and it's your primary opportunity to learn how to operate and maintain your new home as well as to ensure that everything has been built according to your purchase agreement.
 
To help you prepare for this important stage of the home buying process, you may want to read Getting Ready for the Pre-Delivery Inspection or print a copy of our comprehensive PDI Checklist.

#6. Read the Tarion Homeowner Information Package

The Homeowner Information Package should be given to you by your builder before or during your Pre-Delivery Inspection. It outlines your new home's statutory warranty, the responsibilities of both you and your builder, and how Tarion will handle a warranty claim.
 
Whether you purchase a freehold home or a condominium, we encourage you to read this document in its entirety - and we recommend that you file it with your other new home documents so that you can refer to it in the future.

#7. Visit our Online Video Library

Our Online Video Library has a wide range of educational videos designed to help new home buyers learn about statutory warranty coverage and how to make a claim.

#8. Complete and submit any required Statutory Warranty Forms on time

Even though most builders will do everything they can to ensure your home is ready when you move in, sometimes items are missing or not working properly.

To help you better understand what is and isn't covered under the statutory warranty, we encourage you to review the Construction Performance Guidelines prior to submitting a Statutory Warranty Form. Additionally, if you believe that there are items missing from your home, we recommend that you refer to your PDI Form or your Agreement of Purchase and Sale to confirm this before you submit a Statutory Warranty Form. To get an item resolved, you should contact your builder and follow our statutory warranty process.

#9. Maintain your home

You've made a big investment in your home, so you should take care of it all year round. It's important to remember that the ongoing maintenance of your new home helps to ensure that your statutory warranty rights are protected.
 
We've created a maintenance guide that addresses common questions and provides tips on how to look after your new home through all four seasons.

family outside of their home#10. Enjoy all your new home has to offer!

You've done a lot of research, decision making and waiting by the time you reach this point.
 
Now it's time to enjoy your new home!
- See more at: http://www.tarion.com/New-Home-Buyers/Pages/Top-Ten-Tips-For-New-Home-Buyers.aspx#sthash.dupou3ZP.dpuf

Sunday, August 24, 2014

70% in their 20s don’t consider a mortgage a debt: Survey

While most Canadians want to be debt free, those carrying mortgages feel more comfortable owing money than previous generations.

Most Canadians say they want to be debt free, but those carrying mortgages feel more comfortable owing money than previous generations.
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Most Canadians say they want to be debt free, but those carrying mortgages feel more comfortable owing money than previous generations.
While most Canadians want to be debt free, those carrying mortgages feel more comfortable owing money than previous generations, according to a survey.
But that may have something to do with how they define being debt-free, which varies by age, the survey by Manulife Bank of Canada found.
Nearly 70 per cent of respondents in their 20s said they could have an outstanding mortgage and still be debt free, compared to just 29 per cent of respondents in their 50s.
The survey also found that nearly 40 per cent of home owners feel more comfortable with debt than their parents with the views differing by generation. Those in their 50s were five times as likely as those in their 20s to feel more comfortable with debt than their parents.
Even so, the results are encouraging says Jason Daly, vice president of products and marketing for Manulife Bank.
“It seems that Canadians are feeling fairly good about where they’re at, relative to their parents,” he said.
The average Canadian owes about $1.63 for every dollar they earn in disposable income, according to Statistics Canada. But 51 per cent of home owners in the Manulife survey said they were in good or great shape in terms of becoming debt-free.
Low interest rates have lowered the sense of urgency about borrowing, Daly said.
“A low interest rate environment makes debt a little less intimidating, a little bit more manageable,” he said, noting that the results may have been different if interest rates were higher.
Having open conversations about debt also helps increase comfort levels, Daly said. Only 28 per cent of respondents in the survey said they were more likely to talk about debt with their spouse or partner than their parents were. That number fell to just 15 per cent among respondents in their 20s.
Conversations about debt seem to have a positive impact. Home owners who said their parents taught them a lot about debt management were twice as likely to say their debt was in good or great shape.
Schools, too, are beginning to recognize the importance of financial literacy, Daly said.
“These are all good things that are going to help the consumer over time,” he said.
Still, having a debt management plan is key, Daly said.
“It’s really critical, managing your cash flow, trying to get a debt management plan in place. And a financial manager is a great asset to getting your financial goals in place and looking at your financial plan holistically,” he said.
Debt freedom
A survey of 2,400 people asked them to describe their progress toward debt freedom.
  • 35% said they're doing okay
  • 29% said they're in good shape
  • 22% said they're in great shape
  • 11% said they're in poor shape
  • 3% said they're in very poor shape
  • 1% said becoming debt free is not on their radar
  • Source: Manulife Bank

    Saturday, August 23, 2014

    The ultimate mortgage checklist: How to get the best possible deal

    DECODING THE MORTGAGE MARKET:-ROBERT MCLISTER  Special to The Globe and Mail

    The lowest possible rate is how many define a good mortgage. But that’s like judging the “best car” by the one with the lowest monthly payment.
    Anyone who’s had to cough up a mortgage penalty or deal with refinance limitations can vouch for one thing: Mortgage restrictions can easily outweigh small (e.g., 0.10 to 0.15 percentage point) differences in interest rates.
    It’s tough to predict your refinance needs three or four years out. Statistics show that well over half of Canadians with a mortgage renegotiate before their term is up. And the average five-year borrower changes their mortgage every three-and-a-half years.
    That’s why it often pays to trade a slightly lower rate for more flexibility, unless you know you won’t change your mortgage during its term. A cheap rate can certainly save hundreds of dollars up front. Just be sure it doesn’t cost thousands after closing.
    On that note, here’s a list of questions to ask your mortgage expert of choice. Check the boxes one by one as you talk with your adviser. With a little effort, this list will help you snare the most feature-rich mortgage possible, at a rate that’s better than average.
    The Rate
    1. Is the rate you're quoting me the lowest I can possibly get, given my qualifications and mortgage preferences?
    2. If I find a lower rate for a similar product elsewhere, will you match it?
    3. How many other lenders did you check when shopping around my mortgage? Which major banks and credit unions did you not check?
    • These questions apply to brokers because bankers and credit union reps generally don't shop around for you.
    • RateSpy.com is a tool I created to help mortgage shoppers benchmark the competitiveness of their rate. If you're within 0.10 per cent to 0.15 per cent of the lowest rates on this site (for the term you've selected), you're in good shape. Just be sure to compare apples to apples because the cheapest rates are often for no frills mortgages with potentially costly restrictions.
    4. How long will the lender hold my rate, once I apply?
    • The best rates often come with only 30-45 day rate hold periods (aka. "quick close rates").
    5. If I get approved and rates drop, how will I know? Will the lender automatically adjust my rate lower? Will I get the lender's very best promotional rates if its rates fall?
    6. Can I get a pre-approval at this rate?
    • Pre-approvals often come with rate premiums.
    7. Do you offer fully discounted rates up front at renewal? Or do you send me an inflated rate in a renewal letter and hope I sign it?
     Extra Payments
    8. How much extra can I prepay each year without penalty?
    • Standard "closed" mortgages offer annual "lump-sum" prepayment options ranging from 10 to 30 per cent of the original mortgage amount.
    • Don't pay for more prepayments than you need (only 18 per cent of Canadians use lump-sum prepayments in any given year). But, just as importantly, don't underestimate the prepayment options you'll need. Prepayment flexibility can help you reduce a mortgage penalty, or it can save you interest in the event of a cash windfall.
    9. When can I make these prepayments?
    The best lenders allow you to make prepayments any time during the year, in multiple instalments.
    10. How much can I increase my ongoing payments each year?
    Most mortgages let you increase your ongoing payments by 15 to 20 per cent each year. Some go up to 100 per cent and/or offer double-up payments.
    11. What payment frequencies do you have?
    • Examples include monthly, bi-weekly, weekly, and semi-monthly.
    • Accelerated payments (like "accelerated bi-weekly") are the equivalent of making one extra monthly payment per year. RBC Mortgage Specialist Jennifer Bissonnette notes: "A 25 year amortization can be reduced to 22 years simply choosing accelerated bi-weekly payments instead of monthly." Being mortgage-free three years sooner will cost you just $59 more every two weeks, she adds. That's on a $300,000 mortgage at 3.69 per cent with a 25-year amortization.
    Penalties
    12. Can I break my mortgage any time I want?
    • Most lenders let you pay a penalty and get out of a closed mortgage early. Some no-frills lenders only let you out if you sell your property. Some don't let you discharge your mortgage at all, until the term is up.
    • You'll almost always pay a rate premium for an "open" mortgage with no penalties. If you plan to keep the mortgage for more than six months, you're often better off choosing a lower rate and paying the penalty to get out early (if needed).
    13. If a mortgage penalty applies, how do you calculate it?
    • Fixed rate penalties are usually three months of interest or theinterest rate differential (IRD), whichever is more. Variable-rate penalties are typically three months of interest based on your current rate.
    • Penalty calculations based on posted rates (i.e. rates higher than the rate you actually pay) can sometimes be several thousand dollars more expensive. This method is common at most large banks, and is their single greatest weakness. If you want to compare penalties, try some sample calculations using each lender's online penalty calculator.
    • Some lenders get tricky. For example, instead of a standard three-month interest penalty based on your current rate, some lenders charge three-month interest penalties based on posted rates. Others charge interest rate differential penalties when three-month interest charges normally apply. A few even ding you with 12-month interest penalties or penalties equal to three per cent of your balance. Avoid such mortgages unless the rate savings is significant.
    14. Can I port my mortgage to a new property to avoid penalties?
    • Don't underestimate your odds of moving. Look for good porting flexibility, especially if you're young, need job mobility and/or have a growing family.
    • Some lenders let you port, but not increase. That forces you to pay a penalty if you buy a pricier house and need more financing.
    • Note that credit unions typically prevent porting across provincial lines–a problem if you move out of province.
    • If you have a line of credit attached to your mortgage, make sure you can easily port it as well and keep your rate.
    15. How long do you give me to port my mortgage?
    • The longer the better. At least 60 days is preferable. Some lenders make you close your old property and new property on the same day, which can be unrealistic.
    16. Do you deduct interest from my penalty rebate if I port my mortgage and my old and new house don't close on the same day?
    17. If I break the mortgage early, can I use my unused prepayment privileges to lower the penalty?
    • Some lenders restrict you from using your prepayment options for this purpose, if you do so within 30 days of discharging the mortgage. Some lenders, like RBC, automatically apply unused prepayment privileges to lower your penalty when refinancing–a cost-saving feature.
    18. If the mortgage includes cash back, how much of that cash do I have to repay if I break the mortgage early?
    • Usually it's a pro-rated amount but some lenders make you repay 100 per cent of the cash back, even if you break the mortgage one day early.
    • Have your mortgage adviser calculate your "effective rate," including the cash back. That tells you how much of a rate premium you're paying for the cash.
    Refinancing
    19. Is there any restriction on when I can refinance?
    20. Can I increase my mortgage at any time, at fully discounted rates, and without paying any penalty?
    • This is vital if you need to refinance or buy a more expensive home.
    • Some lenders have a policy of charging penalties, or not giving you the best rates when you increase your mortgage.
    21. Can I extend my mortgage term at any time without penalty, and at fully discounted rates?
    • This is useful if rates drop and you want to blend your rate with the new lower rate (which lowers your payment). It's also key if you're past the middle of your term and you want to mitigate the risk of higher rates at renewal.
    • Beware of lenders that let you "blend and extend" but then bake a prepayment charge into your new mortgage rate.
    22. Is your mortgage readvanceable?
    • Readvanceable mortgages let people with at least 20 per cent equity re-borrow principal that they've previously paid off. This feature usually involves a credit line linked to your mortgage. Readvanceables are good low-cost sources of funds for investment opportunities, a small business, renovations and so on. Readvanceables also let you pre-pay your mortgage without the fear of not having cash on hand in an emergency. Some people even use them as an alternative to a contingency fund.
    • There are two types of readvanceables: manual (where you must apply to re-borrow paid-down principal) or automatic (where every principal payment is instantly available to you if you need it).
    23. Can I roll in my refinance or switch costs to the new mortgage?
    Variable-rate Mortgages
    24. Does your variable rate mortgage have any restrictions?
    • Some variable-rate mortgages prevent you from porting or blending your rate, prevent increases and have fewer prepayment privileges.
    25. Can I fix my payment so that it doesn't move if rates increase?
    • If so, and rates rise, more of your payment goes to interest. If rates fall, less of your payment goes to interest. Note that most fixed payment variable mortgages have "trigger rates." If prime rate increases so much that it exceeds the trigger rate, the lender will boost your "fixed payment."
    26. How fast does the lender increase rates when prime rate rises?
    • Some lenders, like ING, adjust their variable rates every three months, which keeps your rate lower longer. (This delay works against you if rates drop)
    • A few lenders offer capped-rate variables with a ceiling on how high your rate can go. These are usually a bad deal if you do the math.
    27. Can I convert my variable rate to any of the lender's fixed rates, at any time?
    • Remember, you'll rarely get the best fixed rate when you convert. Moreover, it's impossible to successfully time interest rates over the long run. For those reasons, do not go variable to save money in the short run, hoping to lock in "at the right time." Variables are a long-term strategy.
    28. If I convert my variable rate to a fixed rate, will I get the absolute lowest rate the lender offers for that term?
    • Typically you won't. Lenders know you'd have to break your mortgage and pay a penalty. Most use that as leverage to offer merely average rates on conversions.
    Other Features
    29. Can I split the mortgage into different parts?
    • "Hybrid mortgages," as they're called, let you lock part of your mortgage into a fixed rate, or various fixed rate components, while the other parts may float at a variable rate. The purpose is to diversify your rate risk.
    • If you pick a mortgage with both long and short terms, remember that the lender may not offer you the best rates on the renewal of your shorter term. It knows you'd have to pay a penalty to get out of your longer term, making you less rate sensitive.
    30. Can you offer the amortization I want?
    • Some lenders have minimum amortizations (like 18 years) while a handful of others still offer amortizations up to 35 years (assuming you have 20 per cent-plus equity).
    31. Does the lender let me check my balance and remaining amortization online? Make prepayments online?
    • Major banks and large non-bank lenders (like First National, Street Capital and the big credit unions) usually have the best online access.
    32. Is the lender a bank or credit union with branches?
    • Nowadays you can fully service your mortgage online or by phone, but some people still like a branch presence.
    • Almost all lenders link to your chequing account to automatically withdraw mortgage payments and make prepayments. So it's no longer inconvenient to separate your mortgage and banking.
    • There are over 300 mortgage lenders in Canada. Don't fear small lenders that you've never heard of.
    33. Do you offer early renewals at your best discounted rates with no fees or penalties?
    • A 120 to 180 day early renewal can potentially reduce your rate risk. But beware of lenders that try to create false urgency and lock you into a "limited time" offer well before your renewal date.
    34. Do you offer an all-in-one style mortgage where I can combine chequing, savings and my mortgage into one account?
    • Doing this can save interest as your spare cash lowers your mortgage balance, thus reducing the amount used to calculate your interest.
    35. If I sell my house, can the buyer assume my mortgage?
    36. If I get a one-year fixed, can it be converted to any of the lender's fixed rates, at any time?
    • Only a handful of lenders offer this option, which gives you variable-rate type features without committing to a long term.
    37. Can I skip a payment if needed? If so, how often and under what circumstances?
    • "Payment vacations" can be handy in emergencies. But some lenders require that you make an equivalent pre-payment first. Remember that skipped payments aren't free. You still have to make all payments eventually, and interest accrues in the meantime.
    38. Do you pay profit sharing on my mortgage?
    • Available only at credit unions who rebate a small portion of your interest paid. You can access these funds only after a vesting period, which can last 3-7 years or more.
    39. What default insurer will insure my mortgage?
    • Default insurance generally applies if you have less than 20 per cent equity. When you switch lenders with an insured mortgage, you must ensure that the new lender accepts that insurer's mortgages. CMHC and Genworth allow you the most flexibility when switching lenders.
    40. If I purchase creditor life insurance through you, can I port that insurance to a new lender without having to requalify and lose the premium I'm paying on my current mortgage amount?
    • Insurance premiums go up as you age, so you want insurance that's not tied to one lender. That way, you can keep your premiums as-is on your original mortgage amount, even if you change lenders.
    • If you don't have portable creditor life insurance and get sick, your pre-existing condition may not be covered by the new lender's insurer.
    Extra Costs
    41. Will you pay my appraisal fee?
    • Appraisal fees are usually $225 to $325, but can be significantly more based on location and property-type. There is usually no appraisal cost if your mortgage is insured.
    42. Do you have any processing fees?
    43. Do you have any cancellation fees?
    44. How is the mortgage compounded?
    • Semi-annual compounding costs you less than monthly compounding.
    45. Do you charge "reinvestment fees" on top of the penalty if I break my mortgage early?
    46. Do I have to pay legal (aka. mortgage registration) fees?
    • Most lenders cover this cost on switches where the loan amount, loan-to-value and amortization are not increasing.
    • A few even pay legal fees on refinances, but the rate is often higher than you can get elsewhere.
    47. Is the mortgage a "collateral charge" mortgage?
    • Collateral charges help you avoid paying legal fees to refinance with your lender. But they also make it potentially more expensive to switch institutions at maturity. The reason: most lenders only pay switch fees on "standard charges," not collateral charges.
    • Some collateral charge lenders register your mortgage for 100 to 125 per cent of your property value. That lets you borrow more if your property value rises. The tradeoff: It prevents you from securing anything else against your property, like a second mortgage.
    48. If I switch my mortgage to you, will you pay my old lender's discharge fee?
    • Very few lenders do this, but it can't hurt to ask.
    49. Do I have to pay title insurance if I switch my mortgage to you?
    • The answer is commonly yes, but some lenders don't require title insurance, or they will pay it for you. It can be $150 to $300 or more.
    50. Will I pay a higher rate if I'm self-employed and cannot prove my income in the traditional manner?
    51. Does the mortgage come with free banking or significant discounts on other financial products?
    • Unlike days gone by, you no longer need to bundle financial products to get the market's best mortgage rates. Nor do you need a "special relationship" with your banker. Simply shopping around and negotiating will get you the same mortgage discounts 99 per cent of the time.
    52. If I switch lenders and have a mortgage and line of credit, will the lender charge me a separate discharge fee on both the mortgage and line of credit?
    53. If I need bridge financing to cover the gap between the purchase of my new home and the sale of my old home, what rate and fees will you charge?
    • Also ask how long the bridge lasts. 30 days is typical.
    54. Will I pay an extra fee if I break my open mortgage within 12 months?
     Service
    55. If I have a problem with my mortgage, who do I call?
    • Large mortgage providers like banks often have live chat or 24-hour telephone support, all tracked and recorded in case you have a problem later.
    • Large lenders also have systems that enable multiple agents to work on your file. This yields faster service if your main contact is unavailable.
    56. Will I get a dedicated mortgage adviser, or talk to someone different each time I have a mortgage question?
    • You should always have the email address and direct number of your primary mortgage contact.
    57. How long do I have to wait on hold to speak to my mortgage adviser? What are his/her hours?
    58. Will my mortgage adviser contact me annually for a mortgage check-up?
    • This service ensures that your rate is still competitive and that your mortgage type still makes sense for your changing needs.

    Advice
    59. What are your qualifications as a mortgage adviser?
    • How long have you been a mortgage adviser? (The more experience, the less chance for costly mistakes. Look for two years minimum experience.)
    • Do you specialize in mortgages or are you a generalist who sells many financial products but is a master of none?
    • Have you closed over $10-million of financing in the last 12 months? (That's a minimum rule of thumb for professional mortgage advisers.)
    • Are you the right mortgage adviser for me? (Read this)
    60. Given my lifestyle and savings, will you be honest with me about whether I can truly afford this mortgage?
    • Just because a lender approves you doesn't mean you can safely afford the payments. Moreover, alternative down payment options may not be worth the trade-offs.
    61. What methods will you use to help me pick the right term?
    • Proper term selection saves you way more than small rate differences, almost every time. Find an adviser that does more than glibly quote industry research or ask if you can "sleep at night" with a variable rate. At a minimum, your adviser should compare the estimated interest cost of various terms, given sample rate increases over the next five years.
    62. Will you help me stress test my mortgage?
    • Be sure you can afford your mortgage if rates jump 2 to 3 per cent.
    63. What mortgage strategies will you provide to help me retire faster?
    • Your mortgage can be used as a key financial planning tool to accelerate your savings, create future equity and build your investment portfolio.
    Note: This checklist assumes you're a qualified borrower who's getting a mortgage on his/her primary residence, with provable income and decent credit. If this doesn't reflect your scenario, other important questions will apply.