Gabe Burke-Brenn - Mortgage Agent Level 1

Gabe Burke-Brenn - Mortgage Agent Level 1 Providing exceptional mortgage services and advice in the Muskoka area! Mortgage Centre, Brok. #10556

More great news for potential homebuyers and existing homeowners! The Bank of Canada has lowered its target for the over...
07/24/2024

More great news for potential homebuyers and existing homeowners! The Bank of Canada has lowered its target for the overnight rate by 0.25%. This means the policy interest rate will go from 4.75% to 4.5%. As well, the prime rate concurrently drops from 6.95% to 6.7%. Variable rates will feel immediate relief while a reactive bond market could mean that we see fixed rates drop a little over time as well. Look forward to the next rate announcement on September 4th!

The unspoken rules of the mortgage process can be a little confusing for the uninitiated. Many of us have learned a few ...
07/08/2024

The unspoken rules of the mortgage process can be a little confusing for the uninitiated. Many of us have learned a few of these guidelines through the sometimes disastrous process of trial and error, but if you can go in better prepared, you can save yourself a lot of headaches.

The first thing to remember is that change is generally bad! Do not quit your job, buy a new car and open a new line of credit while you are in the process of seeking real estate financing. Save that for the day after closing like a normal person! 😉 Even a seemingly positive change like increasing your monthly contribution to a debt repayment plan will render your current application inaccurate and can detract from your affordability. That's not to say you can't make positive changes and some changes are simply unavoidable. Just ensure that you run this by your mortgage agent or lender so that your application can be updated.

The next thing to know is that you will require the assistance of two professionals to complete your real estate transaction: a real estate lawyer and a home insurance provider. If you have no one in mind, your mortgage agent may be able to refer you to someone.

While lenders often require proof of closing costs to mitigate risk of the financing falling through, it can still be a bit of a mental hurdle to budget for more than your down payment. Legal fees, land transfer tax, home insurance and other expenses all add up and it can be overwhelming if you haven't prepared for this (especially if your new home is requiring a higher cost of living).

Feel free to reach out with any further questions or requests for future topics!

Hope everyone had a great weekend and enjoys the warmer weather today! 🇨🇦
07/01/2024

Hope everyone had a great weekend and enjoys the warmer weather today! 🇨🇦

Big news today in the mortgage and finance world in general as the BoC has dropped the target for the overnight rate fro...
06/05/2024

Big news today in the mortgage and finance world in general as the BoC has dropped the target for the overnight rate from 5% to 4.75%. After the rate hikes and six consecutive holds we are finally starting to see inflation numbers that justify rate reductions. This means variable rates will be dropping and fixed rates should follow suit if a weakening economy remains evident.

Look forward to the next announcement on July 24th. We can only hope that this is the beginning of the slow and steady decline to more reasonable rates by the end of the year!

There are many reasons to work with a mortgage agent! Increasing your affordability, finding you better rates, minimizin...
06/04/2024

There are many reasons to work with a mortgage agent! Increasing your affordability, finding you better rates, minimizing your fees and penalties, offering you a quick and direct line of communication and the list goes on.

A bank employee is limited to that bank's specific rates and products while the mortgage agent can browse what's available at that bank, every other bank, credit unions, trust companies, mortgage finance companies, private lenders and more. Surprisingly, many of these lenders are only accessible through the mortgage brokering channel.

As you may have heard, all of these benefits come at no additional cost to you as a mortgage agent is paid a finder's fee by the lender. So feel free to reach out with your mortgage questions and I would be happy to answer them!

Your timeline, risk tolerance and required cashflow all help dictate what could be the best mortgage type for you. It's ...
05/23/2024

Your timeline, risk tolerance and required cashflow all help dictate what could be the best mortgage type for you. It's also good to remember that a lower contract rate means that you can qualify for more. As well, your first few years of financing are the most interest-heavy as interest is based on your total loan amount. These are just a few of the options available from prime lenders as there are more term lengths and specialized options available. Those struggling to be approved can also look into alternative and private lending options where home ownership becomes more attainable at a higher cost of borrowing.

Establishing a solid credit foundation can be as simple as following the 2/2/2 rule! Possessing 2 credit accounts with a...
05/21/2024

Establishing a solid credit foundation can be as simple as following the 2/2/2 rule! Possessing 2 credit accounts with a $2,000 minimum limit (per account) and keeping them in good standing for 2 years goes a long way with proving creditworthiness to a lender. While there are alternative ways to build credit, this is a great conservative strategy for those who are just beginning their credit journey or are looking to rebuild rapport with creditors. Remember that a stronger credit profile can improve your chances of approval with more lenders and can even improve the rate you qualify for!

The BoC has held its target for the overnight rate yet again. This makes for six holds in a row as they attempt to stifl...
04/10/2024

The BoC has held its target for the overnight rate yet again. This makes for six holds in a row as they attempt to stifle the last remnants of inflation. Variable rates will remain high while fixed rates may only move lower than they are if economic data begins to show that rate cuts could be on the horizon. Right now, we are seeing wages stabilizing, household spending recovering and a high demand for housing as we enter the spring market. Expect the next rate announcement on June 5!

Knowing what you need to put down is one of the first steps to discerning your potential in the current market and what ...
04/09/2024

Knowing what you need to put down is one of the first steps to discerning your potential in the current market and what you will need to save going forward!

You can place 5% down up to $500,000 on an owner-occupied home or second home and every dollar past this amount (up to $1M) will require 10% down. Even a rental that is no more than 2 units follows these rules as long as one of the units is owner-occupied.

Properties that are exclusively rentals or have 3 or more units will require 20% down. As well, any property that crosses the 1 million dollar threshold will require the same.

A property with 5 or more units is considered commercial and will require a commercial mortgage where the down payment can range drastically. Similarly, the up-front cost of vacant land and construction mortgages can vary wildly depending on the land type and the projected building cost.

For a final word of advice, mortgages that are under 20% down will require default insurance to protect the lender. The percentage cost of the insurance changes depending on what you put down. 5% down will typically mean a 4% premium on the loan amount while 15% costs you about 2.8%. This cost is partially offset by insured mortgage rates being lower, but if you have 20% down it is always cheaper to take the higher rate and avoid the default insurance.

Remember to consider your cashflow, market fluctuations and possible equity growth when choosing your down payment amount!

There are many costs to consider outside of your down payment and eventual mortgage payment. It is recommended that you ...
03/08/2024

There are many costs to consider outside of your down payment and eventual mortgage payment. It is recommended that you have an additional 1.5-3% of the purchase price on hand for conventional closing costs. As well, it can always be good to factor in moving costs, furniture and early renovations/maintenance costs!

With Canada's inflation rate still close to that 3% level, the Bank of Canada is adamant that there is still work yet to...
03/06/2024

With Canada's inflation rate still close to that 3% level, the Bank of Canada is adamant that there is still work yet to be done and that inflationary pressures remain high. No key interest rate change means variable rates will remain relatively high while fixed rates will also stay at their slightly lower levels while the market is still in limbo over the inflation situation.

It is important to know that the majority of mortgage lenders have a list of criteria that can impact your interest rate...
02/16/2024

It is important to know that the majority of mortgage lenders have a list of criteria that can impact your interest rate. Read on to find out more!

Your down payment amount decides the loan-to-value (LTV) ratio of your mortgage. While a higher down payment can lead to a lower interest rate because there is less risk to the lender, a high-ratio mortgage (less than 20% down) will often have the best rates available since these mortgages are required to be insured. While this insurance greatly reduces the risk to the lender, it is important to know that its cost does offset the benefit of the lower rate you are receiving.

We all know that fixed and variable rates have their differences. Fixed rates are currently lower as variable are more closely tied to the Bank of Canada's overnight rate. As well, lower terms (i.e. a 3-year term vs. a 5-year term) are more expensive right now since they allow you the flexibility to change rates sooner in the case that rates drop. The opposite was true when rates were lower in 2020 and 2021. In other words, the premium you pay on your term length is directly tied to market sentiment regarding rate direction.

As for credit, a score of 680 and up will often mean a better rate while a score below 620 is viewed less favourably and often nets you a lower rate. There are many ways to improve your score without financially disrupting your life so keep that in mind if you fall into the latter category!

A lesser known fact is that there are many mortgage providers who favour urban and suburban properties over rural. This is because the marketability of your property is a factor in determining the risk to the lender. Rural areas are often deemed to be less desirable, and this can result in reduced growth potential and saleability. As such, rural properties may prompt higher interest rates and will even reduce the pool of lenders that will offer you financing.

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