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Answer Upon - Canadian Mortgage Report
When dealing with decisions using Cost Benefit techniques it is very important to follow the proven principles. The health of your company and your reputation depend on it. If these rules are not followed then your decisions could be flawed.Let's start, shall we?Mistake #1. Not exploring all options.It is human nature to want to think about the problem quickly, make a decision (instead of looking for the best decision) as soon as possible and move on.There are many tools available to assist in thinking creatively to ensure all possible options are canvassed PRIOR to the decision being made.For Example: If a decision is to be made regarding the company's business systems, close study would need to be given to ensure all feasible software providers were involved. Not only would you need to look at software providers but also hardware sources and bureau services. Also, will the future direction of the business mean that simply replacing “like with like” be suitable? Also is the ”do nothing” option viable?Mistake #2. Not assessing the options correctly.If you deal with Mistake #1 and generate many options, how are you going to know which options are worth pursuing? You need a recognised, tested and proven method to assess these options so that the best ones can be chosen for imp
Most mortgages fall into two classes Prime ( strong borrower with a high beacon score) and Sub-prime ( weaker borrower with a lower beacon score) Note: Every borrower has a beacon score which is utilized to determine their credit worthiness. Credit agencies such as Equifax and Trans Union use a complicated formula based on your credit history that determines your ability to pay two years down the road to assign your personal beacon score usually ranging from a low of 400 to a high of 800. Between 600 and 800 is prime and anything less normally sub prime. It is very important to maintain a good beacon score to access credit at a reasonable interest rate. The interest rate you are charged is mostly determined by your beacon score. Right now we can get a prime borrower 5.019 %. A sub-prime borrower would pay between 9% and 12%. To give you an example the prime borrower would pay around $500 per month PI (principle and interest) on a $100,000 mortgage over 25 years. Sub-p
Many musicians complain about the lack of gigs they have, but when I ask them to look closely at the type of venue they are searching, the repeated pattern seems to be clubs, stadiums, concert halls and pubs. What I would like to share here is to keep a real look out and be totally aware of the possible gig locations and don’t limit yourself. How about restaurants, parks, malls or my favourite, the local coffee shops?Coffee shops are the next link in the chain of great gigs. Depending on the venue, you can drop in several times and build links with staff and get a feel for the type of customers that come there. Make it your second residence!Depending on the type of music, coffee shops represent the perfect venue for musicians to meet with their perfect audience, and if they are your right audience, what must your audiences be doing if they’re not watching you? Drinking coffeeCoffee shops are great place for people who want a break from both work and home. It’s like the middle space, or the third space. I personally like these places because it’s nice and cosy, allowing you to build deeper relationships with the crowds.Something that works day in, day out is the power of repetition. If people see your name several times, they remember it, and create a link in their mind. By placing severa
Here is another example. A friend called for advice. A local company had approached him about a valuable surface mineral they had discovered on his property that they wanted to purchase from him by the ton. (so much per ton).I advised him that was outside my area of expertise and he should consult with a mining engineer or geologist who would know the current market value. He said he would do that. Some months later I asked him how he had made out and if he had checked with a professional. He said no and that the company had made him an offer and he had countered back double the price they offered and they had agreed to pay his price and he had signed a contract to that effect. I advised him that I had heard that the company had also made a deal with a large timber company on the adjacent property and he should check with them to see what they were getting. Several days later he called me back very upset. The timber company was getting 5 times the amount he was getting. I advised him to consult a lawyer. This time he took my advice. After a 10 year legal battle he did receive a settlement but why didn’t he take my advice the first time ? I’ll tell you why ! He thought he knew. I have to tell you this fact. Most of my customers think they know more than me and in many areas they do but not when it comes to real estate and mortgages,( in most cases they don’t) but human nature makes it very hard to trust someone else’s opinion especially someone who is looking to make a dollar off you. Penny wise and dollar foolish. Probably but understandable because most of us are this way, myself included.
We all in most cases would rather make our own mistakes than feel taken advantage of by some professional we don’t know or trust. That is why some one listing their house will always list with a friend over an experienced realtor because trust is more important than experience in the minds and hearts of consumers even though in the long run it may cost them dearly.
In this report my goal is to give you information. How you use it will be up to you. My goal is to gain your trust so you will not hesitate to contact us should you need any of our services. Now on to my report. Mortgages A Brief History
In 1975 when I got into the real estate business banks didn’t do mortgages per say. Mortgages were mostly done by the trust companies. Banks would give you a loan secured by real estate usually no more than 50% of the value. Back then many people would borrow enough to put in a basement. Finish the basement ,live in the basement while repaying the loan and then borrow again to finish the house. Trust companies would lend a conventional mortgage of 75% of the appraised value or the purchase price which ever was least as dictated by the bank act. As you can imagine selling real estate was a little more difficult than it is today. In the governments attempt to make home ownership easier for Canadians CMHC came up with high ratio insurance which gave the lenders the option to lend up to 90% of the purchase price or the appraised value which ever was least. The lender would tack the insurance fee on top of the mortgage and send the fee off to CMHC. This was a win win for all involved . Home buyers, lenders, realtors, appraisers and lawyers. More people qualified to buy homes so more homes sold and more homes were built and more people were put to work.
Last but not least lenders couldn’t lose because the loan was insured by the government. YES FOLKS THE GOVERNMENT CAN DO SOMETHING RIGHT. Although they receive little in the way of recognition CMHC is one of the best things to have happened for all Canadians economically and beneficially. Helping us all prosper. Of course by now banks were into mortgages in a big way because our historically conservatives banks liked the no risk factor associated with high ratio insured mortgages. The competition was fierce . The 1981 recession slowed things down a bit when rates hit 22% but when the rates came back down things rolled on again until 1989 when the next recession came. In my opinion this was a much tougher recession. Consumers hated the new HST tax and just refused to spend. Many business’s folded including most of the trust companies who were caught with most of the commercial mortgages which with so many companies struggling many were in default and of course not insured because high ratio insurance was not available on commercial properties. A long come our friendly banks who pick up their assets for pennies on the dollar and very few trust companies survive this recession. Even today it is very difficult to get a commercial mortgage with most of the banks and lenders willing to do only 50 to 65% of the appraised value with their main competition today being the credit unions or some government agency as a choice of last resort.
Although commercial loans are difficult ( I would love to see high ratio insurance for commercial) residential mortgages are amazingly easy to obtain with 30/40 year amortizations, no down payments and I declare products for the self employed and commissioned consumers. A vast array of products and terms. There has never been an easier or better time to get a residential mortgage. There are even products for previous bankrupts and those with past credit problems. I continue to be amazed as CMHC and the lenders continue to make home ownership more obtainable. CMHC even has some competition for their insurance products in the private sector. Note: Do not confuse mortgage insurance with life insurance. Mortgage insurance insures the mortgage for the lender. If the borrower doesn’t pay the mortgage the insurer will pay the bank out. Hence the bank can’t lose. Mortgage insurance fee average 3.75 %. Eg: 100,000 mortgage the lender gives you $103750.00. Your payments are based on $103,750 and on closing the $3750 (the premium) is sent to the insurer (CMHC). You pay for it and the bank /lender can’t lose. So you see why lenders love high ratio mortgages and why it’s so easy to get a residential mortgage today.
Most mortgages fall into two classes Prime ( strong borrower with a high beacon score) and Sub-prime ( weaker borrower with a lower beacon score) Note: Every borrower has a beacon score which is utilized to determine their credit worthiness. Credit agencies such as Equifax and Trans Union use a complicated formula based on your credit history that determines your ability to pay two years down the road to assign your personal beacon score usually ranging from a low of 400 to a high of 800. Between 600 and 800 is prime and anything less normally sub prime. It is very important to maintain a good beacon score to access credit at a reasonable interest rate. The interest rate you are charged is mostly determined by your beacon score. Right now we can get a prime borrower 5.019 %. A sub-prime borrower would pay between 9% and 12%. To give you an example the prime borrower would pay around $500 per month PI (principle and interest) on a $100,000 mortgage over 25 years. Sub-pr
Need a marketing tip which will cost you practically nothing, but will have far-reaching benefits for you and your client??Instead of spending $$$ on advertising, think about providing a product or service for free to a charitable or non-profit organization or a local community group with little funding.This offer has a two-fold effect -- your client doesn't have to pay, so they will be thrilled -- and they will likely tell EVERYONE about your kind gesture so you will become better known and be respected. Remember to do this with kindness in your heart, not just as a way to get publicity, however, because it's easy to see through a a gesture that is not genuine.Ask them if it's okay for you to write and distribute a press release (show it to them if they'd like to see it), then contact your local radio, TV, newspaper and business groups to pitch a story. Include a written testimonial from your client, and get a photo of the two of you if possible (with the product would be terrific).* * * * * * * * * * * * * * * * * * * * *MAKE A CATCHY HEADING* * * * * * * * * * * * * * * * * * * * *Make sure the press release has a very catchy headline to grab the media's attention, and you'll probably discover at least a few media will contact you for an interview or
We all in most cases would rather make our own mistakes than feel taken advantage of by some professional we don’t know or trust. That is why some one listing their house will always list with a friend over an experienced realtor because trust is more important than experience in the minds and hearts of consumers even though in the long run it may cost them dearly.
In this report my goal is to give you information. How you use it will be up to you. My goal is to gain your trust so you will not hesitate to contact us should you need any of our services. Now on to my report. Mortgages A Brief History
In 1975 when I got into the real estate business banks didn’t do mortgages per say. Mortgages were mostly done by the trust companies. Banks would give you a loan secured by real estate usually no more than 50% of the value. Back then many people would borrow enough to put in a basement. Finish the basement ,live in the basement while repaying the loan and then borrow again to finish the house. Trust companies would lend a conventional mortgage of 75% of the appraised value or the purchase price which ever was least as dictated by the bank act. As you can imagine selling real estate was a little more difficult than it is today. In the governments attempt to make home ownership easier for Canadians CMHC came up with high ratio insurance which gave the lenders the option to lend up to 90% of the purchase price or the appraised value which ever was least. The lender would tack the insurance fee on top of the mortgage and send the fee off to CMHC. This was a win win for all involved . Home buyers, lenders, realtors, appraisers and lawyers. More people qualified to buy homes so more homes sold and more homes were built and more people were put to work.
Last but not least lenders couldn’t lose because the loan was insured by the government. YES FOLKS THE GOVERNMENT CAN DO SOMETHING RIGHT. Although they receive little in the way of recognition CMHC is one of the best things to have happened for all Canadians economically and beneficially. Helping us all prosper. Of course by now banks were into mortgages in a big way because our historically conservatives banks liked the no risk factor associated with high ratio insured mortgages. The competition was fierce . The 1981 recession slowed things down a bit when rates hit 22% but when the rates came back down things rolled on again until 1989 when the next recession came. In my opinion this was a much tougher recession. Consumers hated the new HST tax and just refused to spend. Many business’s folded including most of the trust companies who were caught with most of the commercial mortgages which with so many companies struggling many were in default and of course not insured because high ratio insurance was not available on commercial properties. A long come our friendly banks who pick up their assets for pennies on the dollar and very few trust companies survive this recession. Even today it is very difficult to get a commercial mortgage with most of the banks and lenders willing to do only 50 to 65% of the appraised value with their main competition today being the credit unions or some government agency as a choice of last resort.
Although commercial loans are difficult ( I would love to see high ratio insurance for commercial) residential mortgages are amazingly easy to obtain with 30/40 year amortizations, no down payments and I declare products for the self employed and commissioned consumers. A vast array of products and terms. There has never been an easier or better time to get a residential mortgage. There are even products for previous bankrupts and those with past credit problems. I continue to be amazed as CMHC and the lenders continue to make home ownership more obtainable. CMHC even has some competition for their insurance products in the private sector. Note: Do not confuse mortgage insurance with life insurance. Mortgage insurance insures the mortgage for the lender. If the borrower doesn’t pay the mortgage the insurer will pay the bank out. Hence the bank can’t lose. Mortgage insurance fee average 3.75 %. Eg: 100,000 mortgage the lender gives you $103750.00. Your payments are based on $103,750 and on closing the $3750 (the premium) is sent to the insurer (CMHC). You pay for it and the bank /lender can’t lose. So you see why lenders love high ratio mortgages and why it’s so easy to get a residential mortgage today.
Most mortgages fall into two classes Prime ( strong borrower with a high beacon score) and Sub-prime ( weaker borrower with a lower beacon score) Note: Every borrower has a beacon score which is utilized to determine their credit worthiness. Credit agencies such as Equifax and Trans Union use a complicated formula based on your credit history that determines your ability to pay two years down the road to assign your personal beacon score usually ranging from a low of 400 to a high of 800. Between 600 and 800 is prime and anything less normally sub prime. It is very important to maintain a good beacon score to access credit at a reasonable interest rate. The interest rate you are charged is mostly determined by your beacon score. Right now we can get a prime borrower 5.019 %. A sub-prime borrower would pay between 9% and 12%. To give you an example the prime borrower would pay around $500 per month PI (principle and interest) on a $100,000 mortgage over 25 years. Sub-p
People will always stress that having a well researched business plan is key before you start your business. Although creating a business plan is often an important step in the evolution of a business, particularly if you need financing or you are not experienced at running a business, it is not necessarily the essential first step. There are two key elements that should be completed prior to the business plan:The business modelThe strategyWhat is a Business Model?While the word model often stirs up images of mathematical formulas, a business model is in fact a story of how a business works. In general terms, a business model is the method of doing business by which a company can generate revenue. Both start-up ventures and established companies take new products and services to the market through a venture shaped by a specific business model. In their paper, The Role of the Business Model in Capturing Value from Innovation, Henry Chesbrough and Richard S. Rosenbloom outlined the six basic elements of a business model:Articulate the value proposition – the value created to users by using the productIdentify the market segment – to whom and for what purpose is the product useful; specify how revenue is generated by the firm.
In 1975 when I got into the real estate business banks didn’t do mortgages per say. Mortgages were mostly done by the trust companies. Banks would give you a loan secured by real estate usually no more than 50% of the value. Back then many people would borrow enough to put in a basement. Finish the basement ,live in the basement while repaying the loan and then borrow again to finish the house. Trust companies would lend a conventional mortgage of 75% of the appraised value or the purchase price which ever was least as dictated by the bank act. As you can imagine selling real estate was a little more difficult than it is today. In the governments attempt to make home ownership easier for Canadians CMHC came up with high ratio insurance which gave the lenders the option to lend up to 90% of the purchase price or the appraised value which ever was least. The lender would tack the insurance fee on top of the mortgage and send the fee off to CMHC. This was a win win for all involved . Home buyers, lenders, realtors, appraisers and lawyers. More people qualified to buy homes so more homes sold and more homes were built and more people were put to work.
Last but not least lenders couldn’t lose because the loan was insured by the government. YES FOLKS THE GOVERNMENT CAN DO SOMETHING RIGHT. Although they receive little in the way of recognition CMHC is one of the best things to have happened for all Canadians economically and beneficially. Helping us all prosper. Of course by now banks were into mortgages in a big way because our historically conservatives banks liked the no risk factor associated with high ratio insured mortgages. The competition was fierce . The 1981 recession slowed things down a bit when rates hit 22% but when the rates came back down things rolled on again until 1989 when the next recession came. In my opinion this was a much tougher recession. Consumers hated the new HST tax and just refused to spend. Many business’s folded including most of the trust companies who were caught with most of the commercial mortgages which with so many companies struggling many were in default and of course not insured because high ratio insurance was not available on commercial properties. A long come our friendly banks who pick up their assets for pennies on the dollar and very few trust companies survive this recession. Even today it is very difficult to get a commercial mortgage with most of the banks and lenders willing to do only 50 to 65% of the appraised value with their main competition today being the credit unions or some government agency as a choice of last resort.
Although commercial loans are difficult ( I would love to see high ratio insurance for commercial) residential mortgages are amazingly easy to obtain with 30/40 year amortizations, no down payments and I declare products for the self employed and commissioned consumers. A vast array of products and terms. There has never been an easier or better time to get a residential mortgage. There are even products for previous bankrupts and those with past credit problems. I continue to be amazed as CMHC and the lenders continue to make home ownership more obtainable. CMHC even has some competition for their insurance products in the private sector. Note: Do not confuse mortgage insurance with life insurance. Mortgage insurance insures the mortgage for the lender. If the borrower doesn’t pay the mortgage the insurer will pay the bank out. Hence the bank can’t lose. Mortgage insurance fee average 3.75 %. Eg: 100,000 mortgage the lender gives you $103750.00. Your payments are based on $103,750 and on closing the $3750 (the premium) is sent to the insurer (CMHC). You pay for it and the bank /lender can’t lose. So you see why lenders love high ratio mortgages and why it’s so easy to get a residential mortgage today.
Most mortgages fall into two classes Prime ( strong borrower with a high beacon score) and Sub-prime ( weaker borrower with a lower beacon score) Note: Every borrower has a beacon score which is utilized to determine their credit worthiness. Credit agencies such as Equifax and Trans Union use a complicated formula based on your credit history that determines your ability to pay two years down the road to assign your personal beacon score usually ranging from a low of 400 to a high of 800. Between 600 and 800 is prime and anything less normally sub prime. It is very important to maintain a good beacon score to access credit at a reasonable interest rate. The interest rate you are charged is mostly determined by your beacon score. Right now we can get a prime borrower 5.019 %. A sub-prime borrower would pay between 9% and 12%. To give you an example the prime borrower would pay around $500 per month PI (principle and interest) on a $100,000 mortgage over 25 years. Sub-p
My 16 year-old daughter said, “Gee Dad! You look just like an accountant” And she wasn’t being complimentary. Accountants are perceived to be boring, stodgy and conservative. Over the years we’ve been the butt of many jokes. I’ve heard them all. Why did the accountant cross the road? Because he looked up the file and that’s what they did last year! Ha Ha! What do accountants use as a contraceptive? Their personality! Ha Ha!” Why do accountants become accountants? They don’t have the charisma to be undertakers! Ha Ha! What do they call an accountant at the bottom of the sea? A bloody good start! Ha Ha! I think I am the exception. That’s why I’ve begun to call myself a business strategist and counselor. “You’re still an accountant,” says teenage daughter. I am still an accountant and I’m still as passionate about it as the day I started. Because accountants have an impact on people’s lives. The advice we give changes people’s businesses which in turn changes their lives. I’m excited in my role of accountant. Accounting is not stodgy. Accounting is exciting. Accounting is cool! My ambition is to become the “cool dude of accounting”. (do they still say “dude”, do they still say “cool”. Re
Although commercial loans are difficult ( I would love to see high ratio insurance for commercial) residential mortgages are amazingly easy to obtain with 30/40 year amortizations, no down payments and I declare products for the self employed and commissioned consumers. A vast array of products and terms. There has never been an easier or better time to get a residential mortgage. There are even products for previous bankrupts and those with past credit problems. I continue to be amazed as CMHC and the lenders continue to make home ownership more obtainable. CMHC even has some competition for their insurance products in the private sector. Note: Do not confuse mortgage insurance with life insurance. Mortgage insurance insures the mortgage for the lender. If the borrower doesn’t pay the mortgage the insurer will pay the bank out. Hence the bank can’t lose. Mortgage insurance fee average 3.75 %. Eg: 100,000 mortgage the lender gives you $103750.00. Your payments are based on $103,750 and on closing the $3750 (the premium) is sent to the insurer (CMHC). You pay for it and the bank /lender can’t lose. So you see why lenders love high ratio mortgages and why it’s so easy to get a residential mortgage today.
Most mortgages fall into two classes Prime ( strong borrower with a high beacon score) and Sub-prime ( weaker borrower with a lower beacon score) Note: Every borrower has a beacon score which is utilized to determine their credit worthiness. Credit agencies such as Equifax and Trans Union use a complicated formula based on your credit history that determines your ability to pay two years down the road to assign your personal beacon score usually ranging from a low of 400 to a high of 800. Between 600 and 800 is prime and anything less normally sub prime. It is very important to maintain a good beacon score to access credit at a reasonable interest rate. The interest rate you are charged is mostly determined by your beacon score. Right now we can get a prime borrower 5.019 %. A sub-prime borrower would pay between 9% and 12%. To give you an example the prime borrower would pay around $500 per month PI (principle and interest) on a $100,000 mortgage over 25 years. Sub-p
Fluid and liquid layouts are definitely considered the 'ideal' design type right now, and I cannot agree more. I much prefer a fluid design over a set layout. For text we know that relative sizing (meaning the use of em, ex, and percentages) are preferred over the use of pixel sizing.In any event, whether your website design is a fixed layout or a liquid layout - there should still be a measure of fluidity in text sizing. When I use the phrase 'text sizing' I refer to the fact that users can control the size of text on a page. For instance, if a Firefox user they may employ the popular CTRL + + to increase, CTRL + - to descrease the text size. Others may use the ability of their mouse scroller to adjust zoom the text size, etc.. While this may seem to be a simple observation, and one that is of little importance, it's not quite as straightforward as that.There are often elements, such a section headers or navigation areas, that break when zoomed - meaning they just don't fit in the space anymore. This can happen in a liquid layout also, believe it or not. Many people use horizontal tab-like navigation, made pretty with images behind it. Now, when zoomed too much, sometimes the text becomes too big for the screen size of the viewer, and in the nature of a liquid layout, the horizontal navigation wraps and cont
Most mortgages fall into two classes Prime ( strong borrower with a high beacon score) and Sub-prime ( weaker borrower with a lower beacon score) Note: Every borrower has a beacon score which is utilized to determine their credit worthiness. Credit agencies such as Equifax and Trans Union use a complicated formula based on your credit history that determines your ability to pay two years down the road to assign your personal beacon score usually ranging from a low of 400 to a high of 800. Between 600 and 800 is prime and anything less normally sub prime. It is very important to maintain a good beacon score to access credit at a reasonable interest rate. The interest rate you are charged is mostly determined by your beacon score. Right now we can get a prime borrower 5.019 %. A sub-prime borrower would pay between 9% and 12%. To give you an example the prime borrower would pay around $500 per month PI (principle and interest) on a $100,000 mortgage over 25 years. Sub-prime at 12 % that same payment would be around $1200 per month. So you can see how important your beacon score.
Here are some tips on how to maintain a good beacon score
1. Always make your minimum payment on credit cards and never be late.
2. If in business. Always pay your personal bills before business loans. (usually only personal credit is shown on your credit check most business loans are not.
3. Do not shop for credit by applying at different lenders. The system assumes you are turned down and each application lowers your score. ( a plug here for mortgage brokers we take one application and can shop over 40 lenders for you with one credit check thus maintaining your good beacon score.)
How does bankruptcy effect my beacon score ? Many of my customers have been bankrupt in the past. Bankruptcy today is common place and no longer as stigmatic as it once was. Computers have basically taken the human factor out of the credit system. It no longer makes sense to struggle for years under a mountain of debt if your circumstances change and you can’t afford to meet your commitments. Bankruptcy quite often is the most reasonable solution mainly because the credit system gives you no recognition for struggling and overcoming your financial problems. Once you are behind your beacon score drops and no one will deal with you. That bad history stays on your credit for 7 years. If you go bankrupt you are usually discharged within 9 to 12 months. After that you have to re-establish a credit history usually by a secured credit card or car loan and with in 18 months with a good job you would qualify for a mortgage. Yes , record of the bankruptcy stays on your credit but once you re-establish it is not as detrimental as a previous bad repayment history. In many cases as long as there’s no substantial equity in your home you can even keep making your mortgage payments and keep your home through the bankruptcy. Please understand I am not an advocate for going bankrupt. That is a very personal decision but now you know how it works and if a decision is required that decision can be based on the reality of the situation and not misinformation.
With this report I have just scratched the surface of the basics of how the mortgage industry works and the credit scoring system. Hopefully you have found it informative and insightful. I would be pleased to help you with any real estate , mortgage, appraisal or business consultation you may need.
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