Three clients (that’s right 3 new clients…what is happening?) called this week all at the end of their rope.  Welling up in our office, all of them told us how the house of cards was caving in.  All three couples had a common denominator.   The financial pressure was so great that they feared losing their homes for the first time and needed solutions fast.  They blamed their banks for rolling out large lines of credit which of course over time, all had used, eventually maxing them out.  Now they were using one credit card to pay another or throwing it on their credit line.  They all tried to keep up but the writing was on the wall. 

These are responsible hard working couples, two of them make over $100K who prided themselves on their credit and now the stellar credit was starting to suffer.  It doesn’t take much to take a financially solid couple and turn their lives upside down, a reduction in overtime, reduced work hours,  maternity and paternity leaves and or sickness.  Luckily, for two of the couples,  they called us in the nick of time.  We were able to refinance their homes and there was enough equity that we were able to get their lines of credit and credit cards paid and their mortgage payment  is  still very affordable.   One couple had let their credit slide with late payments so we had to organize a private second mortgage in order to pay off their credit lines and overdue income taxes.  In less than a year, their credit score will rebound and we will be able to get them the best mortgage available.  Don’t stick your head in the sand.  If you are feeling you are on the slippery slope call us.  We’re hear to help. 

Until just recently there was a strong consensus that rates would start rising later this year. Then with last week’s downgrading of the United States credit rating, everything has changed 180 degrees.

Peter Gibson, CIBC World Markets was quoted as saying a few days ago, “I think it’s now clear that there are a lot of serious problems in the world and it’s more likely that we’re setting the stage for a sustainably low level of interest rates for a very long time”.

With the U.S. nearly defaulting on their international debt, the historic downgrading of their credit rating by Standard & Poors, and the continued turmoil from the European Union stretching to Greece and beyond, financial volatility will absolutely continue to be the norm. In addition, the U.S. Federal Reserve last week, attempted to calm the stock markets by stating that they would not raise rates until the end of 2013. That’s two years away. The Bank of Canada has little choice but to follow suit. So it is all but certain, that we can expect mortgage rates to remain low for another couple of years, perhaps even longer. So please forget any media hype about rates rising soon. Such negative hype is designed to sell more magazines and newspapers, and is rarely credible.

Folks, this is good news, no it’s GREAT NEWS! House prices, house sales and affordability should now continue to remain healthy. However, with global financial volatility becoming entrenched, the prospect of a ‘double dip’ recession is still not out of the question.

What all this means is that this we have an opportunity of a lifetime to get into home ownership and for existing homeowners to get their financial houses in order. In other words, eliminate credit card debt and lines of credit, STOP PAYING HIGH INTEREST & START SAVING.

For expert advice and financial solutions beyond what you’re bank can give you, please call us to help you eliminate consumer debt and generate wealth. We’ve got you covered.

Jason bought a house based on a preapproval he received from his bank. When he went to waive the financing condition the bank told him that he wasn’t approvable. That’s when we got involved.

We determined that he bought too high, and could not afford the property he wanted. It gets better. His credit score was below the minimum and he had too much consumer debt to qualify at that price level.

How could this happen? How could he get a bank preapproval in the first place? Well, he told the bank where he worked and how much he earned, and the bank did the calculations and told him he could afford up to $300,000. Telling the realtor he was preapproved, he went out and bought a house. Everyone was happy, including the sellers who thought they had sold their house.

Unfortunately, the bank did not look at his credit score, his debt load (they did not look at his credit report) and so with his high car payment and two maxed out credit cards, Jason did not qualify anyway, that is,  even if his score were satisfactory.

Had he come to us in the first place, we would have told him he would have to wait to buy because he needed time to pay down his credit card balances and let his credit score rise. We also told him he should not purchase for more than $250,000.

What a waste of everyone’s time. We see this happen all the time. The moral of this story is if you are selling your home, (whether on MLS or privately)  insist on having your prospective buyer get                preapproved by us, because bank preapprovals often cannot be relied upon. We verify everything, and we will provide a GUARANTEED PRE-APPROVAL in writing. You can take that to the bank. LOL just kidding, you won’t have to will you?

Remember, we’ve got you covered, we are on your side, and we will save you money with the lowest rates anywhere. Call THE PRICE TEAM FIRST.

BEWARE OF BANK RENEWALS

A new client of ours told her bank that she was not renewing with them, and that she was looking for a new mortgage. Banks have the right to put you in a 6 month mortgage, but not a 5 year closed, fixed rate mortgage like her bank did to her. When she went to pay them out, they told her she would have to pay a $9,200. penalty, She was shocked. The penalty should have been no more than 3 months.

 She didn’t know her rights and she didn’t know the proper procedure. Folks when you are a client of ours, you never have to worry about stuff like this. We contact you prior to maturity and explain all your options. In short, it is our mantra to protect you from such unpleasant surprises, and to save you money at every opportunity.

As experts, we knew that the bank had made a mistake. We told her to ask them to produce ‘in writing’ anything she had signed to commit her to a new 5 year mortgage.  When they could not, they said it was a mistake and apologized. We got her penalty reduced to 3 months which was all they were entitled to. Had she been an existing client of ours, there would have been ZERO PENALTY because we would have had her go ‘month to month’.

By the way, the reason she went past her maturity date was because the bank sent her their renewal letter only a few weeks left and she didn’t have sufficient time to search elsewhere.  The bank offered her a renewal rate of 4.89%  when she was deserved of much less since she had not missed a payment.

When it comes to the biggest financial obligation of a lifetime, it no longer makes sense to get a bank mortgage on your own when you can have a professional (independent) mortgage broker (THE PRICE TEAM) protect and look after your best interests, one hundred per cent of the time. Alone, your bank will win. With us, you will win, and we will guarantee you tens of thousands of dollars (savings) in your pocket over the longer term, all at no cost from our end, OAC.

For your next mortgage need, do yourself a favour. Don’t call your bank and don’t use a bank mortgage specialist either.  Call us first. You’ll be so glad you did. Our best 5 year fixed rate is 3.74% versus the banks’ 5.39% and we are also below credit union best rates. In fact our rates are the best in the country. Our best variable rate is 2.25%. The banks are around 2.8%. Also, forget anonymous online or telephone mortgage lenders when you can deal with us face to face right here in Fergus. We open up the entire mortgage market to you and we are always on your side.