18 Apr


Mortgage Tips

Posted by: Tracy Luciani Price

It’s a Sellers market out there…and a hot market too!

With it can come disappointment if you are not properly prepared.

You, your realtor and the seller all think you have been pre-approved and you are on solid footing. You purchase only to find out there is a blemish with your credit, or because you are a contract worker not a permanent employee; the bank tells you after you have purchased without conditions, you are declined. Buyers are sent scrambling after they have waived financing and low and behold there are issues, issues they never even considered. If financing cannot be secured, buyers risk being sued by the vendor.

Thorough Analysis Needed Prior to Going ‘Firm’

We have had a couple of cases come to us just two weeks before closing, in crisis. We had to pull all stops to attempt to find financing. Both clients were surprised to find out after purchasing and going firm that the bank pulled the plug on financing even though they were ‘pre-approved’. The bank never pulled credit for the ‘pre-approval’s’ causing them to miss that both clients had issues, one client having a former bankruptcy and the other a collection.   They would have never qualified for a prime bank rate with these  major issues flagged on their credit bureau.  Fortunately to our relief and our clients, we were able to get both these mortgages approved, and even successfully negotiated a fabulous rate with a prime lender for the client with a collection.

Again, the benefit of dealing with a mortgage broker with a great reputation.

Even just this past weekend, a client called in a bit of a panic because there were four offers going in on a house. We re-assured the realtor that our client was fine to go in firm because we had completed due diligence on their ability to buy. If we were not able to be contacted on a weekend they wouldn’t have purchased. We help our clients in these crazy times to feel totally secure to go ahead without financing conditions if need be.

No Conditions are Putting Buyer’s at Risk

We are seeing mortgages ‘in crisis’ days before closing because buyers are not getting pre-approved. Multiple offer scenarios are resulting in buyers feeling forced to go ‘firm’ to win.

This is so dangerous and stressful for all concerned, not to mention it can also be a tremendous waste of everyone’s time. However, avoiding such a nasty scenario can be easily prevented.

The Banks Pre-Qualification is NOT a Pre-Approval

First, understand that if you are pre-approved by the bank you actually are not. You go out and buy thinking you are solid when it couldn’t be further from the truth.

You see, the banks do not pre-approve you like we do. The banks only pre-qualify you, meaning that they ask you for your income, crunch a few numbers and tell you verbally only what you can afford. That’s all. And that is not enough.

Get Your Pre-Approval from The Price Team so You Have Peace of Mind

All this can be avoided if you get pre-approved by us at the lowest rate in Canada, in the first place. We verify your income, employment, credit and down payment in writing to ensure there will not be any surprises prior to you shopping for a house. We  do a thorough analysis, you can count on, especially if you need to go firm on financing.

When we pre-approve you, the only thing still outstanding is the property you buy, which must be marketable and in good condition. When these conditions are met, a smooth buying experience ensues.

With our pre-approval you can go out and buy with complete confidence. You can bank on that!

12 Apr


Mortgage Tips

Posted by: Tracy Luciani Price

As some of you head toward retirement it’s time to start thinking about the mortgage you are carrying.

Too often we see clients who wait for a health crisis and then come to us for help. Remember, it’s very difficult to get money from a bank when you are retired. Strategize with us before retirement and you will have peace of mind when you retire.

There is always the option to sell your property but most times people are not ready to give up their homes and more often than not, in this part of Ontario, rent is higher than mortgage payments.

Mortgage Retirement Options

Here are a few ways you can change your mortgage now and protect yourself for the future.

  1. You can take a longer amortization and do an equity take out. That’s means you have cash should the unforeseen happen.  We offer up to 35 year amortizations at low fixed and variable rates.
  2. Take a mortgage/line of credit product. You can go up to 80% of the value of your house if income supports.   When retired and on fixed income this is difficult sometimes, so arrange it beforehand.
  3. Take a line of credit rather than a mortgage. You pay higher rates than on a traditional mortgage but you are out with no penalties when you sell.

Don’t Wait for the Unforeseen

We have helped many homeowners in the area ease into retirement with no worries. If you are retiring in the next five years it makes sense to come and talk to us about your options. Don’t wait for a health crisis or a severance or even a death of a spouse to plan for your mortgage in retirement. You don’t have to feel badly that you have a large mortgage heading into retirement.  The key is making it affordable and without bringing along consumer debt.

Use Prepayment Privilege Rather than a Lower Amortization

One of the common mistakes homeowners make is cranking down the amortization as retirement nears. While that is fine while working keep in mind that the banks tend not to let you increase your amortization once you are at a lower income from retirement or the unforeseen. You are much smarter to take a 25-35 year amortization and utilize the prepayment options at typically 15-20%. Prepaying will reduce your principal while still working, and at retirement you have the option to return to the lower affordable payment if you have increased your mortgage via the frequency pre-payment option.

Amortization Scenarios

Let’s say you have a $250,000 mortgage and you have a 15 year amortization at 3.09%. Your payment is $1790.00 per month plus property taxes. That’s an easy payment for a couple earning $100,000 a year. But it’s a very different story if one of you is either forced into early retirement because of a health crisis or the job becomes redundant.

Now here’s our plan. Prior to retirement, especially if there is a chance you may be given your walking papers or health is already a concern, apply with us for a 35  year amortization at the variable rate of 2.4%, your payment drops to $870. Continue to prepay your mortgage if you wish as much as 50 k per year through either lump sums or monthly increased payments, but keep the lowest payment for reasons mentioned above.

Call Us to Strategize

As we always say, live for today but have a Plan B if life throws you a curve ball. Come and talk to us prior to retiring so you don’t find yourself in a jackpot.

6 Apr



Posted by: Tracy Luciani Price

Back in 2010 the Big Banks introduced a new mortgage product called a ‘Collateral
Mortgage’ (CM). Today, Banks no longer offer the traditional ‘standard charge’
mortgage. CMs are dangerous and should be avoided. Here’s why:
1. CMs act as revolving credit giving you global limit access for potential future needs
without the need to pay legal fees. What, no lawyer? Look out it’s a trap.
2. The Collateral Mortgage is registered for more than the value of your property. Hence
it appears you have no equity. Therefore, no other creditor will touch you.
3. CMs secure every unsecured credit item ie) credit cards, loans, lines of credit etc.,
without your knowledge. Banks do not willingly tell clients this!
4. Even if you never miss a mortgage payment, but might be late on a few credit
card payments, the bank has the right to put your mortgage into default and increase
your interest rate.
5. Because CMs give the bank virtual control over your finances and are more difficult
to get out of without huge fees, the bank does not need to be competitive. They can
charge more and they can refuse you more easily. They end up with more profit, you
end of paying more. This is anything but a safe and friendly mortgage.
6. The banks now charge mortgage ‘break’ penalties, which are excessive and
unconscionable. When most people enter into a mortgage, they think they will not
move during the typical 5 year term. But life happens. Job loss, relocation, divorce,
death and the decision to move up or down etc., cause over 40% of borrowers to
break their mortgages. The cost is huge. Instead of paying 3 months’ interest like
before (typically $2,100) you now pay 3-4x more. We have seen some penalties
exceed $20,000. As a result many can’t move, and worse.
7. With every bank mortgage, staff are trained and get bonuses to sell mortgage life
insurance. They don’t ask any questions, nor are they trained to. This is the worst
scam of all. You are asked one very long, ambiguous (not several clear specific)
question(s) about your health history. If you are confused and want to decline
coverage they try to scare you into signing. This is called ‘Post Claim Underwriting’
where approval is automatic and premiums are collected until there is a claim. The
goal is then to deny any and all claims as possible. It really is a form of entrapment.
Beyond Collateral Mortgages, Penalties and bank Insurance the banks purposely
conceal and avoid providing proper disclosure makes getting a bank mortgage today,
very perilous.
We would be happy to sit down with you to share more. Please get informed.
Please watch these CBC MARKETPLACE episodes on YOU TUBE: COLLATERAL
MORTGAGE INSURANCE CANADA. They speak for themselves. It goes much deeper.
We are on your side. Please call us for more info.
6 Apr



Posted by: Tracy Luciani Price

If you own a house and have a mortgage, you must get informed about what’s really
going on with bank mortgages. In fact once you’ve watched these episodes, you will be
shocked, disgusted, even appalled and angered.
Kudos to CBC MARKETPLACE for doing such a good job and a public service by
exposing the extent to which the banks have gone to gouge customers for the sake of
The episodes can be found on YOU TUBE. Look for COLLATERAL MORTGAGE or
INSURANCE CANADA. The last one is a real jaw dropper as we see real life examples
of how lives are being destroyed. Victims use the words SCAM, SNOW JOB,
ENTRAPMENT etc. and they are ‘pissed’ as was stated more than once.
We have had clients call current bank practices ‘criminal’. One recently said “They are
getting away with murder.” You may feel the same way after you watch. At the minimum
our banks our cunning, callous, deceitful, and all too powerful. They have honed their
craft with such precision down to a science.
After one episode about collateral mortgages TD and the other big banks promised
changes to explain in easy to understand language, both in branch and online. CBC
went back to 3 branches to test this out. TD failed miserably and it became clear that
the banks ‘filibuster’ like politicians do by not really answering the question asked, and
often not at all. Because they just don’t care.
You owe it to yourselves to learn as much as you can about current bank practices. You
owe this to yourselves, especially if you are homeowners. Stop letting the banks take
advantage of you.
The old Mr. Potter (banker) was crafty. Today’s Mr. Potter is more than cunning.
For your next mortgage ask yourself where you can find a mortgage you can trust that is
not dangerous to your financial health. It should be clear, that is not with any big bank.
We deal with over 40 lenders who have policies and practices that are fair and friendly,
and we invite you to sit down with us for a leisurely discussion that will benefit you
1 Apr



Posted by: Tracy Luciani Price

Most home owners think that only first time buyers qualify for the minimum 5% down
rule and that 20% down is required.
Not true. The 20% equity rule applies to refinance only. Yes it used to be the 5% down
was only for first timers and to qualify you could not own for at least 5 years. Those
guidelines where quietly eliminated back in 2002 when lending became easier. The
important news is that they are still in effect.
We see many people who want to move up and eliminate consumer debt but believe
they need 20% down. For this reason they think there is not enough equity to do both.
Wrong. We have successfully helped many clients sell their homes, pay off all existing
debt, putting 5% down on the next purchase all at the same time lowering their total
payments slightly.
had $80K in credit card debt and loans costing them $1,686 per month.
They sold for $357,000 less mortgage of $223,000 leaving a net $134,000 less 5% real
estate commission $17,850 less consumer debt $80,000 leaving them with $36,150
They bought a beautiful much larger home for $454,000 with 5% down of $22,700
leaving them sufficient funds for legal and closing costs. Note - with a 20% down
payment, this never would have worked. They also purchased bridge financing so they
could take 3 weeks to decorate and make some changes to their new home before
moving in. A low/no stress move indeed!
The magic lay in the final tally and swapping bad (high cost) debt for good (very low
cost) debt. Because todays rates are below financing costs 5 years ago, Vicky & Tom
ended up saving $416.00 a month from their previous situation.
Obviously to make it work, they needed to have sufficient equity and income to qualify
for the bigger mortgage, but what a solution. One that improved their quality of life
greatly, starting afresh with no consumer debt.
Many feel stuck with high consumer debt and payments and no where to go or get out.
We may have an answer for you.
Please call us for a free, no obligation review of your situation. We will provide you with
our analysis of your ability to trade up, possibly eliminate your debt, and put a big smile
on your face.
We love finding solutions like this, that you will not get from a bank.