How To Buy A Home In A Hot Market

Buying a home can be an exciting and stressful time.  Buying in a hot market like our current spring market can be even more of a challenge as houses hit the market and sell fast. 

So what should you do to make sure you don’t lose that perfect house?  To start,  find yourself a great realtor that understands how important it is to be first in to see a house when it hits the market.  A full time professional realtor that understands the community you are looking in and what your needs are.

But even before that, you should make sure you have your pre-approval in place.  In a fast paced market you want to be confident when you present an offer that you can afford the home you have chosen. If a bidding war ensues you want to know what your limitations are  and really understand financially that you can afford the home.  Nothing is more disappointing than outbidding other potential buyers just to find out that you are unable to get approval on your financing. 

One of the ways you can look at homes with confidence is to use our “Apply Now” on line application.  It is quick and easy and gets the ball rolling even before your initial visit with Harmony Mortgage Group.  It places you in the queue as financial institutions are also incredibly busy in a market like this and are dealing with applicants as the paper work arrives.  So by Applying On Line, you get a head start and jump to the front of the line while others are waiting  to get appointment times with their lenders.   Just another way Harmony Mortgage Group takes care of their clients.

Once your financing has been approved, you and  your realtor can view homes with confidence knowing exactly what you can afford and ultimately find the perfect home for you.

At Harmony Mortgage Group we offer a complimentary cleaning service through our sister company Harmony Home Services to any client that has a mortgage fund through us.  Ask our brokers for the details.  Some restrictions do apply.

Meet Our Team

Tammy O’Callaghan

Phone: 604-845-0559

tammyomortgages@shaw.ca

Carie Pool

Phone: 604-703-8748

carie@HarmonyMortgage.ca

Tania Vermeer

Phone: 604-819-3097

Tania@HarmonyMortgageGroup.ca

Thinking about buying a Foreclosure?

Foreclosures can often represent a great investment in real estate and are a good way to gain equity fast if the market is stable or on an upward swing.  Although Foreclosures can be  a great deal they are not for everyone.  The process is different from that of a more traditional MLS listing as there are rules and laws that surround foreclosure sales that must be met.

If you are not up for the stress of making an offer and then having a court date set where other potential bidders are able to steal the deal from you then buying a foreclosure is not for you.  If you need a bit more certainly in your real estate transaction then a more traditional purchase is probably best.  But if you are able to handle the uncertainty and don’t have hard and fast dates that need to be adhered to then a Foreclosure could not only save you a great deal of money in the long run, but also be a great investment short term.

As mortgage brokers we at Harmony Mortgage Group understand the Foreclosure Mortgage requirements and because we know that a foreclosure may go for a bit higher at auction, suggest that your qualifying mortgage be a bit higher than your bank accepted offer so that you have the ability to up your offer if need be during the court auction.

Why do we do this?  Often purchasers will make a lower offer to the bank (or lender) in hopes that the court auction will be unsuccessful in finding a higher bidder and then the lender is forced to take the accepted offer.  But if another party - or perhaps several parties are also interested in the property then the bidding process starts and the highest bidder will prevail.

Why present an offer at all then?  All bidders must be pre-qualified prior to bidding.  So the lender must have an accepted offer from each individual who is interested in the property.  Court dates are costly and if un-qualified buyers were to out bid others and then not be able to come up with the financing, the deal would fall through and the lender would be out even more money on their already foreclosed on property.

Harmony Mortgage Group has facilitated financing for many clients that have chosen this non-traditional mortgage transaction successfully.  We understand the financial aspect of qualifying for a mortgage of this type of property and can guide you through the process.  We work with highly qualified people that specialize in this type of real estate purchase, like Kelly Johnston at Sutton Show Place Realty right here in Chilliwack.  With a team of professionals on your side it is much easier to be the successful bidder once you have decided on a foreclosure property.





Harmony Mortgage Group is home to Chilliwack's Top Mortgage Brokers. 

A Little Gratitude…..

December is a definitely a month of reflection and for us at Harmony Mortgage Group a month of gratitude.  Each December we take the time to look at the year past and are always inspired by all that we have accomplished and achieved but also by the amazing relationships we have built and all that we have received from our group of colleges, networks and friends.

This is year is no exception.  We have built on existing relationships and solidified new ones.  Harmony Mortgage Group has worked hard to build great relationships in Chilliwack and we want everyone we work with to know how much we appreciate them and all of their hardwork and trust in us.

Once again this December we, along with Ken Oldale from A Buyers Choice, co-hosted our annual Christmas Client Appreciation luncheon at Preston’s Lounge.   We have been doing this for sometime now and it has become a highlight for us each year as the number of invites grow and our Professional Family in Chilliwack expands each year.  This year all that were invited helped us raise over $500 for the Chilliwack Food Bank, not to shabby!

This year we have been so fortunate to have our office grow with the addition of two new Harmony Mortgage Group Brokers.  Tania Vermeer and Roop Virk are now a part of our team and we are very excited to work along side them and watch their careers grow in this industry.  Two great additions to our office.

As we grow our business here in Chilliwack it is not lost on us that we couldn’t be as successful as we have been without the support of our peers, family and colleges.  We don’t take any of the trust others have put in us for granted.  It is important to us to be able to express our gratitude to those that have supported us and to support them in return.

So as the year comes to an end we would like to say thank you to all of you that look to us as an integral part of your community, to those that have chosen to work with us and those of you that we have had the privilege to work with.  Thank you Chilliwack for making us your Top Mortgage Group in Chilliwack.  We are proud of being a part of this community and can not wait to see what 2015  brings.

 

Harmony Mortgage Group
Carie Pool
Tammy O’Callaghan

A Sense Of Community - Harmony Mortgage Group, Doing Our Part!

Harmony Mortgage Group has always been hands on within our community.  Tammy and I have always made it a priority to get involved and are naturally very outgoing people.  So when Jodi Derksen, wife of the head coach Mike Derksen for the Chilliwack Giants Football Organization, approached us about sponsorship it just made perfect sense for us to jump on board and support this worthy cause.

With an organizational motto “Training Athletes. Developing Individuals” Tammy and I  knew right away that the Chilliwack Giants Football Club was more than just an opportunity for youth to play a sport and blow off some steam.  The organization is committed to the great tradition of football and teaching life skills on and off the field.  They are as committed to building good character and confident youth as they are to the actual game of Football.  This organization understands that the two aspects go hand in hand as they support the athlete and individual at the same time.

Congratulations to the 2014 Raffle Truck winner Kristy Slykerman!

In their own words: The mission of Chilliwack Minor Football is to provide an environment for the youth of our community to participate in learning and developing both individual and team sportsmanship. It is our wish to allow those who participate in the sport to develop and play at a level consistent with their aspirations and to develop into the young men and women that both their parents and their community may be proud of. We hope to encourage and promote improvement in physical education, healthier life styles, and scholastic standings and standards.”

Tammy and I both being Moms we understand how important the two aspects of sport and individuals are and that one feeds the other.  So with the Harmony Mortgage Group Logo on the Raffle Truck this year and a commitment to hydrating all those athletes with a donation of water bottles we couldn’t be more proud to be a part of such a great asset to Chilliwack youth and the game of Football. 

Watch for us in the future as we continue to support great causes and local organizations like this one.

2013 CMFA Scholarship Winners

Post Secondary Funds Can Be Found In Your Home Equity

We have all heard it before.  Save for you child’s education.  Invest in a RESP.  Some of use do this, some of us start out doing this and life gets messy and you are unable for a while and then some of us just are not able and are busy paying for other things for their children at the time.

If you have managed to save for  your child post secondary education, well done.  If you have started or managed to put a little aside - great.  If you were unable for what ever reason, all is not lost.

Even those that have saved are not out of the woods yet.  With the rising costs of tuition and a Post Secondary Education you may find yourself short.  So even you need to know your financial options if your planning on helping your children with their chosen profession.

There are options for students; bursaries, student loans, part time jobs etc.  But one option you may not have thought of is your home equity.

Take a look at the chart below and see where you stand.

The numbers are staggering and they continue to climb. As your child heads off to college or university this year or in 2020 the fact of the matter is that it is not going to be cheap.

With mortgage rates at historical lows it may be that your best option is accessing some home equity to help with the burden of Post Secondary Education.  We are in a unique situation where our homes are gaining equity and market value quicker than in the past.  So, as you borrow from your equity right now, the market value of your home continues to rise and helps to offset the equity loan on your home.  It is kind of like a perfect storm so to speak.

For instance.  If you take out $100,000 (for ease of conversation) on your home at 2.25% 2 year term interest over 25 years your monthly payment is $435.61 per month

A loan at the same interest rate for  $100,000 over ten years is $931.37 per month for ten years

Take your home equity loan and ad an annual lump sum payment to it of $5949.12 each year (The difference between the traditional loan and the equity loan payment   $931.37 - $435.61 = 495.76 x 12 annual monthly payments) and you are able to pay down that principle without accruing interest and having to pay interest on that principle ever.  That is $59,491.12 that you will never have to pay principle on.  So effectively you are only paying interest on $40, 508.88. 

(These numbers are not exact as interest rates can fluctuate and it depends on your rate and your chosen rate of payment, this is just an example.)

Now there may be a penalty for paying out the equity loan early, and you would need to check with your mortgage broker to see if there are any annual limits etc on the mortgage you have chosen.  That said the penalty would be minimal compared to the savings in interest.

So if you own your home and your kids are off to Post Secondary this year or in the foreseeable future you may want to consider your equity in your home as a viable option to securing their future.  Who knows, you may need to go live with them one day and you need to make sure they have the means to take care of you. 

Renovate & Roll - Creating Your Dream Home Makes Financial Sense!

We have all done this, dreamt about upgraded appliances and how they would look so good in our dream kitchen.  While your at it you might as well do the addition and create that beautiful en-suite you have always wanted.  Then we stop ourselves and think wouldn’t it be nice,  if only I could afford it.

The truth is if you own your own home you probably can and the best part is that you will increase the value of your home.  If your dream home is one renovation away from reality Harmony Mortgage Group has got a smart renovation tip for you: 

“Renovate & Roll”
Roll the cost of your renovation into your mortgage for one easy monthly payment. You can then even use your prepayment features of your mortgage to pay it off faster. Depending on what you are renovating you may increase your homes worth substantially higher than what the market can yield in a given time.   For example if you do a $20,000 dollar renovation now as you continue to build equity in the home of your dreams your home will hold more value over the next 5 years than it would if you did not do the renovations.  So a home renovated now will yield a higher return based on the market than if you didn’t do the renovations.  In some cases the home that wasn’t renovated could lose potential value when it comes to resale.  In this case it would make financial sense to renovate your home to keep up with the market using our historically low interest rates.

Do the same over ten years and you would see an even greater difference as the renovated home will continue to hold value as the un- renovated home will begin to loose resale value due to the age of the home and higher cost of updating.

Mortgage Reno Refinancing:
When funding major renovations, refinancing your mortgage lets you spread repayment over a long period at mortgage interest rates, which are usually much lower than credit card or personal loan rates. This type of financing can allow you to borrow up to 80% of your home’s appraised value (less any outstanding mortgage balance). Initial set-up costs including legal and appraisal fees may apply.

Purchase Plus Improvements Mortgage:
If you’re planning major improvements for a home you’re about to purchase, it may be advantageous to finance the renovations at the time of purchase by adding their estimated costs to your mortgage. CMHC Mortgage Loan Insurance can help you obtain financing for both the purchase of your home and the renovations — up to 95% of the value after renovations — with a minimum down payment of 5%.

Many home buyers looking to buy older properties find themselves in a common predicament: they've found a property that suits them, but it needs some costly and immediate upgrades. Increasingly, buyers are adding the costs of those immediate renovations into their mortgage, instead of racking up credit card bills or selling investments to pay for the upgrades. Known as a "purchase plus improvements" mortgage, this type of mortgage covers the sale price of the home, plus any renovations that would increase the value of the property, with as little as 5 per cent down.
If you're buying a home but want to add a second storey, finish a basement or redo a kitchen, it can make a lot of sense to add those costs to your mortgage. That way you can spread your payments over the life of the mortgage and have a cost-effective way to get your dream home. The process is quite simple:
  
    •    Obtain cost estimates for the upgrades
    •    Get your appraisal - for the value of the property "as is" and the estimated value of the property           once the improvements are completed
    •    Renovation costs are included in your mortgage
    •    Complete your upgrades
    •    Renovation funds are released by your solicitor upon completion
     
With rates as low as they are right now is a good time to think about that home renovation.  In many cases It is more cost effective to renovate the home you are in to your liking than to purchase a different home with the same attributes.  This way it is done to your specifications, your budget and of course your needs. 

Bottom Line:
If you've owned your home for a few years, chances are you've been building up some nice equity.  With mortgage rates hovering around historic lows, this is a great time to look at rolling the cost of your renovation into your mortgage. In fact, you might find enough interest savings in your new mortgage to help knock down the overall cost.

Come and talk to us at Harmony Mortgage Group.  We have options that the banks can not offer and we work for you.  We can walk you through all of your options and help you make a plan to create the dream home you have been wanting.

Qualifying - The Difference Between Rate Holds, Pre-Qualifying and Pre-Approval

Being a part of the Real Estate Industry we often forget that the layman client might not understand some subtle differences in language that surround approvals, rate holds, pre-qualifying or a pre-approval. For instance, realtors who are asking their clients if they have financing in place and they say they are “pre-approved”, what does that really mean?  Do the clients know what that really means to them???? and are they really pre-approved or do they just have a quick look pre-qualification from their bank that didn't require income verification and credit checks.

The next question is how do you get your client to understand the difference and the importance of actually obtaining a pre-approval that requires documents to be submitted and a commitment from a lender that includes a rate and amount the client is qualified for based on actual numbers and credit bureau?

One place to start is by clarifying that they have submitted documents and have had a bureau report pulled with a definitive outcome.  The other is to explain that if they don't do this they could be disappointed if they find the house of their dreams and end up being turned down after a closer official look at their current financial status including T4's, employment letters, income verification, credit bureau and more.

Not to mention the time you as their realtor have taken to show them properties that might not be a reality for that client. Having to refocus your client after a disappointment can be a tough sell.

One of the ways Harmony Mortgage Group suggests and also works with clients is to educate the client on the language differences and what it means in terms of working with actual numbers and being qualified in a formal manner than in just a tentative way provided they can produce the documents required at a later date and meet the lenders income / credit ratio.

As a realtor the Approved Client over the Pre-qualified or Pre-approved client is a client that is ready to buy and has a formal committal from their lending institution and ultimately they are the most cost effective client for realtors to work with.

A typical conversation between a realtor and buyer is like this:
Realtor:  Do you have financing in place?
Buyer: Yes I have been pre approved for $XXXXX
Realtor: Great, lets go look at some properties.

A Preferred Conversation between a realtor and buyer:
Realtor:  Have you obtained financing?
Buyer: Yes I have been pre approved for $XXXX
Realtor: Great! Do you know if you have a formal pre- approval or a  pre- qualification?
Buyer:  I'm not sure, what is the difference?
Realtor:  Let me explain........

Harmony Mortgage Group works with realtors so that their clients are not disappointed when they find out that their pre-qualification or rate hold  doesn’t hold the merit they felt it did while house hunting.  It is a way to avoid messy real estate transactions that end up either falling through or running into complications.  It is our job to work with your clients as partners in this process and help them understand their lending parameters and for you as their realtor to work with them in confidence based on real numbers.  The best part is that we can get them several lending options that work with their lifestyle and needs.  It's not just about fitting into mortgage lending parameters, it is also about the mortgage fitting the buyers needs.  Not all mortgages are created equally and knowing how to sift through the language and world of finance is our job.  Helping your clients achieve home ownership with the best lending option available to them creates long term repeat clients for you as their realtor and for Harmony Mortgage Group as their brokers.  It's a partnership that works long term and creates sustainability for the future.

If a client has been formally pre-approved it is important to find out if the lender is acting on the best interest of the client.  The only way to really know if the client has been given the best rate is to let them know that a mortgage broker is independent of the banks or one specific lending institution and can shop many institutions on their behalf to make sure they are getting the best rate.  One phone call can let you know if your client has the best rate out there or if a mortgage broker can set them up with a lender who can beat the rate they have been give.  It is simple peace of mind!