Will A Down Payment Make A Good Wedding Gift?

Posted onJune 26/2015By

How many toasters does one couple need? The answer is probably one. If you have a close friend or family member who is tying the knot, you may be unsure what to get them. Nowadays, couples have been renting a home together for a few years prior to getting married. They already have toasters and other appliances so when it comes to setting up their registry people are choosing a different path: a down payment for their first home. It’s likely that you can’t pay for your friend’s dream house altogether, but you can get them one step closer to home ownership. This is called crowdsourcing or crowdfunding, and it’s becoming a less costly way to get newlyweds into their first home faster than before. Gifting a Down Payment: If your friends haven’t registered anywhere and are thinking of it, talk to them about how crowdsourcing can help bring them…

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What Is A Starter Home?

Posted onJune 22/2015By

If you’re looking to purchase your first home but aren’t looking to buy a five-bedroom palace, you could benefit from a starter home. A starter home is a smaller dwelling (like a two-bedroom house or condo) that is better suited to newlyweds and people just starting out. It is ideal for young people who are purchasing their first home because the smaller size of the home makes it less expensive to buy than a house with a many storeys, front and backyard, and two-car garage. The term “starter home” comes from the period following the Second World War where younger couples were looking to purchase a home to live in for a few years before they became parents and needed to move to somewhere that could accommodate their growing family. Additionally, people found it was cheaper to buy a small home than continue to rent their current apartment. In today’s…

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What are Cash Back Mortgages?

Posted onJune 19/2015By

When it comes to choosing a mortgage, there are many possibilities. A cash back mortgage is often recommended to first-time homebuyers because it gives you exactly what its name states: Cash back – money in your pocket to use as you please. How do cash back mortgages work? With a cash back mortgage you will need to come up with a down payment – like any other mortgage – but you will be entitled to a lump sum after your mortgage closes. What can I use my cash for? This is entirely up to you. Most people use the money to help them with moving, closing costs, land transfer tax, lawyer’s fees or renovations – basically things required to get them into their new home. How is the amount of cash calculated? The amount you receive is based on the size and term of your mortgage. This translates to roughly…

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Rental Properties: Are They Really Moneymakers?

Posted onJune 15/2015By

For those thinking of investing in a rental property, you may be making the right choice. Rental properties are bought or developed to allow you to earn income by renting them out to tenants. These properties are often known as non-owner occupied housing and can be viewed as a risk for some lenders. However, that doesn’t mean you shouldn’t take a chance on purchasing a rental property. There are many benefits to owning a rental property that lead to monetary gain for the homeowner. The property can become your lone source of income Depending on the number of tenants you have, this kind of property can quickly morph into great earnings. Yes, there are responsibilities that come with being the owner of a property like this, but being a landlord will allow you to be your own boss while creating the best living quarters for your tenants. As the property…

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How Will The Recent CMHC Changes Affect Mortgage Insurance Premiums?

Posted onJune 12/2015By

On June 1st, 2015, changes will be made to mortgage insurance premiums. This change will affect mortgages where down payments of less than 10% are made. Mortgage insurance lets Canadian homebuyers purchase their dream home with a lower down payment. Prior to the CMHC’s changes, you were able to purchase a home with as little as 5% down payment. Mortgage insurance is in place to protect the lender from any loses incurred such as borrower default and foreclosure. What do the CMHC changes mean for me? If you have purchased a home after June 1st, 2015 with a down payment of less than 10%, your insurance premiums will increase by approximately 15%. The Canada Mortgage and Housing Corporation calculates these premiums through a formula that uses your loan-to-value ratio. Because insurance premiums are usually attached to your monthly mortgage payments, this 15% increase will not make a huge dent to…

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