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  • Home
  • About
    • Our Company
    • Our Team
      • Raquel Welch
      • Nancy Nairn
      • Guy Ferguson
      • Gib Hannah
    • Partners
    • Local Partners
    • Testimonials
  • Resources
    • Online Application
    • First Time Home Buyers
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4
mar
0

Avoid payment shock with our Inflation Hedge Strategy

Posted by Welch & Co, Mortgage ProfessionalsMortgage News!, Mortgage Tips, Understand MortgagesNo Comments

Say you get a mortgage with a five year term and a rate under 3% (as they are currently). What will happen in five years when you renew your mortgage? What will the rate be then?

 

Economists estimate that the interest rate will rise in five years up to as much as 5.5%. This means from one month to the next, at renewal time, you’ll experience what is called payment shock. This can be difficult on you and your family.

 

We at the Welch & Co. Team recommend adjusting your payments every year to match the current interest rate (keep in mind we offer free annual reviews!). The increased payments go directly towards your principal (thus actually paying down the mortgage) and will help you avoid payment shock.

 

This is also why the government, in 2018, introduced a stress test where you now have to actually qualify as if your rate was 5.19% (the Bank of Canada posted rate). This measure was taken in order to avoid potential future defaults on mortgages.

 

For example:

 

You get a mortgage loan of $250,000.00 at a fixed rate of 2.89% over five years (25 year amortization). This represents a monthly payment of $1,169.05 (excluding taxes). In five years, if economists are correct in their predictions, the same mortgage will cost you $1,525.98 a month. This represents a payment shock of $356.93!

 

However, after visiting the Welch & Co. Team for your free annual review, you’ve decided to increase your payment to match the payment associated with the 5-year fixed rate. In addition to preventing payment shock, you also benefit from a lower amortization and will save thousands of dollars in interest. Say you increased this same payment by only $40.95, your new amortization would be 23 years and 10 months and you would save $4,938.41 in interest!

 

Call us today to find out how you can utilize this strategy and see for yourself how you can avoid payment shock, reduce your amortization and save money, all at once!

24
apr
0

Pre-approvals – not worth the paper they are written on!

Posted by Welch & Co, Mortgage ProfessionalsMortgage News!, Mortgage Tips, Real Goods, Tips for Homeowners, Understand MortgagesNo Comments

Why do pre-approvals have such a bad rep? Realtors will often ask their clients if they are pre-approved, in order to ensure that they are not wasting their time showing the client properties for which the clients cannot qualify or cannot afford. But what, in fact, is a client getting, when they are pre-approved?

We at the Welch & Co Team, believe that pre-approvals are not worth the paper they are written on….

Here are some of the many reasons why we feel this way:

1) most pre-approvals are automated, which means that no underwriter is viewing the application: few and far between are the applications that are “vanilla” anymore, meaning employment as full time permanent salaried positions, with high end credit scores. All applications should be reviewed and underwritten in order for any pre-approval to be value.

2) if the application is for a purchase with < 20% down payment, the deal needs to be underwritten by both the lender and the insurer: even underwritten pre-approvals are not sent to the insurer for review.

3) pre-approvals do not taken into consideration the property, and a key part of the underwriting process includes the review of the property

4) most banks do not review documentation prior to issuing a pre-approval, which often leads to incorrect amounts in terms of capacity for the client (i.e. client says they make $50k per annum but are paid hourly – this means that a 2 year average has to be factored in and the 2 year average is in actuality $44k – hence their capacity to purchase would decrease substantially).

5) approximately 95% of pre-approvals do not reflect the lowest or best interest rate in the market place – rates can go up or down. Furthermore, not all lenders offer pre-approvals, and as such the client’s application may not even end up with the same lender with whom they were pre-approved!

6) not all of a client’s needs or goals are factored in when a pre-approval is issued.

What do we recommend INSTEAD of a pre-approval? At the Welch & Co Team, you will get full underwriting up front, of your application and documentation. If there are any issues that might affect your financing, you will know about them as well as the reason that they might be an issue. Each and every file gets our individual attention and is underwritten in order to ensure that there are no surprises! This is is also why we need all of your paperwork BEFORE we send in your application! Call us at 613-546-2989 to book your appointment today. We are ….More than a dotted line….

21
feb
0

Too Much Debt?!

Posted by Welch & Co, Mortgage ProfessionalsMortgage Tips, Real Goods, Tips for HomeownersNo Comments

5 signs you need help with debt

21
jan
0

Why use a Mortgage Broker?

Posted by Welch & Co, Mortgage ProfessionalsMortgage Tips, Understand MortgagesNo Comments

 

Article retrieved from Verico: The Mortgage Professionals, posted on November 30th 2017.

 

Mortgage rates and rules are continuously changing, and mortgage financing is therefore becoming more complicated. What was easily approved just a year ago may not be today. There is no better time to use a Mortgage Broker and benefit from our expertise and reputation to get the best deal for you. We search over 25 lenders promotions and products to get you the best rate, terms and options for your situation.  Get in touch with us today to speak to one of our experienced agents. 

 

 

A Mortgage Broker works for YOU, not the lender, and provides you with a choice of lenders, rates and products. Choosing the wrong mortgage can end up costing you thousands of extra dollars in penalties, fees and interest. Let us do the work and find you the best product for your specific situation.

 

 

We are relationship-focused, not transactional. Our brokers have been with The Mortgage Professionals an average of 10 years! That means that when you call us / text us / email us YOUR broker is available to answer your questions, not a 1-800 number and not someone who has never met you or who has just joined the bank. Many of our clients have dealt with us for more than 20 years, and some we are dealing with their children and even grandchildren!

 

 

Setting up multiple bank meetings during work hours could take you weeks to accomplish, and if you are not knowledgeable about mortgage terms and comfortable negotiating rates, you may not get the best term and rate to suit your needs. Let our seasoned mortgage brokers do the work for you and save you time and money.

 

 

Mortgage Brokers are focused on mortgages – not on trying to sell you 15+ other different banking products. Our focus is on researching almost 30 lenders’ products, special offers, and fine print so that we can ensure you get a mortgage that you understand, with no hidden fees or shocking penalties.

 

 

Are you looking to buy a future investment property? Do you have children approaching university? Want to finish your basement as a rental suite? Going back to school? Mortgage brokers tailor your mortgage to your long-term and short-term financial goals, taking into account mortgage products that maximize your financial savings and flexibility.

 

 

There is absolutely no charge for our expert advice and service on typical residential mortgages.  We are paid a finders fee directly from the lender and not by the person using the services of our Mortgage Brokers.

 

 

We are here to answer any questions after your mortgage has been funded.  Credit issues? Increased debt-load? You can expect our Mortgage Brokers to review your mortgage and finances regularly during your term to ensure your mortgage is still the right product for you and still competitive. At renewal time we will shop your mortgage again to ensure you are still getting the best offer at renewal – can you expect the same from your bank?

 

3
jan
0

Appraisals: The What, The Why, and The Who Pays

Posted by Welch & Co, Mortgage ProfessionalsMortgage Tips, Understand MortgagesNo Comments

 

Article retrieved from Verico: The Mortgage Professionals, posted March 28th 2018.

 

The What

 

An appraisal is used to determine whether a home’s sale price or estimated value is appropriate given the home’s condition, location, and features. The appraisal helps the bank protect itself against lending more than it might be able to recover in the case of default or foreclosure.

 

Most lenders have an approved list of vetted appraisers which must be used for the appraisal. Typically, an appraisal costs between $350 – $550.

 

The Why

Before requesting an appraisal, many lenders (and mortgage insurers) use automated evaluation tools, accessing market data (real estate sales data, MPAC assessments, etc..) to determine whether the value is accurate. However in some cases an appraisal is still required.

 

In a purchase, an appraisal might be requested under the following conditions:

 

  1. Private sale (e.g. not using a Realtor, ComFree, Property Guys, etc.)
  2. Using the same realtor for the purchase as for the sale
  3. Bank / Foreclosure sale
  4. The value of the house is significantly different that the surrounding homes

 

In the case where borrowers switch to another lender without adding money to the mortgage, typically an appraisal is not required.

 

With a refinance (e.g. where the borrower wants to add money to their existing mortgage), the lender in almost all cases will require an appraisal.

 

Who Pays

 

In a mortgage-insured purchase (where the borrower is putting less than 20% downpayment), if an appraisal is required, the insurer will typically pay.

 

If an appraisal is required for a purchase with more than 20% downpayment or a refinance, some lenders will cover the cost. However in some cases, the borrower will have to pay for the appraisal.

 

In a refinance, typically the borrower pays. However we do have access to lenders and special products where the appraisal is paid for.

 

How we can help

 

As Mortgage Agents & Brokers, we get as much information and documentation upfront about the borrower and the property to minimize the potential that an appraisal will be required. We also review all closing costs for purchases and refinances with clients to ensure that there are no surprise costs. Speak to one of our agents today about your purchase, refinance or renewal to find out your options!  

 

10
may
0

Bank of Canada Qualifying Rate Increasing!

Posted by Welch & Co, Mortgage ProfessionalsMortgage News!, Mortgage Tips, Rates Page, Real Goods, Understand MortgagesNo Comments

Lenders normally have until Monday, following announcements made by the Bank of Canada on a Wednesday, in order to implement the changes. The announcement for an increased Bank of Canada Qualifying rate was made yesterday – an increase from 5.14% to 5.34%.

 

This applies to all borrowers that have less than a 20% down payment for their home purchase…

 

Call us at 613-546-2989 should you have any questions at all!!!!

 

https://www.thestar.com/business/2018/05/09/bank-of-canada-raises-mortgage-qualifying-rate-following-increase-in-big-six-banks-fixed-rates.html

7
mar
0

What To Do If Your Employer Does Not Offer A Retirement Plan?

Posted by Welch & Co, Mortgage ProfessionalsMortgage TipsNo Comments

Article retrieved from Refresh Financial.

 

 

Canadians who are employed full-time typically have retirement plans built into their employment, and employers will often match your RRSP contributions as a benefit of your employment. However, that’s not always the case with some of us. If you’re working for an employer who does not offer a retirement plan, what are you supposed to do? If you’re wondering how you’re supposed to prepare, keep reading! We’re going to go over what to do if your employer does not offer a retirement plan.

At the end of the day, it’s your responsibility to save for your retirement, but these are some great tips you can utilize!

1. Aim To Save 15% Of What You Make

– Saving 15% of your income over the years will ensure that you have enough to live off once you are no longer working. 15% should be the bare minimum of what you end up saving for retirement.

2. Put Your Savings Into TFSA’s

– A TFSA is a tax-free savings account that Canadians can contribute up to $5500 per year. Try to hit that maximum every year.

3. Make RRSP Contributions

– Once you’ve maxed out your TFSA contributions, start making RRSP contributions each year. These contributions are tax-deductible and can help reduce taxes you may owe.

4. Get Educated On Investing

– Carve out some time for yourself to study how investing works. Speak with a financial advisor to discover the best route to making your money grow before retirement.

5. You Still Have A Canadian Pension Plan

– All working Canadians are eligible for the Canadian Pension Plan, which will help to replace your income once you retire.

It’s always nice to have the matched contributions from your employer, but if you don’t, it’s not the end of the world. There are still many avenues you can take on your own to ensure that your retirement transition is an easy one.

It may seem scary at first, taking that amount of money out of your regular monthly cash flow, but nothing is more valuable than your own peace of mind. Try and create a long-term plan for yourself. Document your plan and seek advice from professionals. If you’re including the steps above, you’re definitely on the right track!

What are your pointers for those who have to save on their own for retirement? Let us know in the comments!

25
jan
0

Borrowed Down Payment? Yes we can!

Posted by Welch & Co, Mortgage ProfessionalsMortgage Tips, Real Goods, Understand MortgagesNo Comments

Borrowed Down Payment Program

Did you know that it is still possible to borrow your down payment for your mortgage?!

Many folks think that this product is no longer available, however it is indeed! It is often misconstrued with another product: the 100% Financing Product, which is no longer available.

The key to the Borrowed Down Payment Product is that the lender must include the funds that were borrowed as a liability, as part of your application.

                                                                      For instance:

You borrow $12,500.00 towards your purchase of a $250,000.00

home purchase. The loan amount of $12,500.00 must be part of the

liabilities on your application: if revolving credit then you must input

a repayment amount of 3% of the $12,500 therefore $375 per month.

 

 

Although details vary from one lender to another, it may well be worth your while to inquire with the Welch & Co Team about this product! The most important items in order to qualify for this product are to have good credit, and to have room to add the additional debt to your list of existing debts!

Key Features of the Product:

Property related

  • 5-10% of the purchase price can be borrowed.
  • High ratio insurance premium is slightly higher at 4.5%.
  • >$75,000 <$500,000 purchase price
  • 1-2 unit homes maximum.

Purchaser related

  • No previous bankruptcies or consumer proposals.
  • Credit profile strong (>650 minimum).
  • Must have minimum two active trades for minimum two years.
  • Source of borrowed funds can be personal loans, lines of credit, credit cards, gifts from non-immediate family members.
  • Non-residing co-borrowers okay but no guarantors permitted.
  • Ratios of income to debt same as normal.
  • Borrower must be able to show that they have the ability to cover at a minimum the closing costs (1.5% of the purchase price)

 

 

Call us today to see if you might qualify for the Borrowed Down Payment Product at 613-546-2989!

23
feb
0
New house in Kingston. Get a mortgage today.

8 Things to Consider When Buying a New Home

Posted by Welch & Co, Mortgage ProfessionalsMortgage TipsNo Comments

Buying a new home is one of the most daunting experiences; yet it is one of the biggest milestones in life. It is easy to feel overwhelmed by this huge life decision and substantial financial investment. It is a significant commitment and requires careful planning and cautious choices. Planning is vital to the process, and while it will help you set your boundaries, it will also show you where you need to be flexible as you wade through the market.

Read More

7
jun
0
mortgage-renewals

How Credit Score Affects Mortgage Applications: 3 Experts Tell All

Posted by Welch & Co, Mortgage ProfessionalsMortgage TipsNo Comments

Q: Which is more important, credit utilization or credit-­to-­income ratio?

Right now I earn $60,000 per year and have access to three credit cards with a combined limit of $20,000. I have no other loans or debts and my current credit score (based on a FICO calculator) is about 720. I ask, because I’m starting to look at buying a house, and want to know what lenders consider as a more important ratio? Also, is it possible to better my credit score by reducing my credit utilization (which I would do by cancelling one credit card or asking for a lower limit)?

Read More

12
feb
0

9 Ways to Help Pay Off Your Mortgage Faster

Posted by Welch & Co, Mortgage ProfessionalsMortgage TipsNo Comments

Purchasing a home is an exciting milestone in the lives of many people. For some it means freedom, for others it means independence, but for almost everyone it means mortgage payments and intimidating debt. Don’t let the financial worry keep you from taking this next step in your life. Considering these tips can help reduce the financial burden sooner, and get your mortgage paid off ASAP.

Read More

4
feb
0
Advantages of using a mortgage broker

4 Reasons a Mortgage Broker is Your Best Option

Posted by Welch & Co, Mortgage ProfessionalsMortgage TipsNo Comments

With so many options, deciding on the best way to finance your home can be stressful and overwhelming. One of the first decisions that should be made is whether you would like to go through a banking institution or a mortgage broker. If you are finding yourself stuck on this decision, here are 4 reasons why choosing to work with a mortgage broker can benefit you, your credit, and your bank accounts.

Read More

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Address: 775 Blackburn Mews, Kingston ON K7P 2N5
Phone: 613-546-2989
Email: welchco@mtgprof.com

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Raquel Welch: #M10000573
Nancy Nairn: #M08002086

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