WHAT IS AN UNINSURABLE MORTGAGE?

blog Wu Liu 劉武 19 Mar

With the mortgage rule changes in recent years, lenders have had to make some adjustments to their rate offerings.

There are different tiers and rate pricing based on the following 3 categories:
1) Insured – a mortgage that is insured with mortgage default insurance through one of Canada’s mortgage insurers, CMHC, Genworth or Canada Guaranty. A mortgage insurance premium based on a percentage of the loan amount is added to and paid along with the mortgage
2) Insurable – a mortgage that may not need mortgage insurance (20% or more down payment) but would qualify under the mortgage insurers rules. The client doesn’t have to pay an insurance premium but the lender has the option to if they choose.
3) Uninsurable – a mortgage that does not meet mortgage insurer rules such as refinances or mortgages with an amortization longer than 25-years. No insurance premium required.

Insured mortgages are the safest type of mortgage loan for the banks and the most cost-effective way of lending mortgage money, so clients seeking or in need of an insured mortgage will get the best rate offering on the market.
Insured as well as Insurable mortgages can be bundled and sold as Mortgage Backed Securities (MBS) meaning banks can get that money back quickly so they can lend more out. While Insured mortgages get the best rates, Insurable mortgages are typically a close second.

If a mortgage is Uninsurable that means the banks have to lend their own money and have to commit to that loan for the full term at least. This makes it a more expensive loan for the bank, so they pass the cost on to the consumer as a premium on the rate – typically 10-20 basis-points.

While there are rumours that the Government may start to allow refinances and 30-year amortizations to be insured again, no formal announcements are expected in the next few months.
In the meantime, consumers looking to tap into the equity they’ve built (consolidation, investment, home renovations) or wanting to keep their payments as low as they can (30-year amortization) are paying the price.
If either a refinance or a longer amortization is something you are considering, it’s wise to have a free analysis of your mortgage done so you can make an informed decision. If you have any questions, please contact DLC mortgage broker Wu Liu. THanks

TRANSFERS AND SWITCHES

blog Wu Liu 劉武 19 Mar

Transfer/Switches are when you opt to transfer your mortgage to a new lender in order to take advantage of a lower rate. A transfer/switch does not include additional money to the existing mortgage balance owing, your mortgage amount will remain the same, however lenders will allow you to increase the mortgage up to $3,000 to cover legal costs, possible appraisal fees and if applicable, penalty fees – more on that below.

*Note: If you do require new money or funds (more than $3,000.00) this would then be considered a refinance.

There are two scenarios where you would utilize a Transfer Switch:

1. When your mortgage term is up, and the mortgage is renewing with your existing lender. If you choose to transfer/switch your mortgage at renewal you will not have to pay a penalty. You will still need to qualify and there may be legal and appraisal costs associated with the transfer/switch, just as you would with a new mortgage. However, many lenders offer you the option to include the legal and appraisal fees into you new mortgage and some lenders may cover these costs for you.
2. The second scenario you may choose to do a transfer/switch is when you are in the middle of the term of your mortgage. The only reason you would do this is to take advantage of a lower rate which means a lower monthly payment. This would have to make sense financially for you to do as you will have a penalty associated with breaking the current mortgage.

If your mortgage is up for renewal, or if you are considering a transfer/switch in light of recent rate changes, a mortgage broker can assist you in making the right decision. Similar to when you first financed your mortgage, having a broker assist you gives you:

A DEDICATED INDIVIDUAL SHOPPING FOR YOU:
Reputable brokers have your best interest in mind first!

Your mortgage professional will shop the market to find the best overall cost of borrowing for the client. Broker’s will look at all angles of the product to ensure that the client is getting one that will suit their unique and specific needs. Not once will the client be expected to shop their mortgage around or to speak to the lender.

ACCESS TO THE BEST RATES & PRODUCTS
A mortgage professional has access to:
• Tier 1 banks in Canada
• Credit Unions
• Monoline Lenders
• Alternative Lenders
• Private Lenders

This extensive network of lender options allows brokers to ensure that you are not only getting the sharpest rate, but that the mortgage product is also aligned with the client’s needs.
Now, a few details that you should know before you transfer/switch your mortgage:

YOU WILL HAVE TO SUPPLY DOCUMENTS
Just like when you went through the process the first time, you will have to supply documents to the new lender in order to transfer/switch.

YOU MAY HAVE TO PAY OUT CERTAIN COSTS
As mentioned above, there costs associated with your transfer/switch. If your mortgage is up for renewal and you are opting to transfer/switch these may include admin and legal fees. If you are opting to transfer mid-term to take advantage of a lower rate with a different lender, these may include your penalty and legal/admin fees. However, many lenders will offer up to $3,000 financed into your mortgage to assist in covering these if applicable

YOU WILL HAVE TO QUALIFY UNDER CURRENT REGULATIONS
With a transfer/switch, you are required to pass any and all regulations and stress testing measures may be applicable, however If you are looking at a transfer/switch and your previous mortgage funded prior to November 30, 2016 old mortgage rules apply (no stress test is required). This means
• You are grandfathered in previous under mortgage rules
• You can qualify at the contract rate rather than the stress test of contract rate plus 2% or the benchmark rate (currently at 5.34%)
• In simple terms: no stress testing required.

Before you consider moving, you should run through the numbers with a broker and ensure you qualify. To find out more about stress testing measure, click here.

UNDERSTANDING YOUR PENALTY
If you are switching/transferring mid-term a penalty will apply to your mortgage. To find out what that penalty will look like, you can check out our article here, but we also encourage you to speak to your Dominion Lending Centres mortgage broker and have a clear understanding of what you will be paying out. If you are up for renewal and are looking to transfer, you will not have to pay a penalty and may or may not have the aforementioned fees associated with setting up the new mortgage with a new lender.

Remember, a broker is there to work with you to determine if a transfer/switch is right for you and to help you establish which lender will give you not only the best rate, but the most suitable mortgage product too!

又到一年报税季 报税与贷款有啥关系?

blog Wu Liu 劉武 3 Mar

在加拿大,报税与贷款息息相关。一方面,报税的收入直接影响了个人可以贷款的额度,另一方面,贷款的利息又影响了每年报税的抵税部分。大部分人都知道,报税越高,对贷款越有利;用于创造收入的贷款利息部分,可以帮助抵税。

如何利用贷款来抵税,这是税务专家的问题。而对于贷款专家而言,一个有良好报税记录的客人,更有可能申请到好的贷款方案。那么,到了报税季,有贷款计划的人士应该如何考虑自己的报税问题呢?

在加拿大,要成功获得银行贷款,第一要素就是收入。而银行如何衡量一个人的收入,则主要是看税单Notice Of Assessment, T1 General, T4A 或 T4这些文件上面的数据。这也是为什么许多客户现金收入很多,投资很多,但是却难以获得贷款的原因。

在我们接触的客户当中,经常踩到报税雷区导致贷款无法达到自己预期的几个重要因素如下:

01 投资收入较高,工作收入较少

在报税的时候,如果客户的收入大部分为资本利得Capital Gain,难以证明这个收入的可持续性,那这部分资本利得的收入也有可能不会被银行所认可,无论是在个人报税还是在企业报税上都是一样。曾经有一个案例,客户通过自己的企业的报税,来辅助证明自己的收入,但是由于Financial statement(公司财务报表)上面显示short-term investment(短期投资) 的收入部分有将近20万,导致了银行认为收入不可持续,因此拒掉了这个单子。可见,短期不可持续的收入属于贷款审核中收入的灰色地带。而实打实的可持续的工作收入,才比较容易被银行所认可。

02 收入忽高忽低

贷款的时候,银行往往需要看过去两年的收入水平,也就是说申请人需要提交两年的税单来证明自己的收入状况。倘若有一年的收入相对过低,而且没有合理的解释,也会拉低整体的收入水平。尤其是自雇的人士,收入相对来说不太稳定,银行更需要看两年的收入文件,包括两年的Notice of assessment, T4A, commission slip等文件来反复证明确认收入状况。因此,有贷款需要的人士,也要结合自己以往报税的情况来推敲自己今年应该如何报税。而对于转行的人士,如果只是跳槽还好,但是如果直接换了行业,比如说从餐馆打工换到了金融分析师,或者是从非自雇转成了自雇,那么收入的可信度就会降低,贷款的难度就会增加许多。

03 租金收入的核算问题

关于租金收入的问题,可以说每个银行不同的政策,对租金这块的核算是各有不同的。如果客户想要通过租金收入来支撑自己的收入状况,最好先和贷款经纪问清楚,自己有可能走哪个银行,会运用到什么样的政策,需要在报税上如何体现自己的租金收入。一味的报高收入是没有意义的,因为银行也有详细的政策和方法去核实收入的可持续性和真实性。针对租金的收入这一项,有些银行甚至会在估价的时候加入market rent(市场租金估值)这一栏目,因此无论客人报税报租金收入有多少,银行也会用估价师所提供的market rent来作为参考的基准。

更多贷款资讯,请拨打 778-686-2058 贷款专家 劉武

房贷局贷款新方向:自雇人士获得更多贷款渠道

blog Wu Liu 劉武 3 Mar

在温哥华的贷款市场上,自雇人士并不是“贷款红人”。所谓“贷款红人”,就是相较起一般人士,更容易拿到贷款的人群。过去几年间,例如新移民,非居民,都是所谓的“贷款红人”。但是随着近期银行的政策调整,过去的“贷款红人”越来越难拿到贷款,而加拿大房贷局(CMHC)则在去年10月1日推出新政,放宽自雇者的贷款条件。

目前最新的新政策下,自雇人士首付20%以下,并接受CMHC房贷违约保险利率,或者首付20%以上,并接受银行违约保险利率的,都可以按揭贷款买房。据悉,这一规定是为了响应联邦政府10年400亿可负担住房计划。

在以前,自雇不到24个月,要拿到贷款相当困难。在目前的政策下,银行可以了解客户是否已经有了成熟的生意,是否有足够存款或者其他收入,拥有什么样的机构和资历等等。这些都能够为客户争取更多的贷款,更低的利率。

此外,申请贷款的时候,除了原本的Notice of Assessment(退税单)之外,还可以追加T2125生意或者其他收入报表来作为收入的证明,证明自己的收入和还款能力。

考虑到目前自雇人士占加国人口的15%,CMHC首席商务官布尔斯(Romy Bowers)表示,加拿大自雇人士是本国劳动力的重要组成部分。新的政策变化,是通过让身为自雇者的借方更容易获得CMHC的房贷保险,并受益于有竞争力的利率,以迎对现状。

如果有任何自雇贷款的问题 请联系 贷款专家 劉武 778-686-2058