If you’re interested in buying a vacation home, there is a lot to consider. A good first step to purchasing any vacation home is to think about your 5- and 10-year plan. Will you get enough use out of it? Do you have other more immediate or important financial goals? What’s the opportunity cost?
If you’re set on the vacation home, but don’t plan on paying cash for the property, the next step will be to plan how to finance it. Here’s what to ask yourself:
Do you have enough saved for a downpayment? A second property could need anywhere between 5-20%+ downpayment. Some factors to consider are if it’s winterized, mortgage insurance requirements in relation to the purchase price, etc.
Can you afford the purchase? Your income will have to be such that you can take on the additional debt, so consider calculating your debt servicing ratios and see how much room you have within your current situation. You can use the stress test feature in my mortgage app (hyperlinked in email) to get an estimate on what your income will allow you to qualify for - or just ask and I’m happy to run the numbers for you.
Will the location/property be eligible for financing? Remote locations or properties outside Canada may not qualify for a mortgage, so you might need to get creative.
Will it be owner-occupied or an investment property? Depending on who lives in or uses the dwelling, there will be different mortgage and tax implications.
If you’re in a good place to move forward with purchasing a vacation home, the next step is selecting a location. A few considerations:
Another big factor in purchasing a vacation home is deciding what will happen to it while you’re not there. Will you rent it out? Will you have a property manager? What’s needed to keep the insurance valid on the property?
If you’re not sure about any of what you’ve just read, a great first step is to get in touch! As your mortgage broker, I can help you calculate your debt servicing ratios, determine what you’re eligible for, and come up with creative financing solutions if needed. We can look at second mortgages, reverse mortgages, and other options to get you into the property of your dreams.
Summer in Canada goes by fast! Make the most of it by spending time in your outdoor space. There are plenty of projects you can undertake to help you enjoy the space you have even more, whether it’s a small patio or a big yard. Here are some suggestions!
For Patio Space Only:
For Small Yards:
For Big Yards:
Not enough inspiration here to quench your outdoor project thirst? Take a look through Home Depot’s backyard ideas, complete with materials and DIY instructions to make them happen.
I hope you’re able to get outside and enjoy the nice weather while it lasts. See you back here in August!
Finding your dream home can seem like a daunting task. But don’t despair! Here are five actionable steps to set you up for success.
When you’re ready to make a move, I’m here for you. Give me a call to help you with the practicalities of financing so you have a successful hunt for that dream home.
We all love a nice, air-conditioned home on the hottest days of summer, but no one looks forward to the bill for it. Here are a few ways to stay cool without shelling out the big bucks.
Tactic 1: Minimize Heat Sources
Tactic 2: Lower Your Energy Usage
Tactic 3: Switch to an Evaporative Air Cooler
Evaporative air coolers (or swamp coolers as they are sometimes called) lower the temperature by moving hot air across water. As a fan blows the air across a water reservoir, the air picks up small water particles which evaporate as they are blown away. The evaporating water cools the air nearby the same way drying sweat cools people down. Here’s what else you need to know:
And that’s it for the June newsletter. Enjoy the start of summer and I look forward to seeing you back here next month.
Many homeowners—especially those without a mortgage broker—don’t fully understand mortgage penalties. And I get it! Financing a home can be overwhelming. But if you're considering refinancing, selling, making a lump sum payment, or need a way out, read this first.
The most common mortgage penalty my clients encounter is a prepayment penalty. Did you know? Your lender doesn’t want their money back early! That’s because they earn guaranteed interest on the loan, helping them not only budget but also profit. Let’s go over the types of prepayment penalties:
Prepayment or Overpayment: If you make a lump sum payment on your mortgage or increase the regular payments by too much, you could be outside the terms of your mortgage agreement.
Transferring: If you move your mortgage to another lender before the end of your term, that is considered breaking the mortgage agreement you made.
Early Re-Payment: If you sell your home and pay off your lender with the proceeds, leaving you without a mortgage, that also breaks the agreement.
Breaking your mortgage for these—or any other reason—almost always results in financial penalties. The amount of the penalty that could be owed will be based on a few factors:
The simplest answer is to wait until the end of your existing term to make changes. If that’s not possible, let’s review your circumstances:
There’s also a flip side to penalties, which involves incurring a penalty because you’re making a late payment or missing payments.
You won’t be surprised that any payment received after the due date will incur a fee. Lenders will also report the missed payment to the credit bureau, which will impact your credit score. Before you miss a payment, the best thing you can do is to notify your lender (especially before it happens) and let them know. You can work together to defer a payment, skip a payment, or make other alternative arrangements.
If you’re with a lender that offers it, consider taking a ‘mortgage payment holiday’ and either skipping or deferring payments for a specific amount of time. Some lenders allow up to 3-6 months or possibly longer, depending on the circumstances.
If you have already missed a payment, you should make up that late or missed payment as soon as possible to avoid a quickly escalating situation.
It is important to note that sometimes, paying a penalty can be worthwhile—especially if you're locked into a higher-rate mortgage and the savings from breaking it and securing a lower rate outweigh the penalty costs. I can help you with this determination! I can help you determine if this makes financial sense for you.
If you’re likely to break your mortgage agreement, consider an open mortgage. This is a great short-term solution for anyone who has an inheritance coming up, is planning a move out of town, or perhaps getting married (or divorced) and planning to combine (or separate) assets. You regularly pay the mortgage as long as you need it, but when you sell the property—no worries. This option does typically come with higher rates, but the benefit is that there are no penalties to pay it off at any time.
Whatever type of mortgage penalty you might be facing, my best recommendation is to talk to me for expert advice. Do this before you make any commitments so we can go over the fine print and you can understand what you’re getting into! I always take the time to do this with my clients, and I would be happy to assist you also.
“Spring has a way of bringing everything back to life, even a broken heart—or a dated, messy house.” ~ Willie Nelson (roughly interpreted)
Home Upgrades to Boost Your Property's Value
Spring is typically a busy season for the housing market in Canada. Whether you’re looking to sell or help your home bloom where it’s planted, these value-add ideas will be worth putting on your to-do list. We’ve sorted the chores by cost so you can consider your budget first and foremost.
Now, let’s get to work!
Under $100
Perhaps the best bang for your buck is to focus on the front of the house. A few inexpensive ideas are to paint the front railing, upgrade the mailbox, or change the numbers on your house. You’ll also get a lot of value from some yard maintenance, like raking, picking up the pinecones, cutting the grass, or planting a few flowers. Do you know why flowers are so popular? They have a lot of buds. ��
Looking at the inside of the house, something almost all of us could benefit from is decluttering. Go through kitchen drawers and cupboards, closets, and even review the décor in your home. If you still have one of those tall vases with some wheat coming out of it, it’s time to let that go. While you’re scrutinizing every nook and cranny, make sure all the lightbulbs work—and replace any that are burnt out.
Under $500
This budget can get you pretty far if you’re willing to DIY some projects. For example, you could get some paint and supplies and paint a whole new colour into your home. Start with a room or even just an accent wall to make the project more manageable. Another option is to put a firepit in your yard. Seeing and using the space in a new way might make you fall in love with the home all over again.
Another option is to tackle some small upgrades, like new knobs on the kitchen drawers, replacing a toilet seat with an upgraded bidet, or even installing a new light fixture that brightens up a room. Some door handles might need replacing or you may even want to add some curtains or a window treatment to the most used rooms in your home.
Under $1000
Perhaps the biggest suggestion in this category is a professional cleaner. Having someone come in and truly scrub the baseboards, inside the oven, and all those other sneaky little places will make your house look instantly better. Be sure to make a list of what needs the most attention and prioritize the tasks when you hire the cleaner. You could also get your carpets professionally cleaned – they’ll both look and feel much better.
Another idea is to add some tech into your home, like a smart thermostat, lighting, or a camera-based security system. These can be relatively easy to install on your own which is a great way to save some money.
Under $2500
We’re going to start with an interesting one here, which is to upgrade your front door to a steel door. Based on the numbers online, you’ll make back 188% of the value at resale, so think of it as an investment.
If you’ve got hardwood floors, getting them refinished will make a big difference aesthetically in your home. If that’s not a direction you want to go, you could also upgrade the space with a high-quality area rug.
Under $5000
The first suggestion is to upgrade your bedroom closets to custom designs. Make the space more functional for the clothes, shoes, and accessories you have. It will not only make getting dressed easier, but the entire space will be easier on the eyes.
The second suggestion is to install a new garage door. Whether it’s a newly automatic door or simply a better-looking replacement, a new garage door has been shown to recoup 194% of its cost at resale. And if resale isn’t the direction you’re going, you can still use the new door and have your property looking better quickly.
Unrestricted budget
This next section is something you’re almost certainly better off hiring a professional to tackle. These are much more time and labour intensive, so be sure to research the cost and get quotes from professionals before launching into any of them. Here are a few suggestions:
Replace the roof. Speaking of roofs, do you know why the roof went to the doctor? It had shingles.
Redo the kitchen to modern design with new appliances like a gas stove, convection oven, double dishwasher, tech-heavy fridge, or other things you’ve had on your bucket list
Add an addition to the home with an office space
Replace windows with energy efficient ones and include window dressings
The bottom line here is that no matter how big or how small your budget is, there are plenty of things you can do to spruce up your home and either enjoy it more yourself or increase its value to a potential buyer.
Spring is one of the busiest seasons in the real estate market, with buyers eager to find their dream home before summer.
If you're planning to purchase a home in Spring 2025, now is the time to get your finances in order. Being financially prepared can help you secure a mortgage with favorable terms and make your home-buying journey smoother. Here’s how to get ready:
Your credit score is one of the most important factors in mortgage approval, influencing both your eligibility and the interest rate you’ll receive. A higher score can save you thousands over the life of your mortgage, so it’s worth taking the time to improve it.
Start by checking your credit report for errors, and if you spot any inaccuracies, dispute them immediately.
Pay down outstanding debts to lower your credit utilization ratio, which plays a big role in your score.
Avoid opening new lines of credit in the months leading up to your mortgage application, as this can temporarily lower your score.
By reaching out to me, I can help preserve your credit score as they will pull your credit report once to shop your application. Note: Multiple credit checks in a short period can lower your credit score.
The more you can put down up front, the better. A larger down payment can reduce your monthly mortgage costs, give you access to better loan terms, and, in some cases, eliminate the need for mortgage insurance.
Set a savings goal based on home prices in your target area so you have a clear plan.
Explore first-time homebuyer programs that offer down payment assistance—there are plenty of government and lender-based options.
Make saving a habit by automating deposits into a dedicated home savings account.
Avoid moving your money around to multiple accounts prior to applying for your mortgage. Lenders require a 90-day history of your down payment and a history of moving your money around can make this more difficult to easily verify your down payment.
Lenders use your debt-to-income ratio (DTI), aka GDS/TDS, to assess how comfortably you can handle a mortgage payment on top of your existing obligations. A lower DTI signals financial stability, improves your chances of loan approval and can expand your borrowing power.
Work on paying off high-interest debts or debts with high monthly payments, like credit cards and personal loans, to free up more of your income.
Hold off on making large purchases or taking on new loans, such as car financing, before applying for a mortgage.
If possible, look for ways to increase your income—whether through a raise, side gig, or freelance work—to strengthen your financial standing. Note self employed income or part time non guaranteed hours employment generally require a 2-year history.
A mortgage pre-approval is a game-changer in a competitive market. It gives you a clear budget, shows sellers that you’re a serious buyer, and can even speed up the closing process.
Start gathering essential documents like tax returns, pay stubs, and bank statements—lenders and myself will need these to assess your financial health.
Reach out to me today for information to help you compare mortgage rates and terms, ensuring you get the best deal.
Take time to discuss your mortgage options with me, from fixed to variable rates, different term lengths, or special programs available to you.
The home price isn’t the only expense you’ll need to plan for. Homeownership comes with extra costs that can catch buyers off guard if they’re not prepared.
Closing costs typically range from 1.5% to 4% of the home’s purchase price, covering legal fees, land transfer taxes, and more. This is money you need on top of your down payment
Property taxes, Condo fees and homeowners' insurance can add to your monthly expenses—make sure to factor them into your budget.
Set aside a fund for home maintenance and emergency repairs to avoid financial strain when unexpected expenses arise.
Spring is a competitive time to buy, so being well-informed about the market can give you an edge.
Keep an eye on housing prices in your preferred neighborhoods to understand trends and pricing expectations.
Stay updated on current interest rates, as they directly impact affordability and your monthly payments.
Work with a trusted real estate agent who can help you navigate bidding wars, negotiate offers, and find the right home for your needs.
Interest rates can fluctuate, and even a small increase can affect your monthly payments. If rates are expected to rise, securing a lower rate in advance could save you money over time.
Ask me about rate lock options and how long they’re valid for. Rate holds on average are valid for 120 days before they expire and a new rate hold period is requested
Compare fixed and variable rates to see which aligns best with your financial goals.
Keep an eye on Bank of Canada rate announcements and economic trends that could impact mortgage rates. Note: With recent Bank of Canada announcements variable rates which are tied to Prime are dropping
Taking these steps now will set you up for success. The more financially prepared you are, the smoother the process will be—and the better your chances of landing your dream home at the right price.
One of the biggest benefits to purchasing your own home is the ability to build equity in your property. This equity can come in handy down the line for refinancing, renovations, or taking out additional loans - such as a second mortgage.
A second mortgage refers to an additional or secondary loan taken out on a property for which you already have a mortgage. Some advantages include the ability to access a large loan sum, better interest rates than a credit card and the ability to use the funds how you see fit. However, keep in mind interest rates are typically higher on a second mortgage versus refinancing and can add additional cash flow tension to your monthly bills. Talk to a mortgage professional today to determine if this is the best option for you!
First things first, a second mortgage refers to an additional or secondary loan taken out on a property for which you already have a mortgage. This is not the same as purchasing a second home or property and taking out a separate mortgage for that. A second mortgage is a very different product from a traditional mortgage as you are using your existing home equity to qualify for the loan and put up in case of default. Similar to a traditional mortgage, a second mortgage will also come with its own interest rate, monthly payments, set terms, closing costs and more.
As both refinancing your existing mortgage and taking out a second mortgage can take advantage of existing home equity, it is a good idea to look at the differences between them.
Firstly, a refinance is typically only done when you're at the end of your current mortgage term so as to avoid any penalties with refinancing the mortgage. The purpose of refinancing is often to take advantage of a lower interest rate, change your mortgage terms or, in some cases, borrow against your home equity.
When you get a second mortgage, you are able to borrow a lump sum against the equity in your current home and can use that money for whatever purpose you see fit. You can even choose to borrow in installments through a credit line and refinance your second mortgage in the future.
Some key things to note when looking at a second mortgage or refinancing:
If you have a favorable interest rate on your first mortgage, a second mortgage allows you to keep the lower rate on your primary loan, resulting in a lower blended rate.
Refinancing resets the amortization schedule, which could extend the loan term. A second mortgage leaves the existing term intact, helping you stay on track with your overall financial goals.
Second mortgages often come with more flexible terms, such as interest-only payments, fully open, or shorter term, which can suit your immediate needs.
There are several advantages when it comes to taking out a second mortgage, including:
Homeowners can access a significant portion of their home equity (typically 80%-85% LTV).
Better interest rate than a credit card as they are a ‘secured’ form of debt.
You can use the money however you see fit without any caveats.
Allows you to access your home equity without breaking your existing mortgage and incurring penalty fees.
As always, when it comes to taking out an additional loan, there are a few things to consider:
Interest rates tend to be higher on a second mortgage than refinancing your mortgage.
Additional financial pressure from carrying a second loan and another set of monthly bills.
Before looking into any additional loans, such as a secondary mortgage (or even refinancing), be sure to reach out to me!
Regardless of why you are considering a second mortgage, it is a good idea to get a review of your current financial situation and determine if this is the best solution before proceeding.
As the days grow longer and the sun shines brighter, it's the perfect time to refresh your home with a thorough Spring clean! A clean, organized space can help you feel more energized and ready to embrace the season ahead.
Here are some tips to make your Spring cleaning both efficient and enjoyable:
Embrace these tips, and your Spring clean will leave your home feeling fresh, organized, and ready for the new season!
