Like the House but it needs work?? 

Has this ever happened to you?

You are house hunting. You have already determined your price range. Now you find a home you love, at the upper limit of your range, but it needs a new roof! You can swing the purchase financially, but you will have no cash left for the new roof.

Enter the Canada Mortgage & Housing Corp. (CMHC) Purchase Plus Improvement Program. This program, administered by CMHC but funded by mortgage lenders, will allow you to finance the purchase of your home plus the cost of future renovations, all in your original mortgage! These required renovations would be financed at the mortgage rate of interest, which is lower than the loan rate of interest. You would then spread the repayment of these renovations over 25- 35 years, the same as your mortgage, resulting in an almost negligible change in your mortgage payment. There is no change in interest rate. There is no change in CMHC Insurance Premium rate and only a minimal increase in down payment.

Here’s how it works;

• •      You put in your Offer to Purchase  a condition of financing showing… say a 5% down payment
• •      During the financing condition period you obtain bona fide written estimates for the work required… new roof say $5000
• •      This cost is then added to the Purchase Price
• •      You would need to increase your 5% down payment by $250
• •      The mortgage would be for 95% of the original Purchase Price PLUS the cost of the new roof.

Even though this program is available through CMHC, not all banks and mortgage companies participate. A Mortgage Broker will have the information you require and can arrange for a pre approval under this program. This will leave only the house to be qualified during the financing condition period.

For more information contact Karen Monteiro Mortgage Broker AMP at Karen@mrfinancial.ca who can give you guidance, and help you decide what’s right for your situation.

It has been an interesting year for mortgage rates to say the least. The Banks all encouraged people to lock in at the beginning of the year as they cried " Rates are on the rise" . We have seen an increase in the prime rate by 3/4 of a point to now sit at 3% but fixed rates, which run off the bond market, have actually dropped and are sitting at a low of 3.59% for a 5 year term and 2.90% for a 3 year term. Needless to say there are many angry people who listened to the banks advice and locked in at the higher rates offered earlier in the year.

Historically you are always a winner going with a variable rate mortgage but with fixed rates so low and prime on the rise , the fixed rates may just be the more the attractive choice for many home owners especially first time buyers. Qualifying now for a variable rate mortgage or a term shorter than 5 years will also dictate which route many people will go as it is harder to qualify for a variable rate mortgage since the rules chnaged in April of this year.

Either way you go make sure that you are getting good , sound , professional advice from a qualified Mortgage Broker as they work for you not the banks and can offer many more products then your bank can. They do a full preapproval for you not just a prequalification that the banks do to avoid costs. Make sutre that the Broker you choose has the designation of AMP which shows they are a part of a professional organisation and have taken extra training to provide competant service to their clients. Don't make the mistake of thinking a mobile mortgage specialist is a mortgage broker or agent as the specialist works for the bank and again can only offer what products the bank chooses to offer.

If you would like to speak with a qualified professional Mortgage Broker we offer in house services and can even do an online preapproval for you at www.homepreapproval.com call our office today to speak with Karen Monteiro Principal Broker with Mortgage Alliance Maximum Results Financial Services. 519-624-9222