Real Estate Advisor with Engel & Völkers Dundarave, West Vancouver, Canada

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Should Your Clients Refinance Their Existing Mortgage To Invest In A Second Home?

should clients refinance their existing mortgage

Know the Pros and Cons Before You Make A Decision on Refinancing Your Mortgage

By Kara Kuryllowicz October 25, 2019

Everywhere you turn, there seem to be new options for what to do with your home equity. And of all the possibilities facing someone with equity, none are as exciting as the potential of investing in a second property.

But let’s not get ahead of ourselves. If you’re fairly new to homeownership, you might be asking,
“what even is home equity?” Essentially, home equity is the difference between what your home is worth in today’s market and what you owe against that home. In effect, equity is what you “truly” own in your property. Banks and lenders will allow you to borrow money against this portion you own, so you can use that money to invest elsewhere. For example, you could use the extra money to buy another property. 

This is where refinancing comes in.


How to Explain Mortgage Qualifying, Pre-Approval and Approval

Mortgage Pre-Qualification vs Mortgage Pre-Approval vs Mortgage Approval

What are the differences between each stage of the mortgage process?
By Kara Kuryllowicz September 18, 2019

how to explain mortgage qualifying pre approval and approvalIn early 2019, several Canadian banks launched digital apps that offer home buyers easy, hassle-free mortgage pre-qualification in 60 seconds or less. Sounds great, right?  The problem is many consumers believe a mortgage pre-qualification is a lot like a mortgage pre-approval or mortgage approval. As a result, prospective home buyers and sellers are left expecting the financial institution associated with the app to lend them hundreds of thousands of dollars, despite the fact they simply keyed their names, addresses, contact information and gross income into various online fields.

Getting Mortgage Approval

“Every week, as many as 40% of my new clients come to me because they’ve just bought a home and discovered that mortgage pre-qualification is meaningless and that they do not have the financing required for the purchase,” says Tracy Valko, owner and principal broker of Dominion Lending Centres Valko Financial Ltd., and a director at Mortgage Professionals of Canada.

Mortgage Rates Set For Modest Rise In 2016

mortgage rate forecast canada vancouver real estate While the benchmark qualifying rate for Canadian mortgages has not changed in eight months, offered or discounted mortgage rates at banks and other lenders have recently moved higher. The average 5-year rate offered by lenders has increased about 20 basis points in recent weeks to 2.79 per cent and the discount from prime lending rates on variable rate mortgages has narrowed from 60 to 40 basis points. Rather than reflecting changes in underlying economic factors, these increases are largely due to regulatory and other market structure changes that are pushing banks’ cost of capital higher.

Click here to see full mortgage rate forecast

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