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A podcast hosted by mortgage broker, Marko Gelo. Born and raised in Calgary, then moved to Vancouver in 2011. Owner of dually licensed mortgage brokerage, Home Financing Solutions Inc. (a franchise of The Mortgage Centre). Mortgagenomics focuses on economics, real estate and feature segments on mortgage qualification strategies and policies. To make things a bit more interesting, Marko produces all the music tracks for the podcast. Songs are typically 1-3 minutes in duration, but may also fe ...
 
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Pre-episode Talk (up to 11 minute mark): Modern Monetary Theory, Canada's inflationary path, and my thoughts on how to position yourself on the right side of a volatile economic environment. Episode Notes: Down Payment Sliding Scales: Over the years down payment guidelines have inserted a component within the qualification criteria known as "slidin…
 
With real estate prices soaring across the country many applicants are seeking assistance when it comes to qualifying for a mortgage. More commonly, the assistance comes in the form of gifted down payments from the Bank of Mom & Dad, but coming in a close second these days is the addition of applicants to help combat the rigid income qualification …
 
If you're about to secure a mortgage, here's something you might want to consider regardless of whether it's a purchase, refinance or renewal. Make the mortgage readvanceable. What does readvanceable mean? Firstly, a readvanceable mortgage starts out as a typical mortgage where a specific portion of your payment goes towards the interest charge and…
 
Why are personal income tax documents required when qualifying for a mortgage? In most cases, personal income tax documents are required particularly when qualifying self employed applicants. But over the past few years, the Canadian mortgage underwriting standards have increasingly expanded upon its qualification criteria. As a result, the request…
 
If the banks say no, what is your Plan B? (and yes, there is also a Plan C) For most Canadians the end game to qualifying for a mortgage is landing with one of Canada's Prime lenders (also known as the Big 5 or 6). And along with that comes the satisfaction of defeating/fulfilling the sometimes (or more like, everytime) extraneous qualification gui…
 
With over 300,000 new residents arriving to Canada (and about 400,000 expected on an annual basis for the next 2-4 years), Canada's banks have been continuously altering and modifying their lending guidelines to accommodate for immigrant-friendly mortgage qualification programs. Today, I want to talk about mortgage qualification for temporary resid…
 
A mortgage refinance is often a momentous and rejuvenating experience. For most homeowners it's an opportunity to reset and forge a new pathway to a more promising outcome (i.e. paying off high interest debt with low interest mortgage funds), and in the process of doing so, perhaps establishing or creating a more pronounced awareness of spending an…
 
I often get asked what the minimum down payment requirement is to purchase another home. And by another, I mean residing in your current home as you are and purchasing another home that you or any one of your family members will frequent at one point throughout the year...like a home away from home. For example, it may be a vacation property a coup…
 
11th hour mortgage qualification collapses...how to avoid them There is no better feeling than closing a real estate transaction, especially if the journey to get there was rocky and filled with intense drama all the way to the bitter end. And if you’ve ever purchased a property before, you’ll know what I’m talking about...Regardless of the severit…
 
Is there such a thing as tax deductible mortgages? If you are a resident of the United States, the answer to this question is - yes. For decades Americans have been able to apply the interest portion of their mortgage as a tax deduction against their personal income. Regardless of whether it was an investment property or a principal residence - the…
 
A couple of weeks ago I talked about intergenerational wealth transfer and how reverse mortgages have propelled into the market place as a vehicle to access valuable equity with absolutely no monthly payment obligation. The homeowner (who must be at least 55 years of age) can apply to access up to 55% of their home equity and use the proceeds for a…
 
Today I'm gonna talk about one of my favourite qualification guidelines - the High Net Worth mortgage. This is truly one of those money-talks type of products...money talks as in, the more liquid assets you hold, the more mortgage you can qualify for. This mortgage really comes in handy for those applicants that are short on qualifying income, but …
 
Wouldn't it be great if there was a mortgage that didn't require an income to qualify for it? And better yet, absolutely no obligation to make a single payment on the principal debt throughout the life of the mortgage? Well there is! It's called a Reverse Mortgage. Whether you're a fan of them or not, these mortgages are becoming increasingly popul…
 
When it comes to income verification for a mortgage a recent paystub and an employment letter will typically do the trick, even if you're a new hire and just have one full pay cycle under your belt. However, things could get a little dicey if you are currently in a period of probation with your new employer. The most common workaround for an applic…
 
On Thursday April 8 (yesterday), The Office of the Superintendent of Financial Institutions, OSFI (the Canadian Bank watchdog) announced that they are proposing changes to the current stress test rule. So basically, consider this the last-call bell to qualify under the current stress test until June 1, 2021. It’s not 100% official as of yet, but th…
 
If you're self employed and qualifying for a mortgage right now (April), you are either gleaming with optimism or white knuckling your way to the finish line. And here's why... When qualifying as a self employed applicant, your qualifying income is determined from your most recent 2 year average (of your Notice of Assessments). Notice of Assessment…
 
Today I want to talk about how one could incorporate gifted equity when purchasing a home (with the proceeds of a mortgage) from a direct family member. So, in other words a transaction between two direct family members (mainly child and parent) can occur by the selling family member simultaneously gifting a portion of their equity to the buying fa…
 
When it comes to mortgages for newcomers to Canada, the qualification criteria remains similar to what Canadians can expect but with the following exceptions: Minimum down payment thresholds vary anywhere from 5% to 35% depending on ones residence status: Permanent Resident with standard income confirmation: 5-10% minimum down payment Permanent Res…
 
In Vancouver, purchasing a property these days has become somewhat comparable to a Black Friday event. A property gets listed, an offer date is set, several buyers line up to view the property (actually some don’t even bother to view as they go straight to the offer stage), and finally offers are placed. This is where things get dicey In normal tim…
 
The most common types of income when qualifying for a mortgage are variations of salaried, hourly, and self employed income. But what about other sources of income? There are plenty more to be aware of! Here is a list of some other less talked about forms of qualifying income: Part-Time Income: as long as the income is guaranteed, you could use 100…
 
Today I wanna talk about mortgage penalties and how and when they come into play within a mortgage. The when part of the question is quite simple, so let's begin there. Every mortgage has a maturity date (with the exception of home equity lines of credit), and if you sell your property or refinance your mortgage ahead of the maturity date, you are …
 
I think it's safe to say that every single detached home in Vancouver is priced over $1M. In fact as of Feb 2021, the average priced single family home in Greater Vancouver shot up to $1.83M (the third highest monthly figure, ever!). And here is the major disconnect of the entire real estate equation (for Metro Vancouver)...the median total income …
 
The term “First Time Home Buyer” is thrown around often these days and is tagged in countless incentive based programs and policies. In the future I will dedicate an entire newsletter to the various First Time Home Buyer privileges and programs, but today I will talk about one in particular, the RRSP Homebuyer Plan. What is the RRSP Home Buyer Plan…
 
Key Characteristics of fixed rate mortgages… Current Rate Range (as of Feb 5, 2021): 1.49% to 1.79% Distinguishing Characteristics: mortgage break penalties are the greater of 3 months interest or interest rate differential (IRD). And with that being said, your mortgage penalty figure can deviate back and forth throughout the life of your term depe…
 
Imagine running a marathon and you are 50 strides away from completing the race. But suddenly, a race official appears out of nowhere and moves the finish line another 500 meters ahead. This is what closing costs verification feels like...the applicant has just recently (painstakingly) satisfied the down payment verification and is now presented wi…
 
The dream to build your own home is alive and well, especially in Vancouver! Take a drive down any street in one of (metro) Vancouver's neighbourhoods and you'll see several projects on the go. This week I want to write about the mortgages that finance these incredible projects and what it takes to qualify for them. The mortgages are commonly refer…
 
Over the last decade the process of qualifying for a mortgage has increasingly become more cumbersome and frustrating. In fact, some claim it is easier to attain citizenship to another country than it is to secure basic financing for a 1 bedroom condo in Calgary. So why is this? Why all the questions, the excessive document requests and the never e…
 
What is a real estate assignment contract? Before I get in to the process of how to qualify for a mortgage when assigning a real estate contract, let's first unravel what a real estate assignment is. A real estate assignment is a transaction similar to that of a standard real estate transaction, except rather than being referred to as a buyer and a…
 
Since the launch of the program in Sept 2019, only 13% of the programs allocated reserve actually made it to the hands of first time home buyers. Will the upcoming enhancement spur more interested applicants, or is this program simply a dud? Three words that best describe Trudeau's First Time Home Buyer Incentive (FTHBI) program that was launched b…
 
One of the consequences of selling a home is the unexpected penalty that arises as a result of breaking your mortgage contract ahead of its maturity date. The penalty is determined by the greater of 3 months interest, or the dreaded interest rate differential (IRD). And the scary part is the your penalty can radically change from the day you list y…
 
Mortgages are classified as one of the following three; Insured, Insurable, or Uninsured/Conventional. The way a mortgage is priced and qualified depends on how its funds were purchased, acquired or allocated. Mortgages are either insured by the borrower, bulk insured (securitized) by the lender, or simply uninsured all together. Once they are give…
 
When I first became a mortgage broker (in 2004), the hardest thing for me to understand at the time was how business owners got away with qualifying for hefty mortgages with such low declared incomes. Like how does a contracted engineer who declared $65,000 on their T1 General end up qualifying for a $650,000 mortgage (which requires an annual qual…
 
The following is discussed in this episode: Throughout our lives we will likely be moving from one property to another, and in the process, we use the equity accumulated from the previous property to either buy the new property outright, or use whatever is remaining (once the existing mortgage is paid out) as a down payment for the new property. Bu…
 
Everyone assumes that verification of down payment proceeds for a mortgage is a swift and miscellaneous part of the mortgage qualification process. When you think about it, why would it be difficult? If the applicant does, in fact, have the funds in their bank account, why then does it matter where it came from and how long it's been there? One wou…
 
The following is discussed in this episode: Purchasing a property inside of a corporation: OPERATING COMPANY or HOLDING COMPANY? *this a decision you will want to discuss with your accountant as there are reasons to do so in both cases. However, as far as mortgages are concerned most lenders require that the property be held in a holding company. T…
 
The following is discussed: >for the 6th consecutive week 5 year fixed rates are available for as low as 1.79%. Even lower rates are available for no-frills products (I've seen rates as low as 1.64%). One other rate promo to be aware of -> 1.89% for a 5 year fixed, but no interest for the first three months (and it’s not tacked on to the mortgage e…
 
Key points: New approach/format to podcast...expect weekly episodes based on Marko's weekly newsletter Two upcoming events that could potentially cause interest rates to increase (Bank of Canada's announcement to stop purchasing bonds AND the US Election) a reminder of the 3 golden credit boosters Marko Gelo Garage Band Sessions: (produced and perf…
 
Key points: Consumer Credit Reports (Borrowell, Credit Karma, etc)...why can't brokers accept your free reports? When it comes to mortgages, credit reports are reviewed from a very broad perspective - way more to it then just the actual score Avoid deferring your broker/banker from checking your credit score...do it sooner rather than later learn a…
 
An overview of key points when qualifying for a mortgage in Canada, and what to expect: Key points: The Application Process: Old School and New School processes The Qualification Process: An overview of some key qualification guidelines Getting the best rates: there's more to it than you think ALSO INCLUDED: a Marko-Gelo-Garage-Band creation! Marko…
 
Why is it that banks differ in how much mortgage they approve you for? Even though all banks use the same qualification formulas, there are some banks that have additional boosters that can propel you to higher qualification amounts. Key points: Mortgage Approval Pro Tip #1: Down Payment and Amortization affect your maximum mortgage amount Mortgage…
 
How mortgages will play a key role in how Canada's financial system rebounds in the post-COVID era. Ready or not, here we go. Key points: 8 weeks in isolation and the resulting impact on mortgage qualification and Canada's financial system Canada's life saver...our general conservative nature (move ahead with caution approach) yesterday's compromis…
 
Key points: behind the scenes with (COVID19) appraisal procedures and value determination understanding the impact of loan-to-value ratios on your mortgage qualification preparation for your appraisal during COVID19 real estate value trends since COVID outbreak act now, or later? listen to the episode for more details! ALSO INCLUDED: past Marko-Gel…
 
Key points: access to fully discounted interest rates - not POSTED RATES ability to move to another lender without penalty option to change the terms and features of your new mortgage option to pay off any lingering debt without incurring any break fees how to become fully optimized and prepared for your mortgage renewal with minimal effort listen …
 
Key points: when bond yields go down, mortgage rates are supposed to follow...not these days if Prime Rate goes down, do fixed rates also go down? where are interest rates in Canada headed? What is the "Bank of Canada" and what is its purpose? how to capture the best interest rate for your upcoming mortgage renewal listen to the episode for more de…
 
Key points: YES - most Canadian banks are making the ability to defer your mortgage payments available for eligible applicants YES - the ability to defer for UP TO 6 months seems to be the generally promoted tenure of deferring your payments YES - for those that are anticipating hardship, you need to inquire and apply with, or at the very least inf…
 
Subtitle 4 reasons to use a mortgage broker Summary Key points: the Big 5 Banks in Canada...how many other lenders are there? 4 reasons to use a mortgage broker: (i) there's always a Plan B (ii) engage lenders to compete for your business (iii) interpreting the fine print of all lenders (iv) you won't know what you don't know and much more.. Guest …
 
Key points: average Canadian owes $1.78 for every $1 earned what happens to your credit when: you are behind in payments, your credit card is max'd reach out for a consultation sooner than later - when it comes to credit, time is always of the essence applications and examples of consumer proposals you can still qualify for a mortgage if you had a …
 
Key points: what does "remediated grow op" mean? how do you know if you are buying a property that was once a marijuana grow op? will banks approve your mortgage if your property was previously a grow op? growing marijuana is legal, does that mean your tenant can do so? home insurance and legalized marijuana legislation...what to be aware of and mu…
 
Key points: which party's housing affordability appeals to you most? verifying the source of your down payment - what do the banks expect? what if Bank of Mom & Dad contribute towards my down payment? how long must you have ownership of your down payment proceeds before you move in? money can be transferred into Canada from around the world (for mo…
 
A short talk about the newly launched First Time Home Buyer Incentive program in Canada. Key points: how does it work? how do you qualify? where do you apply? Canada only program For more details about FTHBI: https://www.placetocallhome.ca/fthbi/first-time-homebuyer-incentive Marko Gelo Garage Band Sessions: (produced and performed my Marko) the op…
 
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