Harvey Schmidke

Excerpt from BC Business Magazine, Feb, 2017 The Real Deal .........As for mortgage brokers, Ajay Soni, national president of the Cdn. Mortgage Brokers Association, would like prospective clients to know that mortgage brokers collectively fund over $70 Billion in mortgages in Canada annually, doing the legwork for buyers and shopping for the best deals meaning, not necessarily the lowest rates, but mortgages whose terms are truly the best suited to their clients’ financia...l situations. Many times mortgages with super-low rates come with stipulations that can wipe out the advantages, he explains. A good broker will protect a client against that. Soni points out that 55 percent of first-time homebuyers rely on mortgage brokers because first-time buyers value our services so much. In 2017, buyers may be aware that regulations regarding down payments have tightened, along with mortgage qualification rules. However, with our access to alternative lenders, we haven’t seen a noticeable slowdown in business, says Soni. In fact, 2016 was a record year for brokers, and we think the market will be robust in 2017. If you or someone you know would like more information, or would like to discuss your mortgage needs, I would be pleased to assist. See more

As parent, there are a number of ways that you can help your kids finance a home purchase: Cash gift Very simple No tax or income consequences to either party... No legal work required Cons Expectation of the other children. Potential for conflict of selectively providing support to only some children. The gift should be clarified as pre-payment for future inheritance Loans Could be interest-free or at market rate Interest earned by the parent(s) must be claimed as income on the tax return Interest paid is not tax deductible by the child If the loan is not repaid, and the interest had been reported as income, the parent(s) may be able to claim a capital loss Home buyers Plan The parent(s) could gift the cash to the child’s RRSP. The child can withdraw up to $25,000 from his RRSP to purchase their first home, (which must be owner-occupied) Funds have to be returned to the RRSP within 15 years RRSP mortgages The parent(s) can use their RRSP to invest in a mortgage loan secured by the title of the property There are strict rules and some costs associated with this method Guarantor or co-signer A co-signer will be on title A guarantor does not have to be on title The parent has the responsibility for the loan payment in the event of default by the child. If you have any questions about this or any other mortgage related matter, I'd be happy to discuss those with you. You may also want to check out a variety of blogs that can be found on my web page under the News tab. http://www.mortgagearchitects.ca/blog

You may have heard on the news today about significant changes to Canada's mortgage and housing regulations. If you are planning on getting a mortgage or refinancing, you need to be aware of these changes. Check out this link, and let me know if you have any questions. http://www.theglobeandmail.com//real-esta/article32229066/

Some sobering thoughts on what might result from a small interest rate increase. http://www.cbc.ca//transunion-debt-interest-rates-1.3759844 If you currently have a variable rate mortgage, you may want to think about converting that to a fixed rate. I'd be happy to talk to you about that.

Younger homebuyers (defined as those under age 40 who are not currently homeowners, but expect to purchase their first property in the near future.) are largely unaware about who mortgage brokers are and what they do. Comments according to a recent Canadian mortgage survey as to why they are not considering using a broker: I’ve heard bad things about working with a broker 11% I don’t trust brokers or the process of working with a broker 14%... I don’t think a broker could provide me with much value 15% I don’t think a broker could get me a better deal 17% I don’t want to go through the effort of finding a good broker 18% I don’t understand what services brokers provide 19% I don’t understand how brokers are compensated 22% I don’t want to deal witch a lender that I am unfamiliar with 22% The thought of using a broker just did not cross my mind 25% I would rather deal directly with a lender 29% I don’t want to pay for the broker’s services 41% Each one of these points is easy to address, and I would be happy to speak with anyone about their concerns or questions. You can reach me by phone at 778-840-8517 or by email at [email protected] 35% of younger homebuyers who are not well informed about the points above will use a broker 75% of younger homebuyers who are well informed about the points above will use a broker *Survey by Mortgage Professionals Canada