With all the buzz about a possible market turn around in the later part of 2009 and into 2010, interest rates on fixed-rate mortgages have never been better.
The main impact of low rates on higher net worth individuals is that they can accelerate the payment of their mortgage and quickly build equity in their homes for other things.
Using the equity in your home to build wealth is where my team and I come in. There are many ways to release the equity in your home to build your net worth and here are a couple of examples. BTW, each of these examples may allow you a tax write-off on your mortgage interest.
1. Use the equity in your home to buy other real estate. Commercial properties are holding their value, but will likely feel the pinch of the economy as those properties. Because buyers are expecting higher capitalization rates, prices may come down. Commercial properties such as plazas and multi-units are a great way to generate cash flow.
2. Use the equity in your home to invest in the market. Do I need to say more? Obviously working with a good financial planner who understands this market is extremely important.
3. If you're a sole proprietor, use the equity in your home to run your business expenses through. This often called "The Cash Flow Dam". It's something that I've worked on with my clients and can show you how to do this.
Sandra, The Mortgage Mentor
Friday, January 30, 2009
Monday, January 26, 2009
How can you be prepared to grow your real estate business in the current economy
Whether you're a real estate investor or real estate is a part of your business, you're likely concerned about the market and how it will impact your business in 2009.
How can you be prepared and still grow your business in the current economy? If you have questions, we'll provide you with answers. Attend this year's premiere real estate conference: The Real Estate Pulse Conference.
Participants will be armed with the facts on the current economic and real estate situation in Guelph and be prepared to face the upcoming market head on.
This years Key Note Speaker is Peter Vukanovich, CEO of Genworth Financial. Peter will provide a "CEO's Perspective" on the state of the real estate market in Canada and the impact on mortgage financing.
Book this date in your calendar now and register quickly as space is limited! The conference is being help on Thursday, March 12 from 12:30 p.m to 3:30 p.m. at The River Run Centre.
If your business depends on the real estate market, this conference is for you.
Please don't hesitate to e-mail if you have questions or would like to register. Sandra, The Mortgage Mentor
How can you be prepared and still grow your business in the current economy? If you have questions, we'll provide you with answers. Attend this year's premiere real estate conference: The Real Estate Pulse Conference.
Participants will be armed with the facts on the current economic and real estate situation in Guelph and be prepared to face the upcoming market head on.
This years Key Note Speaker is Peter Vukanovich, CEO of Genworth Financial. Peter will provide a "CEO's Perspective" on the state of the real estate market in Canada and the impact on mortgage financing.
Book this date in your calendar now and register quickly as space is limited! The conference is being help on Thursday, March 12 from 12:30 p.m to 3:30 p.m. at The River Run Centre.
If your business depends on the real estate market, this conference is for you.
Please don't hesitate to e-mail if you have questions or would like to register. Sandra, The Mortgage Mentor
Monday, January 12, 2009
Low mortgage rates are one benefit of a recession.
One positive aspect of this recession is low mortgage interest rates. If you're buying real estate for the Spring of 2009 or renewing your mortgage, you will benefit from low interest rates on both fixed-rate and variable-rate mortgages.
Remember that even if you're moving to a new home, it's worthwhile to shop around for your mortgage. You do not have to deal with your existing financial institution if they do not have the best mortgage and interest rate available on the market. Sometimes a minimal cost can save you thousands on a lower interest rate.
Canadian employment numbers were released last week and the prognosis is that over the first half of 2009, we can expect the unemployment rate to head towards 8% before coming back down as the economy stages a recovery in the latter part of the year. Employment figures are key in predicting economic activity, which also includes looking at what is happening at GDP.
Mortgage rates will remain consistently low for 2009, but I'm encouraging my clients that if they're looking for real estate in 2009 to get pre-approved in January as a pre-approval locks in a fixed-rate for you and protects you from subtle market fluctuations.
If you have any questions, please don't hesitate to post a comment or contact me directly through e-mail. Sandra, The Mortgage Mentor
Remember that even if you're moving to a new home, it's worthwhile to shop around for your mortgage. You do not have to deal with your existing financial institution if they do not have the best mortgage and interest rate available on the market. Sometimes a minimal cost can save you thousands on a lower interest rate.
Canadian employment numbers were released last week and the prognosis is that over the first half of 2009, we can expect the unemployment rate to head towards 8% before coming back down as the economy stages a recovery in the latter part of the year. Employment figures are key in predicting economic activity, which also includes looking at what is happening at GDP.
Mortgage rates will remain consistently low for 2009, but I'm encouraging my clients that if they're looking for real estate in 2009 to get pre-approved in January as a pre-approval locks in a fixed-rate for you and protects you from subtle market fluctuations.
If you have any questions, please don't hesitate to post a comment or contact me directly through e-mail. Sandra, The Mortgage Mentor
Wednesday, January 7, 2009
If you're "moving-up" in 2009 why you'll win in this market
There are many benefits to a market that favours buyers, even if you're selling a home in 2009. I've been working with several clients lately who are considering moving to a larger home in the spring of 2009 and have asked me if this is a good time to do so.
The main advantage to moving up in a market that favours buyers is that you can buy more for less. Although home prices in Guelph and area are remaining stable, let's take a worse-case scenario approach and say that they decrease by 5% across the board.
For example, if I'm selling my home of $200,000 and the price decreases by 5%, I'm selling at a $10,000 loss. The individual selling their home for $400,000, which I am interested in buying will also have a 5% decrease which benefits the buyer by $20,000. That means that as a buyer of a larger home I'm getting a $400,000 home for $380,000.
Home prices that are stabilizing and slightly depreciating are a great opportunity for a savvy homeowner looking to move up. Even though your home sale price may be lower the smaller loss at sale can be compensated by greater savings at purchase. To boot, we're at historically low interest rates which means that the larger home becomes more affordable.
For more information, please don't hesitate to contact me at lastovic.s@mortgagecentre.com. Sandra, The Mortgage Mentor.
The main advantage to moving up in a market that favours buyers is that you can buy more for less. Although home prices in Guelph and area are remaining stable, let's take a worse-case scenario approach and say that they decrease by 5% across the board.
For example, if I'm selling my home of $200,000 and the price decreases by 5%, I'm selling at a $10,000 loss. The individual selling their home for $400,000, which I am interested in buying will also have a 5% decrease which benefits the buyer by $20,000. That means that as a buyer of a larger home I'm getting a $400,000 home for $380,000.
Home prices that are stabilizing and slightly depreciating are a great opportunity for a savvy homeowner looking to move up. Even though your home sale price may be lower the smaller loss at sale can be compensated by greater savings at purchase. To boot, we're at historically low interest rates which means that the larger home becomes more affordable.
For more information, please don't hesitate to contact me at lastovic.s@mortgagecentre.com. Sandra, The Mortgage Mentor.
Tuesday, January 6, 2009
Renewing your mortgage early may make sense if you have a 6.5% interest rate or higher on your fixed rate mortgage
If you're into fixed-rate mortgages because you like stability and security, now may be a good time to revisit your mortgage and renew it early. There are times when it makes sense to break your old mortgage, pay the penalty and get a new mortgage at a lower rate.
Some of the things that you'll need to talk about with your mortgage professional to help them evaluate the pros and cons of renewing early include:
Some of the things that you'll need to talk about with your mortgage professional to help them evaluate the pros and cons of renewing early include:
- your current mortgage balance and value of home
- your interest rate
- renewal date
In the last month, I've worked with two families where it made sense to break their existing mortgage pay the penalty and get a new five year fixed rate mortgage. One family went from an interest rate of 7.1% to 4.89%. What they were able to do with this lower interest rate is shorten the amoritization by 9 years while still maintaining about the same bi-weekly payment. They are now able to pay their mortgage off in 10 years rather than 19 years. The penalty of $2000, plus an additional $800 for a lawyer visit made sense considering the ability to shave-off nine years on their mortgage.
If you have any questions about this and how it would apply to your own mortgage situation. Please e-mail me! Sandra, The Mortgage Mentor
Subscribe to:
Posts (Atom)