Archive | February, 2012

When did you last look at your deed?

February 29, 2012

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Not long ago, many people in the Squamish area of British Columbia discovered that they do not in fact own the properties they have called home for years, and in some cases decades. This was essentially because of surveying errors by the provincial government related to First Nations treaties dating back over 100 years. The province has pledged to purchase the properties at market value for those who are affected, and those who wish to stay will be allowed to have the properties transferred to them because of an agreement reached with the Squamish Nation. The transfer process will likely be long and complex.

While this particular situation would almost certainly not have been discoverable through searches by the lawyers involved, considering the error was an improper survey pin placed in 1917, it still highlights the need to have proper searches done before you complete your purchase. As I blogged about here, there are a number of searches that real estate lawyers do as part of ensuring that you have clean and proper title to your home. And when you get your report, you can check out your deed to see exactly what you purchased.

Cesia

Cesia is a real estate lawyer at Wall-Armstrong and Green, a boutique law firm in Barrie focusing on real estate and estates. When she's not online, she can usually be found in her garden.

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NHL Trade Deadline Day

February 27, 2012

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I have to admit – I’m a huge hockey fan, and every year I take “NHL Trade Deadline Day” off to lounge around and watch sports TV all day.  I’m self-employed (I work under a brokerage – Real Mortgage Associates – but not for them), and one of my favourite benefits of being my own boss is a flexible schedule.  As soon as the 2012 NHL Trade Deadline was announced, it was added to my calendar as a full-day appointment – something that makes many of my regularly-employed guy friends jealous, I’m sure.  😉

But what does the NHL Trade Deadline have to do with mortgages?  As I sat there watching “player reactions” after just finding out they’ve been traded (this year there were 15 trades that included 31 people), none of them specifically mentioned their house or mortgage, but many of them noted that getting traded results in having to move their family.  I imagine in many cases, this means selling their house and buying a new one.  Now consider the fact that a good chunk of these athletes make $X,xxx,xxx/year, so their house and mortgage are probably a pretty decent size.    If they have to break their mortgage early, this could end up costing them tens of thousands of dollars in penalties.  Here in-lies the importance of a good mortgage broker.

If your situation is such that it’s possible that you may be moved for work, changing jobs, etc., it may be more important to have an open mortgage that you can easily get out of.  Sure, a privilege like this could cost you a little in the rate department, but if you have to break the mortgage early, it could pay for itself hundreds of times over.  Would you rather have a rate of 3.19% and the possibility of high penalties, or 3.29% with some great pre-payment privileges and low buy-out penalties?  If there’s little chance you’ll be needing to break the mortgage, saving $20/month may be worth the chance, but on the flip side, that $20/month savings could end up costing $20,000 in penalties if you’re not careful.

When it’s time for you to buy your first house, or renew your current mortgage, take the time to chat with a mortgage professional.  A good mortgage broker will ask these types of questions and help you pick the rate and options that best suit you!  You may be a tenured college professor who’s not going anywhere anytime soon, but if you’re a NHL player, location-certainty isn’t exactly set in stone – just ask the 31 players that were traded today.

Tim

Tim is a mortgage agent in Barrie who specializes in helping first-time home buyers. He works with a variety of lenders and can help customize a mortgage with the best rates & options that fit the needs of each customer.

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Family Day

February 20, 2012

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People are rarely thinking about real estate and finances on holidays, so we usually take the day off here on BarrieRealEstateTalk.ca as well.  Family Day has been around in Ontario since 2008, and it’s basically a holiday that was placed in the middle of February to give us a break between the Christmas/New Years holidays, and Easter.  It’s goal is to allow Ontarians (as well as other provinces like Alberta, Saskatchewan, Manitoba and PEI, with BC getting ‘Family Day’ starting in 2013) to spend a day with their families.  If you want to talk about mortgages, you’ll find that your lender (all banks and most other lenders) are not available today.  I’m sure most mortgage brokers and real estate agents are taking the day off as well (though if it’s something urgent, I wouldn’t be surprised if most of us wouldn’t mind answering a quick phone call or replying to a quick email).  I’m not going to encourage this very often, but don’t think about your mortgage today.  Spend it with your family.  If you’ve got questions or concerns about your mortgage, wait until tomorrow.  Your favourite mortgage broker will be happy to help you – tomorrow.

Enjoy the day off with your family.

Tim

Tim is a mortgage agent in Barrie who specializes in helping first-time home buyers. He works with a variety of lenders and can help customize a mortgage with the best rates & options that fit the needs of each customer.

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Tips for Renovation Spending

February 17, 2012

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Homeowners hear so much about how renovating their homes will increase its value. This is certainly true to a point, but I have seen more times than I would like to say that people lose money after they renovate – especially if they’re renovating to sell.

It is common knowledge that kitchens and bathrooms sell, but does that mean you need to tile the bathroom in your 2-bedroom townhouse with Italian marble? Probably not. The only value this adds is to the homeowner. I recently saw a house for sale where the homeowners spent $18,000 on a solid mahogany door from Europe! You can bet they didn’t retrieve that cost.

Here are some easy tips to follow when you’re renovating:

  1. Over-expanding. Most people want to keep up with the neighbours, and sometimes surpass them. However, if you live in a community full of war-time bungalows, it’s probably best not to build a 3-storey stone mansion on your lot. It will be harder to sell when the time comes, and the value of your home will be negatively affected by those around you.
  2. Changing a room’s function. Homes are generally built to serve a specific purpose, and each room reflects that. If you decide to change a main floor bedroom into a dining room, you’re going to lose a bedroom and that decreases the value when the time comes to sell. This only works if you don’t change any structure and if you “stage” it properly when you put it on the market.
  3. Under-budgeting. This often happens with first-time renovators. You think it’ll only take a few thousand to redo the kitchen. Think again. Even if you think you’ve measured correctly and costed the products at your local hardware store, you should usually expect to go 20-30% over budget. Take into account what happens when you take the cabinets off the wall and rip the drywall…you’re going to have to replace that piece of drywall. And if you open the walls to do a bit of re-wiring, you never know what you’re going to find. It’s always a good idea to get a few professionals in to give you estimates. Save up your money instead of putting it on credit, too! It all adds up, and you may need your credit for the extras that eventually pop up.
  4. Doing unnecessary work. You’ve lived in your house for 3 or 4 years. Obviously, the things you see every day are the things that will annoy you the most. Keep in mind that you can make small alterations to those annoyances – paint your cabinets or install new hardware, install a bathtub insert instead of re-tiling. You get the idea. Statistically, the smaller the renovation, the better the return. Talk to a REALTOR before you renovate, even if you’re not selling that year! We can give you a pretty good idea of what makes sense for your near future.
  5. Maintenance neglect. As I just mentioned, fixing the things you see every day tends to be the first thing you do. It is SO important not to forget the “bones” of the house. I’m talking about the roof, windows, furnace, air conditioner, etc. They’re not glamorous, and you probably won’t notice much of an aesthetic difference. But these are the items in your home that will truly pay off in the end.

As with any big decisions you make in your life, take the time to consider all the options. Figure out what renovation would be the best value for you while you stay in your home, and for the future when you sell. Talk to as many professionals and you can, and get lots of information.

Good luck!

Laura

Laura Keller of Century 21 B.J. Roth Realty is a real estate agent with a business philosophy of nurturing relationships with her clients. She will walk you through the process of buying, selling, or investing step-by-step so there are no surprises at the end of your transaction.

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Privacy beats the bank

February 15, 2012

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Last year, the Ontario Court of Appeal released a decision in Citi Cards Canada Inc. v. Pleasance. In this case, Citi Financial wanted to collect on a credit card debt of $11,000.00 through a forced sale of the debtor’s home. In order to do so, however, it needed confidential information from the debtor’s mortgage lenders. When the lenders refused to release this information, Citi sued, claiming that it was entitled to the information for its own protection. In its ruling, the Court determined that privacy is more important than the debt owing, and declared that PIPEDA, Canada’s privacy law, prevents lenders from revealing confidential information to anyone, even other creditors in order to facilitate the collection of a debt. This decision means that lenders can use PIPEDA to prevent creditors from acquiring this type of information, but it also means that lenders that had been voluntarily sharing this information can no longer do so. While there is still very strong protection for creditors against defaulting debtors, a debtor who is current on his or her mortgage and in default on another loan may be able to be safe from a power of sale.

Cesia

Cesia is a real estate lawyer at Wall-Armstrong and Green, a boutique law firm in Barrie focusing on real estate and estates. When she's not online, she can usually be found in her garden.

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