One of the ways loved ones can help hopeful home buyers is by agreeing to be a co-signer on the mortgage. Co-signing can be applied to most types of loans, not just mortgages. Essentially, a co-signer takes on the responsibility of making the loan payments in the event the original borrower can’t. By providing this extra assurance to the lender, co-signers can help applicants qualify for a mortgage.



Read more...


https://www.realtor.ca/blog/understanding-the-role-of-a-co-signer-in-buying-a-home/20160/1362

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As home owners age and live longer, their income sources may no longer be enough to cover expenses, especially for those on fixed incomes.

Many home owners in this phase of life look to the market value their homes have built since they purchased it, also known as equity, to help cover these expenses.

But how can they access their home’s equity without selling it?

One option is a reverse mortgage.


Read more from the REBGV Newsletter...


https://www.rebgv.org/news-archive/what_s-a-reverse-mortgage--.html



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One third of BC residents live in a strata home, whether it’s a condo, townhouse, or multi-plex unit.

Strata homes are usually more affordable than their single-family counterparts. They can also lessen the burdens of home ownership, with strata residents sharing responsibilities for things like maintenance, snow shoveling, and security. And while these homes tend to be smaller, they may also have access to amenities like a pool or gym. 


If you’re looking to own a strata home, make sure you’re familiar with related terminology. Here’s a guide to some of those terms.

Strata

In a strata development, the parts created for individual ownership are called “strata lots.” Informally, these lots are referred to as a “strata unit” or a “condominium.” The rest of the development consists of common property. Strata housing can include: condos, townhouses, and multiplexes.

Strata corporation

Strata owners own their individual strata lots and together own the common property as a strata corporation.

Strata council

The law recognizes the need for an executive body to carry out the duties of the strata corporation and to oversee the corporation’s affairs between general meetings of the eligible voters. This executive body is called the strata council. It’s effectively a board of directors.

The strata council’s role is to:

  • act as the managing body for the strata corporation,
  • make daily decisions that enable the strata corporation to operate smoothly, and
  • enforce bylaws and rules.

Maintenance fee

To pay for shared common expenses such as insurance, gardening, cleaning, snow removal, and repair and maintenance, strata owners must pay maintenance fees on a regular basis - usually each month. 

Special levies

In addition to strata fees, sometimes owners will be required to pay extra for matters affecting the strata corporation, including the repair and maintenance of common property and assets like replacing the roof or upgrading an elevator. Special levies aren’t part of the operating budget and need to be voted on and approved by the owners.

Contingency fund

There are two funds in a strata corporation: the operating fund, which is for common expenses that occur once a year or more often; and the contingency reserve fund for common expenses that usually occur less than once a year or are unexpected.

Depreciation report

A depreciation report identifies the common property, common assets and those parts of a strata lot the strata corporation by bylaw must repair and maintain. The depreciation report will determine:  

  • What assets a strata corporation owns - an inventory 
  • The assets’ conditions - evaluation  
  • When items need to be replaced - the anticipated maintenance, repair and replacement
  • How much money the strata corporation currently has - contingency reserve report
  • What it’s likely to cost for future replacement - a description of the factors and assumptions in projecting costs  
  • How the strata corporation can pay for the costs - three cash‐flow funding models projecting 30-year replacement periods

Resources

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The Office of the Superintendent of Financial Institutions (OFSI) and the Minister of Finance, Canada’s banking regulators, tightened the rules around the mortgage stress test on June 1.

Under the new requirements, all mortgage applicants must be able to afford their mortgage at an interest rate of 5.25 per cent or two per cent over the contract rate, whichever is higher, regardless of their down payment.

How will the new stress test impact home buyers?

Regulators introduced the stress test for insured mortgages in 2016 and for uninsured mortgages in 2018. This original stress test required borrowers to qualify at the greater of the benchmark posted rate for a five-year term or 200 basis points over the contract rate. This change reduced home buyers’ purchasing power by approximately 20 per cent and was a key factor behind the decline in housing market activity in 2018 and 2019.

This most recent adjustment to the stress test is anticipated to decrease the amount home buyers’ can borrow by approximately four per cent.

“While we saw a large impact on home buyers the last time the stress test rate increased, the magnitude of these changes is quite different,” said Keith Stewart, REBGV Economist. “A four per cent reduction in a home buyer’s maximum budget is unlikely to move too many people in or out of the market, or change the type or location of home they choose to buy.”

The new rules will dampen mortgage credit growth, but should have a modest effect on home sales and prices in the region going forward, according to Stewart.

If you’re looking to get into the housing market today, it’s critical that you work with your REALTOR® and mortgage specialist to carefully review your financial situation and ensure that you’re always making responsible, long-term borrowing decisions. 

(REBGV Newsletter)

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Part of our job as realtors is to educate the public about the buying and selling process and then guide them, negotiate for them AND protect them throughout that process. According to the federal government, we are also tasked with the job of identifying all parties to a real estate transaction with the Personal Identification forms provided by FINTRAC (a lengthy explanation of what they are in the link below).

Essentially Fintrac is: The Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) Canada’s financial intelligence unit (FIU). The Centre assists in the detection, prevention and deterrence of money laundering and the financing of terrorist activities

As you may have heard, real estate has provided substantial opportunities for money laundering in Canada, in particular B.C. As of June 1st, in addition to providing us with proof of ID ( Driver's license or Passport), we will be asking you questions about your job, and the jobs of your family to determine if you are a PEP - Politically Exposed Person, someone who could possibly be a target of or be in involved in criminal activity, or a high ranking government official who again may be the target of criminal activity. If you are buying or selling real estate in the name of a corporation, we will be asking you for 

ownership information. This information will be kept safely at our brokerage until the government needs access to it.

Yes, it is more paperwork and questions, but at the end of the day, it is for the safety of all of us, that our homes and investments are not being used for criminal activity.



https://www.fintrac-canafe.gc.ca/fintrac-canafe/1-eng

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