You need to leave your current home and move to a new town for work, or your family has outgrown your current residence in Spruce Grove, Stony Plain, Parkland County, the Edmonton region or elsewhere. Should you buy a new home before selling your current home, or is it better to sell the old one first? This is a complicated question with pros and cons on both sides of the issue.

Buy First

Pros:

• You can take your time to shop for a new home and make it ready for your occupancy.
• With no one waiting to move in to your current home, you’ll feel less pressure to move out and you’ll have more time to prepare for the move.
• The biggest advantage is the security of knowing you have somewhere to live, whether that is your current home or a new one.

Cons:

• It may be necessary to carry two mortgages for a time (assuming you can even get one on a new dwelling), as well as maintain two homes, and this could be problematic and costly.
• An Offer to Purchase a new home that is conditional on the sale of your current home may not be acceptable to many sellers because it ties up their property while everyone waits for your current home to sell. If it doesn’t sell, you then risk having the deal on your new home fall through.

Sell First

Pros:

• You’ll have money in the bank and will know how much you can spend on a new home.
• Your Offer to Purchase a new home would not need to be conditional on the sale of the old one, making your offer more likely to be accepted.

Cons:

• Selling your current home before buying another one could leave you homeless! You might find yourself quickly buying a less than satisfactory home just to put a roof over your head, or having to rent temporary accommodations until you can buy a suitable home (and having to move twice, or place your belongings in storage).
• If the sale of a new home goes through before you sell your old home, you may be short of cash for down payment and closing costs, and this could require “bridge financing”.

Ultimately, your family situation and especially your finances will determine which scenario will be your choice.

I often deal with clients in this situation and can usually help people find a workable solution. Call or text me at 780-910-9669, email me at barry@barryt.ca, or contact me here.

There’s no question technology has improved our lives, whether we live in Spruce Grove, Stony Plain, Parkland County, the Edmonton region or elsewhere. It has streamlined communications, made it easy to buy the things we want, and lets us manage our finances wherever we are.

Technology, however, has also made us vulnerable to hackers and identity thieves who prowl the Internet 24/7, attempting to steal personal information including social insurance numbers, usernames and passwords, driver’s licenses, passport info, signatures, bank accounts and PINs. According to the most recent report from the Canadian Anti-Fraud Centre, in 2009 more than 11,000 Canadians fell victim to identity theft, with a loss of more than 10 million dollars.

“There are many steps Canadians can and should take to protect themselves from identity theft,” says Ryan Michel, senior vice president and chief risk officer at Allstate Canada. “You can get started by adding personal record management to your annual spring cleaning check-list and by making a point to shred old bills, receipts, statements and personal documents.”

Here are five other suggestions:

1. Don’t give out personal information over the phone, through mail or the Internet unless you initiated the contact and trust the company.
2. Don’t carry your social insurance number with you and don’t ever give it out unless absolutely necessary (tax and employment purposes).
3. Review your credit card and bank statements monthly and look for unusual patterns. If your bills don’t arrive on time, follow up with creditors.
4. Don’t use easy-to-guess passwords or PINs like your birth date or address. A combination of letters and numbers is best. Change your passwords regularly and consider subscribing to a service that encrypts passwords for added protection.
5. Speak to your insurance provider about home insurance options that cover expenses associated with identity theft.

And if you do become a victim of identity theft:

• Call the police immediately and ask for a copy of the police report.
• Contact your financial institution and other companies that provide services to you to cancel credit cards and have new ones issued.
• Contact credit bureaus and place a fraud alert on your credit reports.
• Change your online passwords.

Michel points out that additional tips and helpful information are available at www.allstate.ca/learningcentre.

March is Fraud Prevention Month and it presents an opportunity for Canadians to be more proactive about protecting themselves online.  Check out The Little Black Book of Scams from the Competition Bureau of Canada for tons of information about how to protect yourself and your family, and put an end to scammers.

Questions or comments about the information in this article?  Call or text me at 780-910-9669, email me at barry@barryt.ca, or contact me here.

(Most of the content of this article courtesy of www.newscanada.com)

If you’re looking to purchase a home in Parkland County, Stony Plain, Spruce Grove or the Edmonton area, you might be wondering how you can reasonably determine what your price range is. Though you may have the ability to afford up to a particular amount, you should also ensure that you don’t overextend yourself. Make sure to leave room for the “just-in-case” expenses, and follow these tips to ensure you are remaining within your reasonable and affordable budget.

Get Expert Advice: Talk With Your Mortgage Specialist

First things first, before you begin your property search, whether you’re looking for Parkland County acreages, Edmonton acreages, or surrounding area, you should ensure you have an open and honest discussion with your mortgage broker or the mortgage specialist at your bank. When you are preparing for your meeting, ensure that you have your employment and income documentation to bring with you, as well as your previous year’s tax return. You should also have a list of any monthly expenses, and supporting documentation, such as information on car payments, student loans, and other monthly expenses.

Be sure you are honest and provide complete information to your mortgage broker regarding your income and monthly expenses, as this will help them determine what your affordable and realistic purchasing budget is.

Don’t Forget the Extras: Factor In Additional Expenses

When you are planning your affordable budget for your Spruce Grove real estate, either with or without your mortgage broker, you’ll want to ensure that you consider additional expenses on top of the basic mortgage costs. Discuss any additional mortgage insurance costs with your broker, as well as expenses such as maintenance fees and property taxes. Each of these aspects should come together to help you ascertain what you can reasonably afford, and, when considering these additional factors, your actual home budget may be tightened. Therefore, be sure not to forget the extras!

Have Foresight: Consider Closing Costs From the Start

Since your down payment amount on your mortgage for Parkland County real estate can significantly affect your monthly mortgage costs, you’ll want to ensure that you consider the amount of closing costs well before you get to that point in your real estate transaction. A possible problem arises when these costs aren’t factored into the equation from the start, and the buyer has to pull away from his down payment lump sum to come up with the money, thereby increasing his monthly expenses and perhaps overextending him financially. Therefore, ensure you are well prepared for the closing costs on your Stony Plain real estate, and get the figures from your mortgage broker or REALTOR® at the start.

As long as you’ve done your research on the matter, and factored in all of the aspects of your income and monthly expenses, as well as the additional fees of the real estate transaction itself, you will surely arrive at a number that is reasonable and affordable. Get your expert advice, do your research, and have foresight, and you should be in great shape!

If you’re still unsure, I am always willing to answer your Edmonton area real estate transaction questions! Call or text me at 780-910-9669, email me at barry@barryt.ca, or contact me here.

Whether you own your Spruce Grove, Stony Plain, Parkland County or Edmonton area home for months or decades, there will come a time when you will need to sell it. Wise home owners know that the value in their property, and their enjoyment of their home, can slide in a hurry if maintenance and repairs are neglected. What’s more, failing to deal with problems as they occur may result in much bigger, more expensive and more urgent repairs later on. That little patch of damp showing up on the ceiling today could lead to a major and expensive whole roof re-do in a few months.

Home maintenance and repair falls into two categories:

• Minor ongoing repairs: Basic everyday upkeep includes replacing burnt-out light bulbs, oiling squeaky hinges on doors, tightening loose cabinet handles, repairing leaky faucets or slow drains, changing the furnace filter, patching the driveway, and a long list of things that need to be done to keep your property in show home condition. These pesky things are easy to ignore, but potential buyers will be unlikely to offer top dollar for a property with many small but visible faults.

• Major once in a while repairs: The second kind of repair is needed when essential systems break down or wear out, sometimes without warning and at inconvenient times: the furnace quits, the sewer backs up, the hot water tank leaks, roof shingles wear out and no longer keep water from entering the house, wooden window frames rot out, the springs in your automatic garage door give out, and so on. If you live in your home long enough, you will probably experience all of these situations and others, and these items are often expensive to fix.

So, how do you go about budgeting for everything that will eventually need to be repaired or replaced in, on or around your home?

There are several methods to do this, but all involve setting aside a certain amount of money every year.

1. The 1% Rule. Reserve each year one per cent of the purchase price of your home (or the appraised value of your home as per your annual property tax assessment). Home valued at $350,000? Budget for maintenance costs of $3,500 annually. Maybe you won’t need to spend that much every year, but you’ll be glad you saved the excess year over year when the big catastrophic expenses hit.

2. The Square Foot Rule. Every year set aside $1 per square foot of finished space in your home. 1,200 square foot bungalow with finished basement? Budget for about $2,000 to $2,500 per year. You may also want to take into account the square footage of a garage, garden shed and the like.

3. The Systems Approach. More complicated but possibly more accurate than the previous two suggestions, this method is based on the 7 systems found in each home: outside structure, roof, foundation, plumbing, electrical, heating/ventilation/air conditioning (HVAC), drainage/landscaping. Consider all the minor maintenance and major repairs that could be done on each system and calculate an annualized amount for each. Luckily, this work has already been done by Romana King in her article “The Ultimate Home Maintenance Guide”, published in the magazine Money Sense. Her conclusion is that, depending on the size and age of your home, you should plan to budget $900 to $2,500 per year for basic maintenance, and an additional $3,500 to $7,300 for big items. This means annual cost of upkeep could range from $4,500 to $10,000 per year.

No matter how you calculate it, looking after your home can be costly. If you take care of minor repairs as they’re needed and plan ahead for the inevitable replacement of systems, costs will be spread out throughout the time you own your home. You’ll be able to enjoy your lovely home without worrying that the roof will, literally, fall in, and when it comes time to sell, your well-maintained home will return a good price.

Whether you’re looking to buy a pristine new home with nothing to do but move in, or you’re a handyman looking for a fixer-upper, I can help! Call or text me at 780-910-9669, email me at barry@barryt.ca, or contact me here.

Now is the perfect time to be looking for property in Spruce Grove, Stony Plain, Parkland County and the Edmonton region! Particularly in Spruce Grove real estate and Stony Plain real estate, the housing market is looking positive and there is a lot of inventory for first time homebuyers looking to get that perfect home in a small city. If you really want to take advantage of the Stony Plain real estate market right now and get the keys to your very first home, there are a few quick budgeting adjustments you can make that will get you into a house that you own. Here are a few great money-saving tips to help you save up that down payment.

Make Your Own Lunches

Many people don’t realize this, but you could free up a lot of your money by making your own lunches and at-work snacks at home rather than buying them during the workday. A ten dollar lunch and a five dollar a day coffee habit add up to $300 over the course of a month. Train yourself to make your lunch at home the night before and keep it in the fridge. You can also consider bringing leftovers to work for lunch. Bring lots of snacks for the morning and late afternoon so that you don’t feel the need to go out and buy more food. Once you get into the habit of making your own food, you’ll love how your savings steadily increase.

Make Small Trips Instead of Big, Expensive Ones

Travel is a big expense and one that people who are saving for a house usually cut. People are often slow to cut down on travel because they somehow get the idea that there is nowhere amazing to go near Stony Plain or Parkland County real estate. However, this couldn’t be further from the truth. Use this time to explore smaller places near Parkland County acreages that are off the beaten trail. Athabasca and Wabamun are both within an hour from Stony Plain, and are great places to go camping if you’re the outdoor type. If you want something a bit more adventurous, try heading to Jasper for a night, or road tripping to Kelowna, where you can easily find a low-cost hostel for a few nights.

Track Your Expenses: There’s an App for That

One of the best ways to watch your budget is to track your expenses with a money management app. Mint is a great budget app and website that will let you manage all of your accounts and credit cards in one place. Mint is one of the web’s most popular personal finance tools, and it has many great features that you can use to stick to your budget. The app will send you weekly reminders of your goals and the progress you are making. Financial goals are always easier to meet when you pay close attention to them, and this website can help you do just that.

Now is a great time to buy a place in Stony Plain. Even if you think you’re not quite ready to buy a home, if you begin to budget you may notice that you’re actually not that far away. Starting a few healthy habits and tracking your progress is critical in meeting your financial goals.

For more great home buying advice, or for information on Edmonton real estate or Edmonton acreages, feel free to call or text me at 780-910-9669, email me at barry@barryt.ca, or contact me here.

My clients in the Spruce Grove, Stony Plain, Parkland County and Edmonton area often ask me if “now” is a good time to buy a new home.  My answer to that question usually involves telling them that the best time to buy is when they feel ready to do so, no matter what the market is doing.  That may sound like a weasel answer but I believe people’s own finances and their needs and wants in housing are better for decision-making than any attempts to time or predict the market.

But “now” is an interesting time to be dealing in real estate in Alberta.  You’ve probably seen the gloomy news reports that the Canadian housing market is due for a major correction with house prices set to fall by about 20%.  That is not the case here!

In a recent article in the Edmonton Journal entitled “Alberta’s housing market still hot, whatever the media say”, Gary Lamphier reports on a conversation with Don Campbell, senior analyst and founding partner with the Real Estate Investment Network (REIN).  Mr. Campbell advises would-be sellers and buyers to “chill out”, suggesting that there is no such thing as a Canadian real estate market, but rather that each locality has its own unique market and conditions.  He goes even further when commenting about the Alberta market, saying that economic and demographic factors here are ripe for another housing boom, not bust.  He notes Alberta’s population continues to grow as workers come into the province while apartment vacancy rates shrink.  Many of these workers will decide to make Alberta their permanent home and that means they’ll be buying houses sometime in the next 2 to 7 years, fueling demand for houses and the subsequent rise in prices.

You may have heard or read that prices in Alberta have flat-lined so how can the dream of a new housing boom be true?  Mr. Campbell says Alberta’s boom-bust economy and the accompanying anxiety in people’s minds is to blame for this skepticism, along with tougher mortgage qualification rules and the negative national news.  He points out that Alberta’s population growth in 2012 was nearly triple the national average, putting a strain on housing capacity.  This situation tends to cause prices to rise.  While the average price of a house in Edmonton (about $401,000 in February) is still not as high as the peak prices in 2007, prices are definitely on the rise, according to another article entitled “Home prices flirt with record highs of ‘07”.

All of this suggests to me that now is indeed a good time to buy!

Let me help you find the home that’s just right for you.  Call or text me at 780-910-9669, email me at barry@barryt.ca, or contact me here.

As the holiday season approaches in Spruce Grove, Stony Plain, Parkland County and the Edmonton region, you’re probably getting your home in shape for visits from family and friends.  This may mean adding new furniture or entertainment devices, as well as cleaning and organizing your current possessions.  Do you have a record of all your possessions, old and new?   

Your home and everything in it means a lot to you.  Sure, you have insurance in case anything should happen, such as a break-in or fire or adverse weather event.  But how would you let your insurance agent know exactly what you have that may need to be replaced?  As you go about your holiday preparations, it might be a good time to consider re-doing, or creating for the first time, an inventory of everything you own connected with your home.  Good idea, you say, but where to start? 

Luckily, the technical world can come to your rescue, both for creating the inventory and for storing it.  At its heart, a home inventory is a list containing various pieces of information such as name of the item, its location in your home, brand name, purchase price, current or replacement value, when and where acquired, serial numbers and so on.   

CAA Magazine’s “The Value of Your Home:  Tips on Creating a Home Inventory List” can get you going with a step by step process.  Another article on this topic is State Farm’s “Creating a Home Inventory”.

Here are some tools that can make your job easier: 

• Spreadsheet software, such as Microsoft Excel, Open Office Calc, or Google Docs Spreadsheet (see this home inventory template) can create a form on which to record the data.   
• It’s also possible to find many pre-made home inventory templates on the internet, such as these examples:

Insurance Brokers Association of Canada Home Inventory Form 

State Farm Home Inventory Checklist 

Minnesota Department of Commerce, Insurance Division Home Inventory Checklist

• A photo or video inventory is a good complement to a written list.  Today’s cameras and even phones make it easy and relatively fast to take stock of a home’s contents.  The pros recommend not just taking a picture of an item, but also zooming in on serial numbers and important details, such as the brand of an object (turn over a piece of china to show the manufacturer, for example).  It’s also a good idea to take pictures of receipts or appraisal reports, especially for high-value items purchased new, or antiques.  Audio can provide a running commentary of what the items are and their value.  Burn the pictures to a DVD for storage outside your home or upload them to an online account.
• Home inventory software is another option, and some very good ones are free:

Know Your Stuff Home Inventory

What You Own Home Inventory

These packages allow you to create lists, add photos, receipts and the like, and generate reports.

• To get really futuristic check out iTrackMine, a free web-based resource billed as the “ultimate collection manager”.  By typing in (or scanning with a barcode scanner or an Android phone) the ISBN or UPC numbers of items in a collection, such as books or movies, you can automatically generate a list containing all kinds of information, including pictures.  Where it’s really useful for home inventory purposes is its ability to produce an insurance-ready report.

Why not make the doing of a household inventory a family project this holiday season?  While giving new meaning to the expression “making a list and checking it twice”, you’ll end up with a worthwhile gift for yourself and your family!

Comments or questions about this article?  Call or text me at 780-910-9669, email me at barry@barryt.ca, or contact me here. 

Do you have a mortgage on your Spruce Grove, Stony Plain, Parkland County or Edmonton area home coming up for renewal?  Do you expect the process to be just another rubber-stamping, or could there be problems?  A piece of legislation that came into effect on June 21, 2012 could cause you some grief if you have ever had any issue in your credit history. 

The mortgage debt crisis in the US of a couple years ago had people on this side of the border calling for tight controls on lending to prevent a similar calamity in Canada.  The Office of the Superintendent of Financial Institutions (OSFI) responded with several initiatives, such as decreasing the length of mortgage amortization to a maximum of 25 years from the previous 35 years, and limiting borrowing on a home equity line of credit to 65% of the home’s value from the previous 80%, among other things.  (See my blog articles:  “Changes to Mortgage Rules”  and “HELOC Rules Changing”)

A guideline from the OSFI that went into effect on June 21, 2012 (Guideline B-20 – Residential Mortgage Underwriting Practices and Procedures) is apparently being interpreted by some lenders to mean that a heavier hand is needed in assessing applications for mortgages and their renewals.  This means that people who were delinquent on bills in the past but who have now brought payments up to date and are now prepared to enter into a home purchase with an acceptable down payment, good income and so on are being denied a mortgage or a renewal of their mortgage.

Reading through the guideline and its accompanying information would suggest that there is a very broad base for interpreting it, making the scenario of sweeping mortgage denials possible.  But the guideline itself, as policy for Federally-Regulated Financial Institutions (FRFIs) to formulate their own rules and regulations around their money lending practices, contains cautionary wording that would seem to prevent such refusals, urging FRFIs to be reasonable in their procedures:

“Background and Credit History of Borrower

FRFIs should ensure that they make a reasonable enquiry into the background, credit history, and borrowing behaviour of a prospective residential mortgage loan borrower as a means to establish an assessment of the borrower’s reliability to repay a mortgage loan.

For example, a credit bureau score, offered by the major credit bureaus, is an indicator often used to support credit granting. However, a credit score should not be solely relied upon to assess borrower qualification, as such an indicator measures past behaviour and does not immediately incorporate changes in a borrower’s financial condition or demonstrated willingness to service their debt obligations in a timely manner.”

Fortunately, there are many lenders who recognize that their job is to do what they can to help their clients!  Fran Jenkins, Mortgage Specialist with ATB Financial in Spruce Grove, comments:

“First, I do not see any drastic tightening of credit lending at this time.  I have been aware in the past 3 years of such lenders as MCAP and Resmor Trust requesting full payment of mortgage funds at time of renewal.  These companies tend to operate differently than Chartered Banks and ATB Financial.

“Low credit scores do not automatically cause an application to be declined.  That is why there are individuals such as myself, with experience in lending, that can explain the reasons for the credit scores and do a full financial analysis to support an application.  Otherwise, if system generated, very few applications would be approved…

“I agree with the statement that slow payments is cause for concern on a lending application however there are many reasons why a client may have these slow payments.  Yes, keeping one’s payments up to date is important however not always possible.  This is what your Mortgage Specialist must understand.

“Today is no different than 20 years ago in the lending environment. You will be granted a Mortgage and/or Mortgage Renewal going thru the same process…..what is imperative is having the right Mortgage Lender supporting you as a client and going above and beyond expectations to make sure you are being presented in the correct manner.”

Fran Jenkins goes on to point out that it is true fewer high-risk applications are being approved these days, but even in boom times these borrowers should not have been approved.  High risk clients are those with bad credit who have neglected making payments for extended periods of time or who have even refused to pay back debts. 

Bottom line?  Chances are, if you have been conscientious about maintaining a good credit history and have a decent record of taking care of your debt load, the odd slip won’t be held against you.  And the trick is to shop around for a lender who will work with you to find the right mortgage for you.

Thanks to Fran Jenkins of ATB Financial for taking the time to provide her wisdom on this complicated topic!  You can contact her here:

FRAN JENKINS, B. Comm

Mortgage Specialist, ATB Financial

Cell  780 722 2266 |  Fax  1 888 722 8291

Toll Free 1 855 375 5022

EMAIL: FJenkins@ATB.com

Comments or questions about this article?  Call or text me at 780-910-9669, email me at barry@barryt.ca, or contact me here.

Do you have a HELOC (Home Equity Line of Credit) against your home in Spruce Grove, Stony Plain, Parkland County, the Edmonton region or elsewhere?  This valuable lending tool has many practical uses:

• Investment borrowing
• Borrowing for education
• Rental property investment
• Home improvements
• Debt consolidation
• Alternative to higher-rate loans
• Down payment source for a second property
• Emergency backup fund

At the moment a HELOC can allow homeowners to borrow up to 80% of their home’s appraised value at very reasonable interest rates.  But that is about to change within as short a time period as 3 weeks.

Fran Jenkins, Mortgage Specialist at ATB Financial in Spruce Grove, advises that the OSFI (Office of the Superintendent of Financial Institutions in Canada) has set out new lending guidelines for all federally regulated lenders to limit new HELOCs to 65% Loan-to-Value.  Banks have until the end of their fiscal years to comply, and for most banks in Canada, that means October 31, 2012 (up to March 31, 2013 for other institutions such as credit unions).  Expect to see most banks moving on this well before the official deadline.

While OSFI says that existing HELOC holders will be grandfathered, you may want to check with your bank to ensure that your HELOC is set up the way you want it, especially if you need a HELOC equaling 66% to 80% of your home’s value.

The new rules also affect readvanceable mortgages.

For more details on the new mortgage rules, read the article “OSFI Toughens Mortgage Underwriting” from Canadian Mortgage Trends.com.

Comments or questions about this article?  Call or text me at 780-910-9669, email me at barry@barryt.ca, or contact me here.

Looking to buy your first home in Spruce Grove, Stony Plain, Parkland County or the Edmonton region?  The provocative question in the title of this blog entry is the opening line  of “Strategy for first homes“, an article from the January 28, 2012 edition of the Edmonton Journal (reprinted from the Financial Post).

The Canadian RRSP allows tax-payers to save money for retirement while getting a break on taxes.   Once withdrawn, taxes must be paid, and the amount can never be put back into the RRSP – with one exception.  First-time home buyers needing money for a down payment are allowed to borrow up to $25,000 (tax-free) from their RRSP funds, and they have up to 15 years to repay the amount.

But!  After reading the article, first-time home buyers might think twice about doing this.  The article explains with specific examples the permanent financial blow this deals to one’s retirement fund and subsequent retirement income.  Because the RRSP contains pre-tax dollars, the potential earning power of this money is greater than funds saved in other ways, and the loss of earning power is therefore greater also.  Loss of growth in one’s savings for retirement might be at least partially off-set by savings occurring from having a smaller mortgage, but prospective home buyers will need sharp pencils to calculate if this works for them.

Read the full article to see if this strategy is the best choice for you.

I work with mortgage brokers who can help you figure out the best way to get into the house you want.  Call me today at 780-910-9669, email me at barry@barryt.ca, or contact me here.