In a newly bold move to tackle the pressing housing crisis, the Canadian federal government has unveiled a comprehensive plan aimed at addressing the dire shortage of homes across the nation. With billions of dollars in spending commitments, this ambitious initiative is poised to revolutionize the housing landscape, offering hope to millions of Canadians struggling to find affordable housing solutions.

Prime Minister Justin Trudeau, flanked by key ministers and eager apprentices, recently announced the groundbreaking plan, emphasizing its unprecedented scale and scope. Divided into three pillars, the plan focuses on building more homes, facilitating homeownership and rental accessibility, and providing support for those unable to afford adequate housing.

Building a Brighter Future: Constructing 3.9 Million Homes by 2031

Central to the government’s strategy is the commitment to build nearly 3.9 million homes by 2031, a monumental endeavor aimed at alleviating the housing shortage. Leveraging a combination of tax incentives, policy reforms, and financial support, the plan aims to incentivize homebuilders to ramp up construction activities. Key initiatives include the $15-billion Apartment Construction Loan Program and efforts to streamline regulatory processes to expedite building approvals.

Furthermore, the government plans to harness innovative technologies such as modular and prefabricated homes to accelerate construction timelines. A strategic “public lands for homes” approach will also unlock surplus federal land for housing development, maximizing available resources to meet growing demand.

Empowering Homeownership and Rental Accessibility

Recognizing the challenges faced by renters and aspiring homeowners, the government has outlined measures to enhance affordability and accessibility. A tenant protection fund will provide legal support and advocacy for renters, safeguarding their rights against unfair rent hikes and evictions.

Moreover, initiatives such as the Canadian Renters’ Bill of Rights and the extension of mortgage amortization rates aim to level the playing field for renters seeking homeownership opportunities. By allowing rental payment history to improve credit scores, the government aims to empower responsible renters to qualify for mortgages, fostering a path to homeownership.

A Compassionate Approach: Supporting Vulnerable Communities

Acknowledging that not all Canadians can afford housing, the government has committed to supporting vulnerable populations through targeted interventions. The Affordable Housing Fund and Canada Rental Protection Fund will finance the construction and preservation of affordable housing units, ensuring that individuals and families have access to safe and secure accommodations.

Housing Minister Sean Fraser emphasized the government’s duty to address homelessness and housing insecurity, underscoring the moral imperative of providing adequate housing for all Canadians.

Navigating Provincial Dynamics: A Call for Collaborative Action

While the federal government’s plan offers a beacon of hope, it acknowledges the need for collaboration with provincial and municipal counterparts. Despite potential resistance from certain provinces, Trudeau has affirmed the government’s commitment to work collaboratively, urging provinces to join forces in tackling the housing crisis.

By adopting a collective “team Canada” approach, the government aims to overcome bureaucratic hurdles and accelerate the implementation of housing solutions. Key to this endeavor is the alignment of regulatory frameworks and the adoption of expedited permitting processes to facilitate timely construction projects.

Embracing Innovation: Harnessing Technology for Sustainable Solutions

In addition to traditional approaches, the government is embracing innovation as a cornerstone of its housing strategy. By investing in research and development, the plan aims to leverage emerging technologies such as green building materials, energy-efficient design, and digital construction methods.

Through initiatives like the standardized housing design catalogue and the support for modular and prefabricated homes, the government seeks to revolutionize the construction industry, driving efficiency and sustainability. By embracing innovation, Canada can build a housing infrastructure that not only meets current needs but also anticipates future challenges.

Conclusion: Towards a Brighter Housing Future

As stakeholders weigh in on the government’s plan, optimism is tempered with realism regarding the challenges ahead. While the proposed initiatives offer tangible solutions, the road to housing reform will be long and arduous.

Nevertheless, with steadfast determination and concerted effort from all levels of government, Canada stands poised to usher in a new era of housing affordability and accessibility. As the nation embarks on this transformative journey, the vision of a future where every Canadian has a place to call home shines ever brighter.

Take Action: Join the Movement for Housing Justice

Now is the time for action. As citizens, advocates, and policymakers, we all have a role to play in shaping the future of housing in Canada. Whether it’s advocating for inclusive zoning policies, supporting affordable housing initiatives, or engaging in community-driven solutions, our collective efforts can make a difference.

Contact your local representatives, volunteer with housing organizations, and stay informed about housing policies and developments. Together, we can build a more equitable and sustainable housing landscape for generations to come. Join the movement for housing justice today.

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Introduction

As we step into the new year, the ever-evolving real estate and mortgage landscape presents opportunities and challenges for potential homebuyers. This blog distills crucial insights from some of our most important blogs from 2023, providing a detailed guide on what’s important to know as you navigate the complexities of the current real estate market.

Important Things to Know Going into the New Year

Standing at the threshold of a new year, it becomes imperative to stay abreast of the ever-changing market dynamics and the high cost of homeownership. Strategic home investment takes center stage, with the use of mortgage calculators highlighted as game-changers in gaining a realistic perspective on affordability.

It is crucial to understand common pitfalls, such as overextending oneself. GLM Mortgage Group emphasizes that homeownership should enhance, not hinder, one’s lifestyle. Maintaining a balance between aspirations and financial feasibility is key to ensuring that the dream of owning a home doesn’t become a restrictive burden.

Navigating the Vancouver Real Estate Market

GLM Mortgage Group’s expertise in guiding first-time homebuyers through the dynamic Vancouver real estate market shines in our blogs. The journey to homeownership is portrayed as an exciting milestone marked by stability and the freedom to shape one’s living space.

Strategic home investment remains paramount, and we emphasize the need for a balance between aspirations and financial feasibility. Our guidance is positioned as crucial for making informed decisions in the Vancouver housing market. GLM Mortgage Group’s extensive experience positions him as a trusted advisor, ensuring that the first home purchase aligns seamlessly with long-term goals.

Canadian Mortgage Charter: Unlocking Financial Freedom

Explored in the Fall Economic Statement, the Canadian Mortgage Charter emerges as a groundbreaking initiative designed to bolster transparency and safeguard vulnerable borrowers. This blog we wrote a few months ago delves into its core tenets, emphasizing its role in ensuring fair treatment for those facing financial challenges.

The comprehensive guidelines within the charter are unpacked, ranging from temporary extensions and fee waivers to stress test exemptions. The blog encourages potential homeowners to understand these principles, empowering them to make informed decisions and contribute to the ongoing evolution of fair lending practices.

Securing Your First Mortgage in Vancouver, BC: The Path to Your Dream Home

GLM Mortgage Group’s commitment to helping first-time homebuyers is again highlighted in other blogs throughout the year, emphasizing the importance of securing the first mortgage as a significant milestone in the path to homeownership.

Understanding the complexities of securing a first mortgage, including budgeting, credit health, and additional costs, is crucial. The advantages of working with a trusted mortgage broker for expert guidance, and the significance of mortgage pre-approval is emphasized to provide clarity on eligibility and responsibilities.

The Impact of Down Payment on Your Mortgage: Insights from Our Calculator

Down payments are something to always understand. The use of mortgage calculators can help you make informed choices. The minimum threshold of 5% for entering the market and explores the implications of down payments on the overall cost of homeownership.

Substantial down payments are unpacked, showcasing their impact on monthly financial commitments and the reduction of interest payments over the mortgage term. The blog stresses the importance of finding a balance that suits financial comfort and long-term goals, irrespective of the commonly perceived ‘golden rule’ of a 20% down payment.

Conclusion

As you embark on the journey of homeownership in the new year, these comprehensive insights offer a roadmap to navigate the dynamic landscape. From understanding market dynamics and the Vancouver real estate market to decoding the Canadian Mortgage Charter, securing your first mortgage, and evaluating down payments, staying informed is the key to making confident decisions on your path to financial freedom. 

Whether you’re a first-time homebuyer or contemplating a move, let these insights guide you through the intricacies of the current real estate landscape, empowering you to take the next step in your homeownership journey with knowledge and confidence.

Don’t forget, we are always just a phone call away. Call us today!

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Unlocking Your Dream Home: The Advantages of Working with a Mortgage Broker in Vancouver, BC

In the dynamic Vancouver real estate market, finding your dream home can be both thrilling and overwhelming. Whether you’re a first-time homebuyer or looking to upgrade, the decision to work with a mortgage broker, such as Geoff Lee from GLM Mortgage Group, can significantly enhance your home-buying journey. In this blog post, we’ll explore the numerous advantages of collaborating with a mortgage broker in Vancouver, BC, and how it can make your experience not only seamless and enjoyable, but also cost-effective.

Cost-Effective Homebuying

One of the primary advantages of working with a mortgage broker is the potential for significant cost savings across the board. Geoff Lee, a trusted mortgage broker in Vancouver, can help you secure your dream home at a wholesale price rather than the market price. This distinction can result in substantial savings, making homeownership more attainable.

Additionally, mortgage brokers have the ability to shop around for the best deals on your behalf. By leveraging their industry connections and expertise, they ensure you get the most favorable terms and interest rates. This personalized approach to securing a mortgage can translate into long-term financial benefits, setting you on a path towards a more stable and cost-effective homeownership experience (and a less stressed one). 

Customized Homebuying Experience

One size does not fit all in the world of real estate, and a mortgage broker understands this well. When you partner with a professional like Geoff Lee, you gain the advantage of a personalized and flexible homebuying experience. Communicate your financial constraints, preferred down payment amount, and budgetary limits, and let the broker tailor the search to match your unique requirements.

Whether you’re a first-time homebuyer with limited funds for a down payment or an experienced homeowner seeking a specific price range, a mortgage broker can work with you to find the ideal home that aligns with your financial goals and lifestyle. This level of customization sets mortgage brokers apart, offering a tailored approach that surpasses the often rigid options provided by banks or other financing alternatives.

Streamlined Closing Process

Time is of the essence in the competitive Vancouver real estate market. One of the standout benefits of working with a mortgage broker is the ability to close on your dream home faster. Mortgage brokers like Geoff Lee possess the knowledge and experience to navigate the intricacies of the home-buying process, eliminating potential hassles and delays that can arise when navigating the market independently.

By entrusting a mortgage broker with your home search, you benefit from a streamlined and efficient process that accelerates your journey to the closing table. This ensures that you can move into your new home swiftly, avoiding unnecessary delays and complications.

A Flexible Buying Experience

Navigating the Vancouver real estate market alone can be a daunting task, leaving you vulnerable to unforeseen challenges. Mortgage brokers offer a flexible buying experience by working closely with you to identify the options that best suit your needs. Whether it’s determining optimal price ranges, negotiating favorable terms, or securing features within your budget, a mortgage broker acts as your advocate throughout the entire process.

Don’t let the complexities of the real estate market dictate your homebuying experience. Collaborate with a mortgage broker to gain insights, explore various options, and make informed decisions that align with your goals.

 Conclusion

Are you ready to embark on a home-buying journey that prioritizes your preferences and financial well-being? GLM Mortgage Group, led by experienced mortgage broker Geoff Lee, is here to guide you. Our team of dedicated professionals is committed to providing a customized and efficient home-buying experience for residents in Vancouver, BC.

If you’re eager to learn more about how working with a mortgage broker can enhance your homebuying experience, contact GLM Mortgage Group today. Our established team is ready to answer your questions, address your concerns, and help you navigate the intricacies of home loans in Vancouver, BC. Unlock the door to your dream home – contact GLM Mortgage Group and let us lead you to a better way of buying real estate.

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Are you worried about the price of your home dropping even further then they have today? It is understandable but before you worry too much, let me try to ease your concerns as allow home prices are falling, they are likely not expected to fall much further. The reasoning behind this, according to the CMHC deputy chief economist is because of the housing shortage.

If the shortage stays low and the demand even just stays the same, then housing prices are likely to hit a stand still soon and middle out the market. Also, it is important to note that homes median value have fallen only 2.8% from the end of 2021 to the fourth quarter of 2022. The aggregate price was down 2.3% on a quarter-over-quarter basis to mark the third consecutive quarterly decline.

Does this feel less low than you thought?

That is likely, and to spring better news, the aggregate home price in the fourth quarter of 2022 was up 13.8% compared with the same quarter in 2020 and 17.2% higher than in the fourth quarter of 2019. It is understandable if you feel like you struck during the buying spree of 2021 and first half of 2022 because you bought your property too high. However, you should remember 2 things:

• You should only enter the real estate market when you are ready.
• If you move or sell and feel you lost value, you must remember the property you moved to likely also lost in value. Of course, it is dependent on where you move to, but it is still an important thing to remember.

Ok now back to our main topic, Is this house shortage good news?

It entirely depends on which demographics you are coming from and how you are approaching the real estate market.

Approaching the market is just like what we talked about above; If you move or sell and feel you lost value, you must remember the property you moved to likely also lost in value. Of course, it is dependent on where you move to, but it is still an important thing to remember.

Demographics

This is not the first, second or third time we are bringing this up, but entering the market as a first-time home buyer has still never been harder. Not only are prices of homes not correlating to the value of salaries, but the supply of homes is very low. Construction on new homes has gone down and the demand is only becoming higher and higher. We have talked about different incentives that can help first time home buyers find homes but unfortunately without the proper supply of homes, it is harder to find a suitable place to live.

Do not let this bring your hopes down. New condos, apartment, townhomes, and more are thought about and put on an agenda every day. Local elections just took place in the Fall and many councils like to start out strong but proposing infrastructure in the likes of places to live. These will start to ramp up and we believe that opportunities for first time homer buyers to enter in the near time future will improve. For now, take a look back at this blog that helps you understand more about the first time home buyer incentive.

For people who recently entered the market and are still making payments towards their mortgage, have likely seen a large chunk of their payments going to interest only which is not fun. Yes, it may feel like you’re paying rental fees again, but it is important that this will not last forever and millions of people are in the same boat.

For everyone who has paid off their home would likely be happy to hear that the market is not likely to dip much, but as always, the market fluctuates and if you are planning to live in that home for the foreseeable future, expect market shifts again.

Conclusion

Yes, there is likely to be a newfound stagnant in the housing market. We urge you not to obsess over housing prices. Just like you should not watch your stock all day, it is important to take a step back and enjoy each day. As always, we are here to help you answer any questions you may have. No one knows where this year is going to go with housing prices, inflation, key interest raises, recession fears, and more. Hold tight, but also focus on your situation first before you worry about your surroundings.

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Real Estate is always a great conversation starter.

Earlier this year we did a blog on the statistics of first time home buyers and the challenges that come with being a first time home buyer. Today we are going to discuss the reasons why getting into the market is still a great idea and although being a first time home buyer has never been harder, the path to buying real estate is still a rewarding journey. 

We understand that in today’s age, lots of young people are wondering if they will even have the opportunity to enter the real estate market. A lot of young people are also wondering if it is even worth entering the real estate market with the way the market has been the past few years. We are here to tell you that it is still a great idea and here is why. 

Carlos Miramontez, the Vice President of mortgage lending at Orange County; Credit Union in California recently said that “owning a home is how most Americans build wealth. A portion of every housing payment made by a homeowner is applied toward paying down the home loan balance (principal payment), which increases the equity in the home and helps to build a homeowner’s net worth.”

Canadian households have seen their net worth rise significantly due to the COVID-19 pandemic. If you are a homeowner then your net worth is likely rising 3X more then average just due to the surge in home prices, and 80% of net worth rises in millennial is due to the fact of the rise in the home(s) they own.

We understand that sometimes starting out in real estate is not something you can do right away, and that financial assistance from relatives is not something that everyone can afford. The truth is though, that a financial net worth of greater than enter counterparts is not just because of financial luck passed down from generations. Owners are more likely to be financially smart and focus on important budgeting and cost of living tools for all aspects of their life and not just their home. Even if you can not enter the market for years to come, just working your way towards that goal will lead to increased financial understanding, increased desire to save money for future goals, and an increased awareness of every financial decision made. 

As you prepare to start creating financial plans to save for your entrance into the real estate market, understand that it is important to create a goal before entering the market. This is important because you want to have enough money saved for emergencies as well as for some retirement savings and a low debt-to-income ratio on top of a dependable income first. You also will want to plan for the closing costs of buying a home which can range from 2-6% of the purchase price depending on the type of loan, the type of property, the location and other factors. 

We know that it is hard to enter the real estate market right now, and we understand it is not always easy to look at silver linings. Financially, saving towards the purchase of a home is a smart tactical decision. Do not feel you need to pressure yourself to this “ideal” of when a home should be purchased, just focus on what is best for your needs and how you can get there in the timeframe that makes sense to you. Understand that someone else’s ideal does not have to be your ideal, and it is best to go at your pace so that you do not fall down a hole because you kept yourself too tight on money for too long. 

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Rent to Own Mortgage

A Rent to Own contract could be the answer for someone who is renting but is also having a hard time getting their down payment together. Rent to Own contracts usually are between 1 and 5 years long and can give the client the time they need to implement strategies on increasing their down payment or even improving their credit.  As one of the Top 3 Rated Mortgage Brokers in Vancouver, we would be more than happy to assist you with understanding Rent to Own Mortgages.

In the Lower Mainland, Rent to Own is becoming more popular as housing prices are increasing, and renting seems inevitable. In fact, there are properties that are being built with Rent to Own financing in mind.

Initially, the contract is signed just between the renter (the buyer) and the Landlord (the seller) that states an agreed price, length of time of Rent to Own, and market rent (typical rent of a similar property) with the excess going toward down payment (usually $200 – $400/month). The lender is not involved yet.

For example, market rent for your property goes for around $1000.00. You agree to pay the Landlord $1400.00/month. The extra $400/month goes into an account that the Landlord has in place for you for the down payment. This is a great example of  a Rent to Own situation.

Regardless of the lender, the Landlord must keep pristine records of the extra money coming in and can show the history of any excess deposit. When the Rent to Own is registered on title, there will be a clear indication as to how much of the monthly payments are directed toward the deposit.

The client will want to work with a team of property purchase professionals that will strategize Action Steps to make a seamless Rent to Own experience. The client`s team would be:

1. MORTGAGE PROFESSIONAL

• Get pre-approved! In the pre-approval process, the Mortgage Professional will be able to advise on improving credit or the need to increase employment income if need be.
• As well, the Mortgage Professional understands lender policies and guidelines for Rent to Own contracts and will be able to advise on how to properly set up the Rent to Own.

2. SOLICITOR/LAWYER

• Make sure that your lawyer is familiar with Rent to Own contracts and that they work closely with the Mortgage Professional who knows what the lender is going to expect. This relationship is very important and one that should not be overlooked.

The down payment continues to grow over the life of the Rent to Own contract. At any time, you can add lump payments to the down payment, simply by giving the Landlord a bigger rent check. Keep in mind, the Rent to Own contract could stipulate that the down payment is non-refundable. Make sure you read the fine print and work closely with your mortgage professional and lawyer so that you clearly understand the terms of your Rent to Own contract.

The bank does not get involved until the time the renter (the buyer) makes an offer to purchase to the Landlord (the seller). The person paying for the rent to own does not have to qualify for a mortgage at this point because the Landlord continues to carry the mortgage on the property.

Rent to Own Properties can also be facilitated through a company such as a condominium developer. For example, the developer could offer a Rent to Own contract when entering a rental lease with an owner-occupied property that the client wants to rent.

The client may be charged a contract fee upfront (for example $10,000) to enter the Rent to Own contract. At times all or a portion of this contract fee can be used toward the down payment pending on what has been negotiated within the Rent to Own contract.

Over the course of the Rent to Own some of the obstacles to financing you will consider are:

• How to improve your credit rating
• Consider applying for an RRSP loan to further establish credit and take advantage of tax benefits
• Consider refinancing any outstanding credit
• Consider job changes to increase employment income
• Consider other sources to increase down payment

Rent To Own contracts are more than just paying rent to the Landlord and applying the rent toward the purchase of the property. There are details that you need to know when entering into a Rent To Own Contract. If you need help setting up a Rent to Own contract or for more information regarding this topic please reach out.

GLM Mortgage | Dominion Lending Centres is here to walk your mortgage planning path with you. Give us a call at 604-259-1486 and find out what your mortgage options are!

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Bridge Financing

Bridge Financing, also commonly referred to as a “Bridge Loan”, is a way to help literally bridge the gap between closing on your current house and your new place. This product allows you to carry the mortgage on two properties for a specified amount of time and for typically a maximum of 90 days. As one of the Top 3 Rated Mortgage Brokers in Vancouver, we would be more than happy to assist you with understanding Bridge Financing.

How does Bridge financing work? These short-term loan products use your current home’s equity to cover some of the costs of your new home (for example, could be used for a down payment.) That way, you don’t have to miss out on your dream home while waiting on the cash from the sale of your current house.

What is the cost of Bridge Financing? You will be charged an interest rate on the amount of funds you are borrowing. This will be based on the lender’s prime rate and will vary. You can expect to pay prime plus 2-5%. You can also plan to pay an administrative fee. This will vary pending on the lender and can range from $200-$695.

Similar to most other financial decisions, there will always be advantages and disadvantages for Bridge financing. Here are a few things you should be aware of:

One of the most popular advantages of acquiring Bridge financing is financial flexibility. With this product, you will be able to use the equity you’ve built in your current home to secure the new purchase of your dream home. Since you will be able to access those funds via equity, you won’t have to stress about the sale closing of your current home before you close on your new home.

Although most terms for Bridge financing products are short, the interest rate will be similar to open rate mortgages, which are often higher than the interest rate you may have locked in with your current mortgage. If for some reason your sale agreement falls through on your current house, you may have to make up for the payments until a new sale is finalized.

To qualify for Bridge financing you will need:

• Have a current mortgage in good standing with equity
• A copy of the Sale Agreement for the home you’re selling
• A copy of the Purchase Agreement for the home you’re buying
• Valid pre-approval (with document review) with the lender of your choice

Like your home buying situation, your home financing needs are unique. Bridge financing may be the right solution for you if you would like the following…

• You’ve found your dream property and do not want to wait on submitting your offer
• You can’t afford a down payment without the money from your current home’s equity
• You want time between closing dates

If you’re a homeowner aged 55 and over, rather than taking out a regular Bridge loan, you could take out a CHIP Open Mortgage with HomeEquity Bank. The CHIP Open Mortgage can assist you in purchasing a new home when your existing property has not yet been sold.

Let’s have a look at this case study together…

• Meet the Ellis family, a couple in their early 70s who live in the Greater Vancouver Area in a home worth $1.3 million. Looking to downsize, they’re keeping an eagle eye on available properties on Vancouver Island, and finally find their dream home at a price tag of $550,000. Afraid to lose it, they act quickly to purchase the new place before selling their existing home — but don’t qualify for a large enough traditional loan, putting the dream they have for their future in jeopardy.
• This product is a CHIP Open Mortgage (A Reverse Mortgage with no pre-payment penalties) The couple was able to access $600,000, allowing them to purchase their new place outright and cover the costs of their move. With no repayments, the couple were able to properly prepare their home for sale and repaid the CHIP Open in full once the house sold.

Please reach out and one of our Senior Broker Partners would be more than happy to assess your unique situation and give you the best advice. At GLM Mortgage Group, we are with our clients for the entire journey. From the beginning, we can identify client needs, any possible roadblocks, and give a variety of tailored solutions.

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Increasing Your Purchase Power

Most individuals that we connect with to discuss a Mortgage Pre-Approval also want to know how we can go about Increasing Your Purchase Power. More often than not, those individuals could afford to make mortgage payments. Usually, they already pay monthly rent in the same amount as a mortgage, or perhaps even more! As one of the Top 3 Rated Mortgage Brokers in Vancouver, we would be more than happy to assist you with your Purchasing journey.

Part of our process as Mortgage Brokers at GLM Mortgage Group is to connect with new clients with a Discovery Call, which involves key questions on important factors of a Mortgage Approval. We spend 10 minutes gathering information on income, credit, and down payment and with that, can provide a possible purchase price, and a piece of mind to shop within one’s budget.

Sometimes at the end of the conversation, we find that an individual may not be able to purchase within the price range they had planned to and brings us back to the drawing board to discuss options and a gameplan for the Increasing Your Purchase Power in the future.

Now, the reason that someone may not qualify for a mortgage that they could afford payments on, is due to the Stress Test, which newest rules were released in June 2021 and decreased borrowing power by 25%. To pass the mortgage Stress Test, you need to qualify at the contract mortgage rate plus 2% or the benchmark rate of 5.25%, whichever is higher. The purpose of the Stress Test is to ensure that should interest rates rise – a borrower will still be able to afford their mortgage payment.

This is a tactic by the Bank of Canada to ensure that consumers can withstand rising interest rates, as well as tackle household debt issues in Canada by preventing consumers from getting into further debt – but it greatly affects your purchase power, as you will qualify for less.

There are a few options to consider, that can help Increasing Your Purchase Power, potentially bypass the Stress Test and qualify for the purchase you are hoping to make.

First, down payment – if you have 20% down payment, this can provide various options that will allow you bypass the Stress Test, which will increase purchase power. Local credit unions are provincially regulated and therefore can allow you to bypass the Stress Test, although this comes with a slight rate premium. Secondly, having a 20% down payment can also make Alternative Lending an option – but be sure you understand this, as it may be easier to qualify, but these interest rates will be higher and could cost you more in the long run.

Nonetheless, with a 20% down payment – there are two viable options to Increasing Your Purchase Power in the Pre-Approval stage.

Further advice that we share with new clients, when we find they may not qualify for what they hoped is bringing a Co-signor to the mortgage. This could be a friend or family member that will be on the mortgage with you, and on the title of the property as little as 1%. We would be able to factor their income, assets, and debts into the equation to increase the purchase power. The primary borrower is still responsible for making mortgage payments, but the co-signor is there as a back up, and is required to make payments should the primary borrower default.

Another solution to Increasing Your Purchase Power is to increase the down payment.

This could mean putting your plans to purchase on hold for another 12 months while you continue to save, perhaps withdrawing RRSP or other Investments or even a gift from a family member may be possible. Given the current market conditions, we are seeing family members offer financial aid to their kids and grandkids to make home ownership possible for them.

Lastly, to help with Increasing Your Purchase Power, you can INcrease household income and DEcrease household debt. Although these options have a positive effect on purchase power, it takes time to see these effects take place. Perhaps obtaining a second part time job is possible, to increase income – but keep in mind, lenders will want to see this sustained for 2 years to consider the income. Also, decreasing debt will increase purchase power significantly.

For every $14,000 of debt that we carry, or $400/month payment, our borrowing power is decreased by $100,000. If you have a significant down payment, it’s always more advantageous for qualifying, to use a portion to pay down debts. It’s important to understand tips like this as they will contribute to Increasing Your Purchase Power.

At GLM Mortgage Group, we are with our clients for the entire journey. From the Discovery Call, we can identify client needs, any possible roadblocks, and a variety of solutions. Our brokers know how to Increasing Your Purchase Power and know how to assess your unique situation, giving the right advice so you can best move forward in your plans to purchase a home.

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