CategoryCase study

Posted March 13, 20184 Comments Case study

Credit counselling, Consumer proposal or Bankruptcy… Which option is most favourable?

A couple in their 30s contacts me for a mortgage. They want to buy a new home. She’s a high school teacher and he’s a computer firm manager. Incomes are good. I check their credit.

Let’s stop here for a minute… If they have good credit, an approval is simple and we can provide the clients with several mortgage options.

But let’s assume that this couple ran into some debt and credit issues three years ago… and they made three different choices about how to resolve those credit problems: 1) Credit Counselling; 2) Consumer Proposal; or 3) Bankruptcy. I want to take you through each scenario and show you how long each of these three options affects your ability to finance a home. I bet the results will surprise you! Continue reading “Credit counselling, Consumer proposal or Bankruptcy… Which option is most favourable?”

Posted October 19, 2016 Case study

Mortgage brief…Is it worth changing your mortgage today?

Mortgage rates have never been lower. Should you break your current mortgage to take advantage of the lower rates? The answer is ‘yes’ and ‘no’.

YES….if the penalty to break your mortgage is less than the potential savings. We are seeing many opportunities today where it PAYS to break your mortgage and get into today’s lower rates.

EXAMPLE for one client.. Existing mortgage is $275,000. The existing rate is 2.99% with 3 years to go. The penalty to exit is $3500. The current 3 year rate is 2.24%. Gross savings is $5602. Net savings is $2102.

NO… if the penalty to break your mortgage is less than the potential savings. EXAMPLE.. Penalty is $6500 and Gross savings is $5602. Net loss is $898.

YES… if you think interest rates are going to be much higher in the next few years, you may still want to bite the bullet, pay the penalty and lock into a longer term fixed rate mortgage. Everyone is different and has different needs, risk tolerances, plans. This is a personal choice.

I’ve seen examples of both situations. You could save money by breaking your mortgage. The best advice is to speak with an experienced Mortgage Broker. Get an UNBIASED opinion.

Your best interest is my only interest. I reply to all questions and I welcome your comments. Like this article? Share with a friend.

Steve Garganis 416 224 0114 steve@mortgagenow.ca

Posted April 29, 2015 Case study

Online shopping for Stocks, Vacations and Mortgages. An In-depth comparison…

IS CHOOSING A MORTGAGE IS AS EASY AS BOOKING A TRIP OR TRADING A STOCK?…LET’S FIND OUT!

Sure, you can book a flight online or a buy a stock through the web. But, can you really choose the right mortgage product on your own? Can you really find the absolutely lowest cost mortgage financing option? I’ll bet some consumers can. I’ll also bet the vast majority cannot…. and there’s a steady stream of horror stories, on this news site and others, that show just how costly and financially dangerous it is to be in the wrong mortgage product, with the wrong lender.

I’ve shared dozens of those experiences on this site. Consumers who were directed into the wrong mortgage by their Banker or by some web site claiming to offer ‘the lowest rate’. I empathize with these consumers as I believe they were just trying to save some money but instead ended up paying far more than they had to. Continue reading “Online shopping for Stocks, Vacations and Mortgages. An In-depth comparison…”

Posted March 2, 2015 Case study

Rate shopping sites…tested again.. and failed again.

A few years ago, I published a study on Rate shopping sites. These sites were gaining popularity with consumers as a place to go if you wanted to get the best rates. And they attracted a lot of attention.

You know the sites… they have catchy ads like ‘shopping for the Best Mortgage rates in Canada’ or ‘comparing Canada’s mortgage brokers for the best rates’.
Hey, who doesn’t want the best rate? These ads work. Canadians were clicking these links to get more info.

Sounds great, right? Yet, it’s not.
Continue reading “Rate shopping sites…tested again.. and failed again.”

Posted December 11, 20142 Comments Case study

Housing bubble? Waiting for the crash before buying has cost you 60% in the last 6 years.

Bad news travels 10 times faster than good news! It’s just human nature that we can’t seem to escape. We seem more likely to gossip about someone’s misfortune than their accomplishments.

Here’s a negative headline…. YOU LOST APPROXIMATELY $355,000, SO FAR, IF YOU’VE BEEN WAITING TO A BUY HOUSE SINCE 2008. Read on to see understand how and why.

Take Wednesday’s headline in the Financial Post, “Bank of Canada warns house prices are overvalued by up to 30%” . WOW! How’s that not gonna get your attention? It certainly got mine. I immediately had to read this article. But the more I read, the clearer it became that this statement wasn’t exactly true.

The article pointed to a semi-annual report that is put out by the Bank of Canada entitled, Financial System Review December 2014. That headline is an attention grabber.. And like most media headlines, it’s not the full story. In fact, it’s not an accurate reflection of what the Bank of Canada report had to say. If you look at Stephen Poloz’s (Bank of Canada Governor) comments, he says “there is some risk that the housing market is overvalued, and our estimates fall in the 10 to 30 per cent range”.

But he’s not done there.. Continue reading “Housing bubble? Waiting for the crash before buying has cost you 60% in the last 6 years.”