Buying vs. Renting

General Trish Pigott 31 Aug

At some point in their lives, most Canadians have probably asked themselves whether it is better to buy or rent a home. And purchasing a home is one of the biggest decisions most people ever make.

Ultimately, the decision is a personal choice, but it helps to look at the pros and cons of buying to determine whether home ownership is right for you.



Some advantages of buying a home

Owning a home is generally considered to be a sound, long-term investment that can provide satisfaction and security for you and your family.Each month when you make your mortgage payment, you are building equity in your home.

Equity is the portion of the property that you actually build through your monthly payment versus the portion that you still owe the lender.

At the beginning of your mortgage, more of your payments go toward paying off the interest and less toward paying off the principal. But the longer you stay in your home and the more mortgage payments you make, the more principal you pay off and the more equity you accumulate.

Most mortgages also offer you the option of making additional monthly or annual payments to reduce your principal faster. Some prepayment privileges, for instance, enable you to pay up to 20% of the principal per calendar year. This will also help reduce your amortization period (the length of your mortgage), which, in turn, saves you money.

There is also a tax advantage. If your home is your principal residence, any profit you make when you sell it is tax-free. A home can appreciate – or increase in value – as time passes, building more equity. As you build up equity, it’s usually easier to upgrade to a more expensive home in the future thanks to the profit you’ll make when selling your current home.

As an owner, you can also decorate and improve your home any way you like. Ownership tends to give you a sense of pride and can offer you and your family stronger ties to the community.

If you do decide that home ownership is right for you, it’s important to choose a home you can afford. If you can’t afford to buy your dream home, purchasing a more modest home can be a great place to start building equity that one day may allow you to buy the home of your dreams.

Since we’re currently in a buyer’s real estate market and interest rates have been dropping, now may be an ideal time to enter into home ownership for the first time.



Some disadvantages of buying a home

Since it’s easy to get caught up in the excitement of buying a home, it’s important to remember that home ownership has some additional responsibilities as well.

For one thing, a home can be expensive. Chances are, your monthly payments will be more than what you are currently paying in rent when you factor in such things as your mortgage, property taxes, repairs and general maintenance.Owning a home ties up some of your cash flow and is likely to reduce your flexibility to move to a new location or change jobs.

While your home might increase in value as time goes by, don’t expect to get a big return quickly. There are no guarantees that your home will increase in value, particularly during the first few years. In the beginning, you could actually lose money if you sell because your home may not have appreciated enough to cover the real estate fees, and moving, renovation and other selling costs.Real estate is, however, usually considered a good investment over the long term.

When making the decision about whether to buy or rent, it’s important to carefully choose a home you can afford, and then weigh the pros and cons. Millions of people enjoy the rewards of home ownership but, ultimately, it’s a personal decision based on your own priorities.

If you’re thinking of buying your first home, Dominion Lending Centres mortgage professionals can answer all of your mortgage-related questions.

Alternative Financing for Funding Your Mortgage

Mortgage Tips Trish Pigott 26 Aug

If you do not qualify for traditional financing all is not lost, since you may be eligible for an alternative – or private – funding.

Mortgage professionals often have access to private investors who are willing to lend money to BFS individuals looking to obtain mortgages. Although you will pay a higher interest rate – on average about 12% – this route may enable you to acquire funds to purchase a home.

It’s also important to note that there are added fees involved with private funding because the deals involve a higher degree of risk. The combined lender/brokerage fee will depend on the specific deal and the risk it poses, but the figure will be disclosed upfront so you know exactly what you’ll be expected to pay for these services.

Another key point to consider is that private financing is equity-based, meaning that the lender’s decision will be based on a specific piece of real estate. Private lenders want to know that the property is marketable and that they will be able to easily sell it should the mortgage go into foreclosure.

What exactly is alternative financing? Alternative finance refers to forms of finance that are outside the institutional finance system of banks and capital markets. ‘Fintech’ is the ecosystem within alternative finance made up of companies, technology, and processes that aim to improve traditional methods of finance in categories such as:

  • Payments and invoicing
  • Consumer lending and credit
  • Small business lending and credit
  • International money transfers
  • Equity financing and crowdfunding
  • Insurance
  • Consumer banking
  • Wealth management
  • Savings and investments
  • Capital markets
  • Risk management
  • Regulation management
  • Cryptocurrency and blockchain

Fixed Rate or Variable Rate

Mortgage Tips Trish Pigott 20 Aug

The decision to choose a fixed or variable rate is not always an easy one. It should depend on your tolerance for risk as well as your ability to withstand increases in mortgage payments. You can sometimes expect a financial reward for going with the variable rate, although the precise magnitude will ebb and flow depending on the economic environment.

Fixed-rate mortgages often appeal to clients who want stability in their payments, manage a tight monthly budget, or are generally more conservative. For example, young couples with large mortgages relative to their income might be better off opting for the peace of mind that a fixed-rate brings.

A variable rate mortgage often allows the borrower to take advantage of lower rates — the interest rate is calculated on an ongoing basis at a lenders’ prime rate minus a set percentage. For example, if the prime mortgage rate is 5.5 percent, the holder of a prime minus 0.5 percent mortgage would pay a 5.00 percent variable interest rate.

As a consumer, the best option is to have a candid discussion with your mortgage professional to ensure you have a full understanding of the risks and rewards of each type of mortgage.


First-Time Home Buying Tips

Mortgage Tips Trish Pigott 19 Aug

A successful home buying experience is all about getting the details right from start to finish. These tips for first-time homebuyers will help you navigate the process, save money and close the deal. We organized them into four categories:

  • Preparing to buy tips.

  • Mortgage selection tips.

  • Home shopping tips.

  • Home purchasing tips.


Preparing to buy tips

The main costs to consider when saving for a home are your down payment, closing costs, and your moving expenses. You will want to sit down and look at how much you can spend on a house before starting to shop. Our My Mortgage Toolbox is a great app to use to calculate your home affordability. The app can help with setting a price range based on your income, debt, down payment, and credit score. Lastly, check your credit score! Your credit score will determine whether you qualify for a mortgage and affect the interest rate that the lenders will offer. Start by getting a copy of your credit report. Be sure you are paying your bills on time, and keep your credit card balances low.

Mortgage selection tips

Your mortgage broker will be able to go over the mortgage program options that will work best for you. You will discuss the mortgage rates and fees comparisons from the different lenders. Your mortgage broker will talk with you about getting pre-approved and the advantages that can bring when it comes time to place an offer on a home.

Home shopping tips

When you start to shop for your home, choose a real estate agent carefully. A good agent will look in the market for homes that meet your needs and guide you through the negotiation and closing process. Pick the right type of house and neighborhood to fit your lifestyle and budget. Would you like a fixer-upper home or a home that is more renovated and ready to move in. Think about your long-term needs and whether a starter home or forever home will meet them best. If you plan to start or expand your family, it may make sense to buy a home with extra room to grow.

Home purchasing tips

When you find a home you would like to purchase, paying for a home inspection will add to making an informed decision about buying the property. The home inspector will do a thorough assessment of the structure and mechanical systems. Negotiate with the seller; you may be able to save money by asking the seller to pay for repairs in advance or lower the price to cover the cost of repairs that will need to be made. The final tip is to purchase homeowners insurance before closing the deal. Home insurance covers the cost to repair or replace your home and belongings if they’re damaged by an incident covered in the policy. It also provides liability insurance if you’re held responsible for an injury or accident.

Borrowing Against Home Equity

Mortgage Tips Trish Pigott 18 Aug

What is equity and how does it work? Home equity is the difference between the value of your home and how much you owe on your mortgage. Home equity is the difference between the value of your home and how much you owe on your mortgage. For example, if your home is worth $250,000 and you owe $150,000 on your mortgage, you have $100,000 in home equity.

Your home equity goes up in two ways:

  • As you pay down your mortgage
  • If the value of your home increases

You may be able to borrow money secured against your home equity. Interest rates on loans secured against home equity can be much lower than other types of loans. Financing for equity will look different from a mortgage loan. Your mortgage broker will be able to go over with you which financing options are available for home equity loans. You must go through an approval process before you can borrow against your home equity. If you’re approved, your lender may deposit the full amount you borrow in your bank account at once.

Other financing options to look at in refinancing your home would be a refinancing loan, a second mortgage, a HELOC, or a loan or line of secured credit within your home. Something to keep in mind with refinancing, you may find that the interest may be different than the part that is on your original mortgage. You may also find that you have to pay a new mortgage loan insurance premium.

When you and your mortgage broker go over the option of a second mortgage, some points that you will find about this option are that you are able to borrow up to 80% of the appraised value of your home, minus the balance on your mortgage. The loan is secured against your home equity. While you pay off your second mortgage, you also need to continue to pay off your first mortgage.

A HELOC is very similar to a regular line of credit. You have the ability to borrow money when needed, up to the credit limit amount. You are able to take the money out of the HELOC, when you pay it back you are able to borrow again. This is a secured line of credit against your home. The interest rates are variable, they will change as the market interest rates go up or down.

One last option to look at when borrowing against your home is to borrow on amounts that you prepaid. If you have previously made lump sums on your mortgage, your lender may allow you to re-borrow that money. You can borrow the total amount of all the prepayments you have made. Any money you re-borrow will be added to the total of your mortgage. With this option, you will pay either a blended interest rate or the same interest rate as your mortgage on the amount you borrow. A blended interest rate combines your current interest and the rate currently available for a new term.

We have more information in our Mortgages drop down menu

Making Your Finances a Regular Priority

Mortgage Tips Trish Pigott 16 Aug

Just like regular housekeeping, looking at your finances is something that needs to be regularly done if you want your finances to be in order and shining. Schedule some time once a week to look over budgets and review your goals to see where you are with what you have in the bank – and what you’re trying to achieve.

Overspending can be prevented with a regular review and clear out of your finances. Can you reduce paying for apps or streaming services that you just don’t use anymore? Do you know how much you spend each week eating out or over buying groceries for your home that end up in the waste? Go through all aspects of your financial life and assess whether it’s working and if improvements could be made.

Budgeting gives you control when it comes to finances and is an essential part of financial housekeeping. Make sure you know what’s coming in every month – and that you’ve estimated your outgoings so that there are no surprises.

Regularly looking at your budget will keep you on track for your financial goals and have you feeling more secure in your day to day purchases. When you have an idea in mind of your goals, talking with a Mortgage Broker will help you to bring you close to knowing what small details you need to look at IE looking at what is going on with your credit, and other steps needed to achieve the end financial goal.



Five Home Care and Maintenance Tips

General Trish Pigott 13 Aug

Home care is something we often neglect. Between our daily and weekly to do lists, home care is something that often falls by the wayside. But it makes a big difference. Your home and property benefit from regular care checkups.

The good news is tackling home maintenance in 10-minute increments is the best way to get it done. We have listed below 5 ways you can keep your home feeling cared for below.

Replace your furnace filters seasonally. This is a good home care tip to do every three months at most. Doing this will increase your furnace efficiency by 15 percent!

Clean the air conditioner grill and register. The same as the furnace filter receiving routine care, this care time will improve efficiency.

Conduct a garage door safety check. Put the door into manual mode and lift it: it should glide smoothly and stay open on its own three feet from the ground. If not, have a pro counterbalance it. Put a medium-sized object on the ground (a small cardboard box or lightweight plastic laundry hamper, for example) and close the door. It should pop up as soon as it meets the obstacle. If not, call a professional to have your door checked and fixed.

Check your water heater for signs of leakage or rust. If the seams between the hot water tank and its connecting pipes appear to be rusty or corroded, it is time to call a professional to see if the tank can be repaired or if it needs to be replaced.

Clean your kitchen exhaust hood. This appliance is designed to filter airborne grease, combustion products, fumes, and smoke, so it’s important to take the time to clean it once in a while.

Mortgage Insurance Protection

Mortgage Tips Trish Pigott 11 Aug

When purchasing your home, it will be a time filled with excitement. A product to talk about with your Mortgage Broker is mortgage protection insurance. Mortgage protection insurance can pay some or all of your outstanding mortgage balance if you lose your job, become disabled, or pass away, so you don’t leave a large debt for your family. Below are some examples of benefits from the Manulife One Protection Place.


  • Long-term protection
  • Reduce your mortgage debt
  • High Maximum coverage

The maximum insurance amount of $500,000 will cover:

  • The average month-end balance of your Manulife One account over the last 12 months or the outstanding balance on the day you pass away – whichever is less.
  • Interest accumulated on the debt balance between the date of death and the date the insurance payment is made.
  • Fees and expenses to discharge your mortgage up to 5% of the total insurance payout.


The smaller your outstanding balance, the lower your monthly premium. Premiums will vary. They’re calculated every month based on the outstanding month-end balance of your Manulife One account and the age when you were approved for the coverage.

If you would like to know more details about Mortgage Protection Insurance we are always available to answer any questions.

Number of Canadians Owning Two Homes is Growing

General Trish Pigott 9 Aug

A recent survey put out by Royal LePage showed that a growing number of Canadian’s, particularly in the countries largest urban centers own more than one property. More than 10% of Canadians own at least two homes in areas of the Greater Montreal Area, the Greater Toronto Area, and Greater Vancouver.

The majority of the second property owners in Vancouver said that they are using the properties as rental income, even on a partial basis.

“Entrepreneurial landlords supply housing to the 30% of Canadians who rent, be they new immigrants, students, young people entering the labor force, or those who cannot, or choose not to, own their home,” said Phil Soper, president and CEO of Royal LePage.

Young buyers look to capitalize on the real estate market by investing in a property that will appreciate over time. Many people look to buy smaller condos or homes in area’s close to universities to capitalize where the rental market is very active among Students. Another trend within this increase showed parents who will purchase a property with multiple units for their children while they are studying and then use the property for rentals to other students.

Have you thought about owning a second property? We would be happy to discuss your property and financial goals anytime with you.


Five Basic Steps to Home Buying

Mortgage Tips Trish Pigott 6 Aug

Your home is going to be the place that you create memories with your family and friends. Buying a home will build a financial foundation for your future. This can be an exciting time as well as a confusing time. We can help make the process feel much simpler as well as be a resource to help you make informed decisions at each stage of the buying process.

Step One: Is Home Ownership Right For You?

Buying a home is one of the biggest decisions you will make. A few questions to ask yourself are: What do you want in a home? What does your current financial situation look like? What are your financial and lifestyle needs?

Step Two: Are You Financially Ready to Own a Home?

Before you start looking for a home, figuring out how much you can afford is key! Your mortgage payment will be your largest expense however, there will be other costs you should be aware of. You won’t want to be caught off guard by any surprises. The more you are prepared financially as well as the more you know what that looks like, the smoother the process will be when you meet with your mortgage broker.

Step Three: Financing Your Home

The time has come to meet with your mortgage broker and talk about the different financing options and look and see if you are prepared to buy a home. The mortgage broker will discuss terms and interest rates and will go over what needs to be done to ensure you are approved for your mortgage, once you find your home.

Step Four: Finding the Right Home

With a clear picture of your finances and mortgage options, now is time to start thinking about the type of home you would like to buy. Look for a home that will meet your needs not just for now, but also 5 or 10 years into the future.

Step Five: Making an Offer and Closing the Deal

The final step! You have a mortgage that works for you and found a dream home that fits your budget. Now it’s time to put in an offer and close the deal!

Final thoughts with making your mortgage work for you, and common terms that your mortgage broker will go over with you are:

  • Amortization period
  • Payment schedule
  • Interest rate type
  • Mortgage term
  • ”Open” or ”Closed” mortgage

For more information on the home buying and mortgage approval process please reach out to our team! We look forward to talking with you!