25 Nov

Why Do We Ask for So Many Documents When Pre-Approving Clients

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Posted by: Peter Paley

We put in the work upfront to ensure no surprises when you write an offer on your dream home. Our thorough pre-approval process focuses on income, credit, down payment, existing properties, expenses, and other critical items to set you up for success.

Income Documentation

  • Employed Individuals: Letter of Employment, pay stubs, T4s, and bank statements to confirm deposits.
  • Self-Employed Individuals: T1 Generals, NOAs, SOAs, and, if incorporated, T2 Generals and APFS.
  • Pensioners: T4s, NOAs, pension documents, and bank statements to verify deposits.
  • Parents: CCB statements, children’s DOB information, and bank statements to confirm deposits.

Down Payment Verification

We review up to 90 days of bank statements (30 days for some lenders with 20% down payments). Documents include investment statements, RRSPs, TFSAs, FHSAs, property sale documents, or gift confirmations. Deposits over $3,000 must be sourced.

Credit Review

We pull your credit report to identify and correct inconsistencies, ensuring there are no surprises.

While reviewing all this documentation is time-consuming, it allows us to provide clients and REALTOR® partners with solid, reliable pre-approvals. Unlike others, we prioritize accuracy to avoid heartbreaking situations where financial institutions fail to honor their pre-approvals.

Not all pre-approvals are created equal. Choose the team that works hard upfront to treat your money like their own.

23 Nov

Canada’s Banking Regulator OSFI Just Made a Positive Change to Mortgage Renewal Rules

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Posted by: Peter Paley

This week, OSFI (Canada’s banking regulator) announced an important and sensible adjustment to the mortgage renewal process:

No More Stress Test at Renewal.

Before anyone jumps to conclusions like, “Isn’t that risky?”, let’s break down how mortgage renewals work in Canada:

  • Most Canadian residential mortgages are structured as short-term agreements. Over 95% of all mortgages fall within 1-to-5-year terms.
  • Because of these short terms, renewing your mortgage with your current lender is usually automatic. There’s no re-underwriting involved.
  • When it’s time to renew, borrowers typically receive a renewal letter from their lender offering rates for different term options. The borrower simply picks one—no additional financial scrutiny is required.
  • In fact, the current lender doesn’t even check if the borrower is still employed.

Now, if borrowers want to shop around for a better rate, that’s a different story. They have to go through the hassle of providing updated proof of income. Until now, they also had to pass a stress test—a requirement that felt unnecessary and inconsistent, given the lack of income verification from the existing lender during renewal.

This is what has changed.

This change is a huge win for the 12%–15% of borrowers who previously couldn’t shop for better rates because of the Stress Test. Shopping around is critical, especially in today’s environment where almost every renewing borrower is facing higher rates. Now, borrowers have a real opportunity to seek out and secure the most competitive deal available to them.

Why was this necessary?

For five years, OSFI insisted it was dangerous not to Stress Test mortgage renewals—even though they were well aware that lenders didn’t verify income during the renewal process. This inconsistency made the Stress Test a roadblock for borrowers looking to improve their terms.

Interestingly, it wasn’t OSFI but the Department of Finance that pushed for this sensible policy change, finally addressing the gap.

Why did OSFI resist this for so long? That’s a question worth pondering. But for now, let’s celebrate the fact that a flawed policy has been corrected, making the mortgage renewal process fairer and more consumer-friendly.

In a market like today’s, where every percentage point matters, this change empowers borrowers to make better financial decisions and secure the best possible rates. We may be back on track to an era of good mortgage policy.

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6 Nov

Top 10 Mortgage & Financial Tips

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Posted by: Peter Paley

When clients ask us for advice, we always emphasize that while everyone’s situation is unique, smart financial habits benefit everyone. Here’s our top 10 tips for a stable, successful path to homeownership—and beyond:

1️⃣ Focus Beyond the Rate: A mortgage should work for your life goals, not just have the lowest rate.

2️⃣ Create a Household Budget: Stay on top of your finances with a realistic budget to live comfortably within your means.

3️⃣ Prioritize Savings: Don’t sacrifice your RRSP, TFSA, or other investments just to pay off your mortgage faster. Build a balanced financial future.

4️⃣ Get Proper Insurance: Life and credit protection insurance are essential safeguards. Secure what matters most.

5️⃣ Build Emergency Savings: Aim to keep at least six months of household expenses as a safety net for the unexpected.

6️⃣ Consider Investment Properties: Think about adding an investment property as part of your retirement plan—it’s a valuable asset for the future.

7️⃣ Live Within Your Means: Focus on what you need, and align spending with your long-term goals.

8️⃣ Grow Financial Knowledge: Books and audiobooks on personal finance are a powerful way to improve your financial skills.

9️⃣ Buy Secondhand When Possible: Save money (and skip sales tax!) by opting for gently used furniture, appliances, or yard tools.

🔟 Maintain Your Property: A well-kept home not only retains value but also saves on costly repairs down the road.

Smart financial habits make all the difference in achieving a secure, comfortable future. Ready to dive deeper? Connect with us for personalized mortgage and financial guidance!

👉 Download the DLC App to start your journey with expert support and resources!

#MortgageTips #FinancialFreedom #HomeBuyingAdvice #DLCBroker #SmartLiving #InvestInYourFuture

2 Nov

Thinking Beyond the Mortgage: Financial Planning for Homeowners

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Posted by: Peter Paley

Thinking Beyond the Mortgage: Financial Planning for Homeowners

When securing a mortgage, it’s easy to focus on rates and payments, but the true cost of homeownership goes beyond just the monthly mortgage. A solid financial plan can help set you up for success. Here are some critical questions to ask:

  1. Have You Considered All the Costs? Do you fully understand the costs associated with owning a home? Beyond the mortgage, there are utility bills, home insurance, property taxes, maintenance, and more. Every dollar counts, and planning for these expenses can prevent surprises.
  2. Have You Done a Household Budget? A detailed budget can give you clarity on your monthly cash flow. Knowing what you spend versus what you bring in ensures you’re living within your means and can make it easier to manage unexpected costs.
  3. What’s Your 3, 5, and 10-Year Plan? Life changes, but having goals can help guide your financial decisions. Whether you plan to move, upgrade, or stay put, knowing where you want to be in a few years can help you make the right financial choices today.
  4. Are You Prioritizing Savings and Investments? Building equity in a home is great, but what about your other financial goals? Will you have enough left over each month to contribute to savings, your RRSP, or a TFSA? Planning for the future should be a part of your strategy today.
  5. Are You Living Within Your Means? Maintaining a comfortable lifestyle without stretching finances thin is the key to long-term success. Understanding your limits and sticking to them can keep financial stress at bay.

Homeownership is a major step in your financial journey. Make sure you’re prepared for not only today’s costs but also tomorrow’s possibilities. If you’re unsure about any of these points, let’s connect. I’d be happy to discuss how we can help build a mortgage plan that aligns with your long-term financial goals.

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