NormanLane Real Estate | 709-221-SOLD | 323 Freshwater Road St. John's NL A1B 1C3

Category Archives: refinancing

Interest rates are on the rise… (thanks Donald Trump)

Over the past few days, I've received many inquiries in my inbox with questions from clients asking what they should do about the real threat of interest rates rising that they are hearing in the media. This question has many different answers, and all can be relevant (or not) to your specific situation. Some people…
Read more

BREAKING NEWS: Drastic Mortgage Rule changes affect us all!

On Monday October 4th, Canada's Federal Finance Minister Bill Morneau blind sided the Real Estate and Mortgage Industry with new legislation that is going to have a fairly sizable impact on the National Real Estate Market. As of Oct 17th, 2016 all bets are off...   The big announcement will undeniably affect the most vulnerable,…
Read more

Borrow up to $30,000 with one simple click!

owwa-loan

 

Finally, after many years of requesting it from our long term partners Verico and Grouplend, the NormanLane team now has access to an unsecured lending product with loans up to $30,000 approved instantly with funds landing in your bank account within 24 hours of your submitted application!

Whether you’re consolidating high interest credit card debt, doing a home renovation, or making a major purchase, getting a Verico/Grouplend loan via NormanLaneLending.ca  is surprisingly simple.

 

How does it work?

 

1. You fill out a quick 1-minute application @ NormanLaneLending.ca (which won’t affect your credit score to get your personalized quote.)

2. Once you choose to move forward with your loan, send us a few documents to verify your identity and income.

3. The money is deposited into your bank account the next business day!

 

  • We hate hidden fees so we made sure there are none!  Nor will there be any origination fees OR any early repayment penalties.
  • We also don't believe in teaser rates! Your rate and payment will never change over the term of your loan.
  • The application only takes 1 minute and can be done from your phone, tablet or computer.
  • With rates as low as 6.3%APR, our borrowers can save 30-70% compared to carrying balances on their credit cards.

This is BIG news for our team in being able to help our clients in their financial and home ownership goals!

Visit our page at normanlanelending.ca for complete details or email mark@normanlane.ca for a step by step walk through!

 

 

 

Choosing a mortgage based on rate is like buying a car based on price…

 

 

Reprinted with permission from (and written by) Darryll Esch of Clear Home Mortgage Solutions in Winnipeg, Manitoba

 

 

Chances are, if you have looked at getting a mortgage, you have been shopping around for the best mortgage rate. After all, you are after the best deal, and what is the best deal if not the best rate? A fraction of a percentage point up or down could mean of several thousands of dollars saved or lost over 5-10 years.

So if saving money is your goal, rate is clearly the most impactful factor, right?

Wrong. This is what the banks want you to think. And because it is the easiest factor to compare between banks, most people accept this as a close approximation of truth.

But a mortgage consists of many different features other than rate that can actually cause a great deal of potential savings or losses. In fact, this is how banks make their money off of mortgage agreements. They lure hopeful customers in with rate, using a standardized mortgage agreement that is not customized to individual needs, and their trusting customers literally hand them their money based on what the fine print says — often without being aware of it.

A mortgage can be customized to individual needs and goals to fit your particular financial situation. Just like … say, a car.

Imagine getting a car and focusing only on the price. Seems pretty ridiculous, right? Well, let’s just play with it to see where the argument gets us. One could argue that the point of owning a car is to have the cheapest means of getting from point A to point B — so any car that allows you to do just that in the cheapest way possible is the best car for you (and the best car for anyone, period).

So naturally, price is probably the most important determining factor, right?

Immediately we run into a problem with this argument. While price is a consideration, fuel and repair costs over the lifetime of a car will cost you far more than the actual up-front purchase price. So suddenly the choice becomes very different depending on how far and how frequently you plan to travel. It even depends on what type of driver you are — aggressive, fast accelerating, or calm and gentle.

Someone who travels frequently to remote cities and who is an aggressive driver will be far better off investing in an expensive but energy-efficient car, than a large city dweller who uses the car occasionally to visit nearby friends.

Then you have other factors such as whether you will share the car (two small cars or a large one?), whether you have a large family or not (what type of car?) and whether you have children who will soon grow up and want their own cars (safety and security features).

You even have your personal financial factors to consider — do you have ability to make a large down payment in cash, what is your income, what will your income be in the future, how much do you need to save, are you planning to sell the car in the future to upgrade to a more expensive one?

And all this without even considering personal comfort and enjoyment features.

Which brings us to mortgages. Just as choosing a car comes with a variety of features that may make one particular car suitable for one person but not for another, so does a mortgage. It’s not all about the rate — just as a car isn’t all about the price. Features like period, fixed or variable, optimal amount, penalty clauses, and fine prints around things like how your mortgage is actually managed and by whom (yes, it matters — a lot more than you think).

The problem is, a car is concrete, firm, easy to test-drive, easy to get your head around. Fine print around mortgage terms isn’t. Mortgage rate is. This is why most people focus blindly at the rate, and forget the other crucial factors surrounding a mortgage. It is very difficult to make a fair comparison between the fine print of multiple banks, and make an informed decision around which one is best for you, in your current particular situation, with all the potential future scenarios covered.

The take-away from this article is as follows: Please, don’t determine which mortgage is best for you based on the rate. There are multitudes of factors and considerations around your particular goals, financial situation, and future opportunities to make. Educate yourself, read the fine print, understand it, and ask the bankers the tough questions that forces them to show you their cards. Get in touch with a good broker, someone who understands the foul secrets the banks use to lure you into the interest rate trap, and then determine for yourself if you want to dig into the fine details to make the comparisons, or if you want to hire a good mortgage broker to do it for you.

Update: Bank of Canada lowers rates, but not the banks!

  The big news last week was the Bank of Canada`s Governor announcement that he would be lowering the overnight lending rate by .25%. This generally translates into a reduction in the prime rate as well.  However, there tends to be a slow reaction to this news by the big banks. Now, I`d chaulk this…
Read more