Homeownership bestows a number of privileges. Not only are you free to make any changes or repairs you want, the time and money you put into making your home more comfortable are concrete investments that will pay off when it comes time to sell.
But what you may not know is that your house can also provide you with considerable financial leverage in the meantime — even if you haven’t yet finished paying off the mortgage.
Your home is an asset, and in the process of paying off your mortgage, you come to own more and more of this asset outright. And given Ontario’s white-hot housing market, your home has likely appreciated in value significantly due to external forces. This means that you have built up a store of equity that can be used for a variety of different purposes, from paying down debt to funding renovations and repairs.
In this piece, we’ll discuss how a second mortgage can be used to unlock this equity and help you achieve your full financial potential.
What is a Second Mortgage?
As the name suggests, a second mortgage is a loan taken out in addition to your primary mortgage against the equity you’ve built up in your home. Unlike refinancing, which replaces your existing mortgage with a new one, a second mortgage is an additional debt (your initial mortgage will retain precedence in the event of a foreclosure).
Getting a second mortgage in Ontario is relatively easy, and can be done through a residential mortgage broker. Mortgage brokers work on your behalf to find a range of possible lenders who can offer good second mortgage rates and provide terms that work for you. In some cases, it is possible to get the money within a matter of a few business days.
How Should a Second Mortgage Be Used?
A second mortgage can be a great way to free up funds, but these funds are still a loan, and as such should be treated as investment capital rather than spending money. A second mortgage should be used to put yourself on a better financial footing, not pay for a holiday in Rome.
One of the most common uses for a second mortgage is to consolidate debt — especially high-interest unsecured debt from credit cards or auto loans. Replacing a number of smaller obligations with a single loan at a lower interest rate is a practical way for Canadians juggling a large number of payments to chart a realistic course toward debt freedom.
Second mortgages are also used in situations where the borrower has a large one-time expense they can’t cover with their savings: replacing a roof, for example, or car repairs. A second mortgage is a fast, low-interest way of quickly generating the necessary funds.
In addition to being a place to live, a home is a major asset, and you don’t need to sell it off in order to benefit from the financial leverage it provides.
If you need extra funds for debt consolidation or home repairs this year, get in touch with a mortgage broker who can connect you with some of the second mortgage lenders Ontario has to offer for an easy, financially-prudent solution.
Canadian home sales, prices surge to new record in March
OTTAWA (Reuters) – Canadian home sales rose 5.2% in March from February, setting a new all-time record amid strong demand in markets across the country, the Canadian Real Estate Association said on Thursday.
The industry group said actual sales, not seasonally adjusted, rose 76.2% from a year earlier, while the group’s Home Price Index was up 20.1% from last March and up 3.1% from February.
The actual national average selling price hit a new record at C$716,828 ($572,821) in March, up 31.6% from a year earlier and rising 5.7% from February.
($1 = 1.2514 Canadian dollars)
(Reporting by Julie Gordon in Ottawa)
Hot real estate market sparks warnings to potential buyers as complaints to regulator double
As home sales in the province continue on a dizzying trajectory, the province’s real estate watchdog and regulator are warning buyers to be wary of what they may be getting into.
The Real Estate Council of B.C. (RECBC) and the Office of the Superintendent of Real Estate said that in the first three months of 2021, they have seen an increase in inquiries and complaints.
Calls to the regulator were up 42 per cent over the previous year, while complaints, such as how offers were made and accepted, were double the number received in the same period in 2020.
“Buying a home is one of life’s biggest financial decisions. There are potential risks at the best of times, but with the added pressure and stress of the current market conditions, those risks are amplified,” Micheal Noseworthy, superintendent of real estate, said in a statement.
Planning on buying or selling a home this spring? With increased market activiy, its important to understand the risks, and we are here to help. Here are some tips to help you find the most up-to-date information before you make a decision: <a href=”https://t.co/7D8d5Of5XZ”>https://t.co/7D8d5Of5XZ</a>
The Real Estate Board of Greater Vancouver says sales in the region have continued at a record-setting pace.
Residential home sales covered by the board totalled 5,708 in March 2021, up 126.1 per cent from March 2020, when the COVID-19 pandemic hit, and up 53.2 per cent from February of this year.
Rural and suburban areas have experienced the biggest spikes.
For the past two weeks, Jay Park has been in the middle of the buying frenzy.
He and his partner are trying to upgrade from their one-bedroom apartment to a two-bedroom condo or townhouse in Vancouver.
“I wish we had done this a month or two ago,” he said.
Park put an offer on a $1-million condo, $4,000 above asking price.
“To entice the [seller], we put in a subject-free offer, but it wasn’t successful,” he said. “They accepted $110,000 over asking price that was also subject-free.”
The hot market has led to bidding wars. Some would-be buyers have even lined up outside for days to try to get a jump on a property.
Erin Seeley, the CEO of the council, is warning buyers to do their research and be aware of risks before making an offer.
“It’s really important that buyers have engaged with their lender before they’re making offers so they know how to stay within a reasonable budget,” she said.
Seeley said some of the complaints the council has heard from buyers is that they weren’t aware the seller has a right to take an early offer.
“And the seller was really in the driver’s seat about setting the pricing,” she said.
Aaron Jasper, a Vancouver realtor, advises clients to avoid cash offers and to include finance clauses even if it may mean they lose a deal.
“There’s a lot of frustration among buyers, feeling pressure to take some risk,” he said.
“You’re better to be delayed perhaps a year getting into the market as opposed to being completely financially ruined.”
Jasper also says realtors are limited in the advice they can give to clients on legal matters, home inspections, potential deficiencies with homes, and financing.
‘Caught up in the craziness’
Other tips from the council include seeking professional advice before making a subject-free offer or proceeding without a home inspection, and speaking to a professional to determine how market conditions may be affecting prices.
Meantime, people like Jay Park say they are still keen to buy. Park has more viewings scheduled and is optimistic.
“It’s a very exciting time for us, but I also don’t want to get caught up in the craziness and make a purchase that’s above our means.”
Source: – CBC.ca
Black Press Media introduces one of Western Canada’s best real estate platforms helping home buyers Find. Love. Live. that new home
Need an agent who knows the community?
Or, is it time to look for a new place to live, but you don’t know what’s on the market?
Whatever the real estate need is for residents in the communities of British Columbia, Yukon & Alberta, there’s a new way to do that one-stop shopping – by visiting Today’s Home.
The slogan for the site is “Find. Love. Live.”
“We want people to find their dream home, love it, and live in it,” said group publisher Lisa Farquharson.
Building on the success of Black Press Media’s niche digital platforms – Today’s Home brings the same wealth of knowledge and local expertise to the search for a home, be it buying, selling, or even just daydreaming about what changes you can make in the future.
Search hundreds of listings that local real estate agents have available.
The listings cover properties around the region, from a one-bedroom, one-bath condo for $339,900 to million-dollar acreages throughout the province of BC, Yukon, Central Alberta and beyond.
Click on a listing, and see not only the realtor handling the property sale, but links to his or her other listings and social media feeds. With the click of a mouse, take a virtual tour of the property, find the property’s walking score, and learn about nearby amenities.
There are links available to schedule a showing, or send the agent a comment or question.
Want to share a listing? When you click on the share button, you’ll actually send an attractive digital flyer of the prospective property, not just a link.
There’s even a button to help determine how much you have to spend, courtesy of the convenient mortgage calculator.
Plus, scroll down the page on Today’s Home and find a list of expert local real estate professionals who can answer questions or help with that home sale, Farquharson explained.
Today’s Home offers the advantage of the massive reach that Black Press Media has built throughout Western Canada with its network of community newspapers and online products. That allows the public to tailor real estate searches based on location, price, and other key factors while allowing real estate professionals to gain unprecedented audience reach with their listings.
Today’s Home will dovetail into the media company’s existing print real estate publications.
“Black Press Media has real estate solutions in print and now we can add in the digital component,” Farquharson said.
Watch for expansion of the Today’s Home platform in the near future, she added. That will come as Black Press Media adds a new component – the development community. Developers will be able to reach a huge audience when their projects are ready for presentation.
For information on Today’s Home, contact group publisher Lisa Farquharson at 604-994-1020 or via email.
Happy house hunting!
Source: – Aldergrove Star
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