How to Deal With Mortgage Payment Difficulties

When unforeseen financial circumstances impact your ability to make regular mortgage payments, it’s important for you to take quick action. With early intervention, cooperation, and a well-executed plan, you can work together with your mortgage professional to find a solution to your financial difficulties.

If you or your spouse has lost employment and no longer make as much money, and you see meeting your mortgage payment obligations is going to be problematic, the first step is to take a deep breath. There are literally millions of people that face the same problem. Fortunately, there are ways to avoid default and keep your home, so read on for more information on how to avoid a mortgage default.

1- Get moving on a solution. Your first option is to find a way to make up the back payments and continue fighting to make your payment on time every month. Although not an attractive options, it is an option.

Explore options to decrease expenses and increase income, such as an additional job, selling possessions, and look to community resources for help. You may have to temporarily cut back on things like dining out, internet and cable.

If you have a basement or spare room you may consider renting it out. The extra income could be up to 50% of your mortgage payment.

2- Work with your lender. Contact your mortgage lender. Banks do not want to foreclosure on properties. The process is long and costly, and in the end, mortgage lenders lose money. Instead, they would rather work alongside borrowers that are slightly behind on payments, and come up with a practical solution.
Consider extending your mortgage term to reduce your monthly payments. The downside is that you will end up paying more in the long term. However, if it means you are able to continue meeting the minimum mortgage payments, it is worth doing.
Set up a repayment plan. If you are unable to pay your mortgage payment for one or more months, the lender may agree to a repayment plan. The mortgage lender adds additional money to each subsequent mortgage payment until the loan is up-to-date.

Your lender may also suggest an Interest Only Mortgage. This will also reduce your monthly mortgage payments, often quite substantially. However, again the disadvantage is that, in the long term, you will need to find an alternative investment plan to pay off your mortgage capital—might be good short term option.

3. Refinance your mortgage. 
This is perhaps the easiest and most effective method. If you happen to be on your bank’s existing standard rate, the chances are you will be able to find a much better deal.

4. Talk to a Financial Advisor. 
If the situation is becoming overwhelming and you are really in danger of defaulting, you may need to consider speaking to a financial consultant or accountant. This will arm you with expertise and resources with which to approach planning your financial future and make the most of your current circumstances.

5. Resell – Downsize. 
This option is probably the most drastic and only to be undertaken when the others have failed. If you are able to sell your house, you can temporarily rent somewhere cheaper or buy a cheaper house in a different location. The money saved can be used to pay off your mortgage.

This option is not easy, due to the costs involved in moving, but it might be worth doing in the long term.

If you can see that things are going to get bad in relation to meeting your mortgage payment obligations, take a deep breath and take action now—it will help in the long run.

Contact me for a Free Home Value Report or for answers to any of your real estate questions at www.kimlouie.net!

Why Mould Detection is Important

Buying a home is likely to be one of the most important purchases you will make in your entire life, so it is only makes sense to take every possible step to limit the amount of risk you are exposing yourself to. For an increasing number of home buyers, calling for a professional mold inspection is a prudent way to verify a prospective home's quality before making a buying commitment.

Why mold is a threat
A serious mold infestation in a house has a negative impact on the home's indoor air quality. Although there are mold spores present to some extent in almost all of the air humans breathe, even a relatively minor increase in the density of airborne mold can cause health issues. Mold can cause a host of different respiratory problems, particularly for very young and very old residents and more serious and even fatal consequences are possible.

Mold has become increasingly important to Canadian homeowners in the last few decades because of the growing interest in energy efficiency in the home. More energy-efficient homes are generally more tightly sealed, leading to less air circulation. When combined with other factors that encourage residential mold growth, this low-circulation environment can become ideal for mold.

Beyond its health issues, mold is also a serious strike against a home's value. Buying a home with a pre-existing mold condition can lead you to significantly overpaying for the property. The remediation process required to get rid of the mold can be extremely expensive and even after cleaning the home thoroughly, it may still be difficult to sell.

How professional mold testers work
It is important to understand that there is a distinct difference between a mold inspector and an ordinary home inspector. Although a good inspector who tries to deliver a comprehensive report on the condition of a home before you buy it can spot the most obvious signs of a major mold infestation, rooting out hidden problems and diagnosing the exact nature of your mold issues calls for specialized expertise

Residential mold testing typically starts with airborne sampling throughout the home, concentrating especially on areas with high humidity like basements. Elevated mold levels in the air may indicate the presence of a hidden infestation that can't be seen. In cases like this, mold inspectors will perform an "invasive" inspection by opening wall cavities and other normally-inaccessible spaces.

When mold testing is vital
Mold testing can be extensive, especially if it involves demolition work and repairs. Many home buyers are hesitant to invest in comprehensive testing but going without it can be a serious risk. A serious mold infestation as confirmed by a qualified inspector can significantly impact the value of the home due to the health risks it poses. It can even be difficult to secure the financing you need to buy a home that has a confirmed mold problem.

It is always smart to invest in a professional mold inspection if you have any reason whatsoever to suspect a mold problem. Homes that have gone through significant water damage are prime candidates for inspection.

Fortunately, buyers and sellers can often work together to deal with mold issues in a manner that is safe and satisfactory for all concerned. Motivated sellers som
etimes offer to cover the costs of testing and any required remediation work, while in other cases, the costs can be divided between sellers and buyers in an equitable fashion.

While threatening levels of mold are still relatively rare in Canadian homes, you don't want to invest in a piece of property and then discover that it poses a health risk to your family. A mold inspection can be vital in giving a home a clean bill of health before you buy. This issue is too important to leave up to guesswork. Entrust the matter to a professional mold testing firm and know for certain what is lurking in a house you are thinking of purchasing.

Contact me today for a Free Home Value Report or for answers to all your real estate questions at www.kimlouie.net!

4 Ways to Build Equity in Your Home

One of the primary goals of home ownership should be the building of equity in your home. Equity is simply the difference between the current value of a property and the balance of all mortgage obligations.
For example, if you have a home that is valued at $375,000 (based on an appraisal or a Comparative Market Analysis) and a mortgage balance of $175,000, you have $200,000 ($375,000 -$175,000) equity in your home. As long as the market remains stable, this is like money in the bank. As your house value increases over time and mortgage payments you make reduces the level of your debt, your home equity increases.

Why Equity in a Home is Important?
Simply stated, the appreciation of equity in a home is one of the easiest and most successful paths to wealth that is available to you. To a large degree, it is almost painless—you make the mortgage payment that you would have to make anyhow and the balance is reduced. The value of the home, meanwhile, is rising. As a result, your nest egg should be growing. The quicker you find yourself at 100% equity—owning nothing on your home—the quicker the route to less financial stress and true wealth.

How to Build Additional Equity?
There are a number of ways to build additional equity in a home, some easier than others but all effective:

1) Higher initial down payment
The most obvious way to build additional equity is at the first opportunity—making a larger down payment at the time of purchase. This extra money is immediately "banked" in the home, making it much less tempting to spend.

2) Extra principal paymentsMaking extra payments of principal (or just adding money to your monthly payment designated to go to principal) has a double effect on your equity. First, every dollar you contribute reduces your debt by the same amount. Second, reduced debt means less interest paid, which means that each month more of your payment goes to principal and less goes to interest.
NOTE: Although most loans allow it, check with your lender to see if they accept extra payments of principal with no penalty.

3) Shorter mortgage termThe lower mortgage interest rates that we have seen recently means that for many buyers, they are able to either initially secure a mortgage with a shorter term or, if the are currently in a long term mortgage (such as 30 years) refinance and get a shorter term. Shorter mortgage terms mean that you will be paying down your principal much quicker and therefore gaining additional equity at a much faster rate.

4) Home improvementsWhen you improve the quality or size of your home, you also increase its value and thus your equity. Be aware, though, that although virtually all home improvement projects will bring some return, some are much more advantageous than others. For example, remodelling kitchens or bathrooms traditionally have brought a greater return than adding leisure amenities such as pools or whirlpools. To get the maximum equity enhancement, make certain that the kind of improvements you want to make will increase the home’s value appreciably.

Contact me today at www.kimlouie.net for a free Home Value Report or for more information on the current real estate market.

The Benefits of Using a Mortage Broker

Finding the right home may seem like the hard part of a real estate transaction, but in reality, getting the best financing can be much harder. This is partially because we have so many options nowadays for mortgage loans and so many places to find them. A mortgage broker or your local bank can often lay out your options clearly. They will be armed with what you want in terms of loan term, ideal rate, targeted monthly payments and the like. If you're smart, you will talk to them before you decide on purchasing your home so you really know your price range.

Using a mortgage broker is by far the best way to go about finding and arranging the very best mortgage to suit your specific needs. Trust in a specialist that knows how to package your application, what pitfalls to look out for, and how to protect your interests when dealing with the banks. Sure, you might get the same rate that a broker could get for you, but what you won’t get is all the facts about the mortgage that you have shopped for.

A mortgage broker/specialist helps you navigate around those banks with mortgages that appear to be the best deal out there, but fall short of your expectations. Brokered mortgages may not be as “flashy” on the exterior, but they will have all the “nuts and bolts” built into them to protect you from unforeseeable circumstances that often arise.

The benefits of using a professional mortgage broker include:

Reduce your stress and frustration. There are dozens of lenders from which to choose, so why not let an expert handle the application process for you? These days the forms and other data that are required for a loan application can be quite complicated, so it is wise to hand the entire process over to a professional.

Fewer complications. A seasoned mortgage professional will have years of experience, and that will help him or her navigate the tricky loan application waters that lie ahead. Let a broker’s know-how work to your benefit.

Help you get the best deal possible. Although you may be tempted to apply for the mortgage on your own, by hiring a professional you are assured of getting the best interest rate, the best payment plan, and the best deal in general.

Save you time. The most valuable of all commodities. A broker has the experience to make sure you get the best package for your individual needs and saves you valuable time.

Real personalization. Since the mortgage  broker works for you (not the lenders),  he/she offers you unbiased advice and help you select the mortgage that's absolutely right for you. You get the personal service you just cannot get from a bank.

Service at no cost. Not only will a broker obtain the best mortgage rate for you, broker services cost you nothing.

Contact me at www.kimlouie.net for a free Home Value Report or for more information about the current real estate market!

Knocking Down a Home to Rebuild?

Knocking down an old home to build another can prove a rewarding move. But, it requires careful consideration.

While renovating or moving home may be more traditional methods of solving a housing issue, knock down rebuild projects are becoming an increasingly popular housing strategy.

 Why knock down and rebuild?
There are a number of reasons to consider a knock down rebuild project. The chief reason for knocking down a home is because it’s beyond repair. As a general rule of thumb, the more work that needs to be done to a property, the more value a rebuild will offer. When it comes to especially old houses a rebuild is often the most cost-effective solution.

In established inner city metropolitan areas where land is increasingly in short supply, rebuilding is also sometimes the only way to get into a neighborhood or stay in one.

Many people also consider a knock down rebuild when a home is no longer suitable for their lifestyle but they don’t want to change location. Many of us have a strong affinity with our local community – be it the shops, schools or our neighbours – and a rebuilding project means this need not be disturbed.
And finally, people are often attracted to rebuilding because it can be much less stressful than renovating. We’ve all known friends who have spent months living without kitchens or bathrooms; a rebuild can be a much more hassle free solution.

Rebuilding and financing
The real financial benefit of a knockdown rebuild is the fact that there are no hidden costs.
Renovations are notoriously difficult to budget for, with unexpected hurdles likely to bring up countless additional expenses. Because of this finance can be difficult to arrange compared to a rebuild, which is straightforward.

Of course, building a new home doesn’t come cheap either, so it’s important to seek professional building advice as well as a range of quotes to determine what will be the most cost effective solution for you.

Important points to consider

• Don’t forget that you may be eligible for new home incentives from the government if you decide to rebuild rather than renovate.
• Be sure not to overcapitalise – a new home always involves unexpected expenses.
• If you’re knocking down your existing home you’re going to have to pay for rent during that time or find somewhere to live. So factor in possible extra costs.
• City approval for rebuilding can be difficult, time-consuming and expensive. But remember, carrying out any work without approval is illegal so don’t be tempted to try to slide under the radar.

Contact me at www.kimlouie.net for a free Home Value Report or to chat about the current real estate market.

3rd Consecutive Month of Home Sales Decline in Waterloo Region

KITCHENER-WATERLOO, ON (August 3, 2017) ––In July there was a total of 558 residential sales through the Multiple Listing System (MLS® System) of the Kitchener-Waterloo Association of REALTORS® (KWAR), a decline of 5.1 percent compared to the same month last year, but still slightly above the previous 5-year average for July (542).


July’s sales bring the year-to-date total to 4,387 residential units, an increase of 6.9 per cent compared to 2016.

"Home sales remain very strong, and while they have eased in comparison to July of last year, we have to remember that was a crazy busy time," says James Craig, President of KWAR. "What we’re seeing now is the more typical summer slowdown, but overall July was still an above average month."

Residential sales in July included 365 detached homes (on par with July 2016), and 113 condominium units (down 21.5 per cent) which includes any property regardless of style (i.e. semis, townhomes, apartment, detached etc.). Sales also included 38 semi-detached homes (down 20.8 per cent) and 36 freehold townhouses (up 44 per cent).

The average sales price of all residential sales increased 17.4 per cent to $455,217 compared to July 2016. Detached homes sold for an average price of $519,507 for an increase of 14.7 per cent, while the average sale price for an apartment style condominium was $277,866 for an increase of 13.9 per cent. Townhomes and semis sold for an average of $350,342 (up 22.8 per cent) and $352,721 (up 14.3 per cent) respectively.

REALTORS® listed 811 residential properties in K-W and area last month, a 22.9 per cent increase compared to July of 2016. While inventory levels continue to be low at just two months of inventory at the end of July – supply is up from where the measure has stubbornly stayed at just one month or less for the past 11 months. The number of months of inventory represents the time it would take to deplete current inventories at the current rate of sales. The long term average of months of inventory for KW and area is three and half months.

"The tight supply in the market continues to favour sellers; however the market seems to be shifting towards more balanced conditions," says Craig.

The average days on market in July was 22, compared to 26 days a year ago. On a month to month basis, it took six additional days on average from list to sale date in July compared to June.

Contact me at www.kimlouie.net for a free Home Value Report or to chat about the current market!