Fair Mortgage Solutions Inc. Blog

Cashflow is key

Cashflow is all important. Your total mortgage payment, property tax, heating, credit card bills, PLC and loans and leases are key to determining how you are doing financially. Reduction in income or increase in debts can put you out of whack and cause stress to increase. There are many ways to solve this problem but addressing it quickly is imperative. If you wait too long it could effect your options. Know your TDSR.

Posted: Friday, Jul 09, 2010

Preapprovals

It is a good bet to get preapproved before you go house hunting, it locks in a rate for a 120 day guarantee and lets you know what you can really afford. Call us for an accurate value of what you can afford.

Posted: Friday, Jul 09, 2010

A good crook..............

A good crook can beat a smart lawyer. G&M October 14th, 2009. Mortgage fraud continues, but it has lessened. The problem is waning. It is mainly and Ontario problem with some happening in BC. Even getting title insurance still allow some risk. Real estate transaction ripe for manipulation because they are complex and specialized information is involved. Most fraud involves industry insiders. Lawyers can be a key ingredient in the scams. It is CRITICAL to get a good lawyer. The brunt of financial losses being taken by financial institutions and title insurers. FSCO has brought in universal liscensing and disclosure which is having a positive impact. But attraction to commit fraud increases with financially tough times. The criminal mind will not cease, where there is a will there is a way.

Posted: Wednesday, Oct 14, 2009

Rate-o-phile

Toronto Star article. October 13/2009. Goes on to describe boasting and bragging at parties about who has the lowest rate and what was your rate? Can be fixed, can be variable but the rate is a big bragging point. Used to be bragging about cars but now it is rate. Not only is rate bragged about but so is term, amortization, 10 year term, TDSR and GDSR a real kama sutra of options! Predicting rates is like parenting a teenager, you think you know but you really don't. When people are 25-28 they talk about dating, next it is where you are living then comes mortgage rates. Sort of a cycle. They don't talk about size of debt, it is all about rate. A broker said "it is not about rate but the important factors are life occurences such as children, job loss and how to plan for that. That is true. Rate is important, the product is even more important and advice is critical.

Posted: Wednesday, Oct 14, 2009

GRR Strategy

We have come across a few business strategies that sound interesting. One that sounds fun and even fun to say was developed by one of our own people. It is GRR and it appears to be strong and work wonders. We should have thought of it long ago! GRR!!!!!!!! GRR!!!!!!!! GRR!!!!!!!! It is a remarkable, centered and viable technique. Works wonders.

Posted: Tuesday, Oct 13, 2009

Commercial lending

Commercial lending is taking on a life of its own. The market is tight for commercial lending but volume we are doing is rising and a good deal of that is based on who we know. It is getting to the point where we might open a separate unit devoted to commercial. Might be a niche market for us. It is a new direction but it is opening a lot of doors. We did a project in Hamilton which was viewed as very very difficult. Client had tried a number of sources to get done. Project was good from common sense pov but was tricky to get done because was interim financing. We brought in large private lender to do interim and when project complete we will re position with a normal commercial lender. Robert did terrific work on this.

Posted: Tuesday, Oct 13, 2009

Burlington client resolution: 60,000 in savings over 5 years

There was a situation in Burlington where a client was bamboozled into a very bad first mortgage at 10.50%. The clients income was excellent but credit was bruised a touch, not much. We packaged it up and they got a fantastic first mortgage at 2.35%. There payments per month dropped from 2200.00 to 639.00 per month, it was that dramatic. By arranging that mortgage and giving the client very good advice we estimated that we saved the client up to 60,000 over that 5 year term, the rates are great that we offer but the advice is what really adds to it. 60,000 in savings is nothing to laugh at. Client very very grateful for the inside help.

Posted: Tuesday, Oct 13, 2009

Rate Movement

Rates are about to rise again. The five year fixed benchmark is going to jack up 3/8 of a percent. It means that those with preapprovals or mortgages that will fund within 120 days have a huge edge. If there is strengthening in the Canadian dollar it directly relates to our interest rates. The rates may move up or down for a number of reasons but a very good prediction is if the Canadian dollar gets stronger, the rates go up and vice versa.

Posted: Tuesday, Oct 13, 2009

Self Employed

There are rumours that some self employed programs that are high ratio may be eliminated or cut back dramatically. The default rates on these programs are sky high at the moment. If you have been self employed two years with proper documentation and a good credit rating, there are great options available now. But these may come to an end.

Posted: Tuesday, Sep 15, 2009

Finance Companies

We have seen a situation that can hurt the public. A client may need a loan quickly, they go to a finance company and arrange to get a loan quickly but it is fairly costly. Months later the finance company phones the client to tell them what a good client they are. The company then mentions that the client has a mortgage and why not turn the whole thing into one larger mortgage. There are a few problems. First is that the client is not aware until they sit down and sign documents what the interest rate is, usually 10.50% on a first mortgage with a 5 year term. This causes the TDSR to soar and the client is in much worse shape than prior. At Fair Mortgage we deal with all situations and give good advice. The worse situations where clients have been treated very badly, stem from the jaws of finance companies.

Posted: Tuesday, Sep 15, 2009

Rates Dropping

Rates are moving down a touch. Variable has gone down to 2.75% and 5 year fixed 4.34%. Canadian economy is relatively strong and US economy there are questions on. We are getting a lot of calls from past clients wanting to lower their monthly payments just in case they lose income for a while.

Posted: Wednesday, Jul 08, 2009

Rates Moving Still

The benchmark variable has stayed at 2.85% but the fixed have drifted upwards again to 4.40%. The fuel for the rise is the Canadian dollar being strong. People who were preapproved at 3.79 or 3.84 are very very fortunate.

Posted: Monday, Jun 15, 2009

Koodo vs Telus

One of our agents switched from Telus to Koodo. He was paying 390.00 to 500.00 per month. For the exact same service, even additional minutes he got the first bill for 124.72 from Koodo. Same service just a huge difference in price. What is funny is that Koodo is a division of Telus.

Posted: Monday, Jun 15, 2009

Commerial Mortgages

We have been doing more and more commercial mortgages lately. We got a terrific deal for a client on a restaurant in Toronto and are working on another restaurant in south west Ontario. The Toronto restaurant is very interesting and financing was not easy to get but the end result was the client got a great deal.

Posted: Friday, Jun 05, 2009

Rates Changing

Middle of this week rates started bottoming out and moving a little bit up. The 5 year fixed moved from 3.79 to 3.99. Factors that were cited were a stronger Canadian dollar, when the dollar has gained strength rates moved in almost lock step. Another long term factor is the US Debt. Many cite the fact that the US debt will cause inflation to rise which will cause rates to go up. We explained to clients the differences and most have gone with fixed but a few have taken variable. It is hard to predict rates but the general view is they are going to gradually rise.

Posted: Friday, Jun 05, 2009

Self Employed

There are still some great options for self employed clients. You need to be self employed for 2-3 years with a business lisc and proof that you have been self employed for 2-3 years and a good credit rating and regardless of your income, you can qualify for a home with 10% or you can refinance your home up to 85% at fully discounted rates. This is a bargain to those that fit the bill. Insurers have tightened up a bit but it is still a good program. There are other avenues to explore as well. We probably won't become as varied about product as we where 2-3 years ago but still, there are good solid products out there for the self employed individual with good credit. \

Posted: Wednesday, Apr 22, 2009

Renewal Client in Oakville

A client wanted to discuss renewing their mortgage in June and what could we do. We quoted current rates and they are very very low. This client banks with a particular bank and that bank is notorious for quoting a rate and making the client work to negotiate a better deal THEN coming forth with an improved price. Said to the client that if they were a valued customer why don't they get the best rate right from the get go. There are a few banks that quote the fully discounted rate right from the start and this is very good. Others quoted posted and haggle. If a client is foolish or naive they may opt for the posted rate which means that the bank is making a huge cash grab. The client was told the stratgegy employed by this bank and to be careful, he will compare their best against our best and whoever is lowest, wins. Fair enough.

Posted: Wednesday, Apr 22, 2009

East Mountain Client

One year ago a client was in a bind in a rent to own situation. They had signed a 5 year rent to own agreement. The landlord had said to them to either come up with mortgage money or forfeit the house. They were given a short amount of time to do this and real estate agent involved behaved badly. We recommended that the client take a 1 year term to resolve them out, a stop gap while they continued to re build their credit. They did so and today we signed them up for a new mortgage at 3.95%. They are ecstatic and it means a lot to them. They can't believe their savings and what a difference it will make. They are good folks.

Posted: Wednesday, Apr 22, 2009

Great Rates

Rates have gone down again. We are hitting 3.00 for the variable and 3.95 or lower for 5 year fixed. Some clients believe strongly in the variable product. The general thinking is that the US debt will cause inflation which will cause interest rates to go upwards. Some clients are electing for 7 and 10 year fixed to lock rates in over the long term. One thing is for sure, rates cannot go down down much further but they have a lot of room to move up.

Posted: Wednesday, Apr 22, 2009

A change in trend

What we noticed was that from mid-September until mid-December our work was okay, it went down a bit from the summer. In mid-December it went down dramatically, really slowed up. From mid-January it got started again but it was up and down. Last few weeks have shown a return to normal times and we are glad of that. The AIG story out of US is like a plague, last week was great and then on weekend there are more rumours about AIG and more losses combined with the US Steel announcement recently about 1500 layoffs. RBC said that it might be a time to buy a home and this, combined with the US trying to get solutions for the housing crisis in the states, is a good thing. We have come to accept it being quieter and it is nice to see it return to more normal times, it might bode well for the future.

Posted: Wednesday, Mar 04, 2009

Broker of the Year 2009 (independent) for Canada

We have been nominated again this year for broker of the year, independment. Last year we did not win but it was an honour to be nominated. The company was formed 3 years ago, being nominated 2 years out of the 3 that we have been in existence is quite something. All of our people should take a bow, they have all worked very hard.

Posted: Monday, Feb 23, 2009

Shayam Kaushal

Shayam passed away from cancer yesterday. Information on Shayam is on the IMBA web site. He was a mentor and a friend to many. He was gracious with his time. He was a very kind and giving individual. He will be sorely missed. They say a "person well remembered never truly dies" that may well be the case with Shayam. Everyone here wishes the best to his family. He was a very very good person. He was a credit to the entire industry.

Posted: Wednesday, Feb 11, 2009

Lending Capacity of the banks

Our banks are going full tilt on lending. There has been a general tapering off of subprime lenders as well as tapering back on products. Amortizations have been reduced a bit from there highs, which is a good thing. A lot of alternative lenders are no longer in the picture. Equity and private lending is still good. On the equity side lenders are going at 65-75% LTV. Prior they would have done 75% under almost any circumstance. On the private lending the LTV is generally 80-85% depending on the circumstances. The ability to get mortgages is not greatly reduced from the summer. If someone has an alternate situation, that may be impacted but for most people, very little has changed. Rates are great and the criteria for lending is much the same on the "A" side. On the "B" side there have been more changes but much is still possible. The biggest problem some people have is that they were in an "A" situation prior and are now drifting into "B". The market where there has been a real pull back is commercial. Commercial lending right at the moment is very tough.

Posted: Saturday, Feb 07, 2009

Appraisal values

Appraisal values are coming in fairly conservative. We are noticing that on an average home, we are seeing a devaluation of 20-25K over what might have been 6 months ago. The purchase market is much slow. The refinance market is fairly brisk. If a client purchased with 10%, 5% or no money down in the summer, they are having a tough time if they want to sell currently. If a person wishes to sell it is good if they can hold off until the market picks up.

Posted: Saturday, Feb 07, 2009

Trends

Interest rates are very low. There is a slew of negative economic news at the moment. We have spoken to a number of large investors who are going to buy good quality US and Canadian equities because they think things will turn around. The general feeling is that by summer things will take a turn more positive. Psychology plays a huge part in dealing with the crisis. The injection of Canadian and US government funds should help to get the ball rolling.

Posted: Saturday, Feb 07, 2009

Generosity

One of our people has gone out of his way to show generosity both to clients and fellow agents and it has made a big difference. As a mentor and leader this person is going above and beyond. It has made an impact on all of us. Morale is great and the deeds of this person have made a big impact. New agents have been helped and the company as a whole has been helped because the attitude and leadership of this person is such that we all gain. During the last 2 months when the economy was up and down and there was a lot of uncertainty about what would happen, this person was optimistic and unwavering. I think we have all benefited from that. He has made a profound impact on all of us. We are all grateful to him.

Posted: Sunday, Nov 30, 2008

OECD Real Estate Report

The OECD report for real estate world wide is fairly positive for Canada.

"I would be delighted to own a house in Canada right now. When we assess relative vulnerabilities, Canada does not score badly." - David Turner, Senior Economist, OECD.

The general report showing the run up in real estate prices to the peak and the subsequent decrease, bode well for Canada, France is in a likewise similar situation where the run up was good but the decrease has been marginal, especially when compared with other countries. This is how it plays out:

OECD Average: 7% runup from 2005 to peak. 7% decrease since peak.

US:

9% runup from 2005 to peak. 10% decrease since peak.

Japan:

5% decrease from to 2005 to peak. 4% decrease since peak.

Canada:

26% runup from 2005 to peak 5% decrease since peak.

France:

22% runup from 2005 to peak 2% decrease since peak

UK:

15% runup from 2005 to peak 8% decrease since peak

Spain:

13% runup from 2005 to peak 5% decrease since peak.

Ireland:

17% runup from 2005 to peak 13% decrease since peak

Switzerland:

4% runup from 2005 to peak 0% decrease since peak.

Canada has had net gain of 21% in this time and France likewise, has had large increase of 20% net gain. Switerland has been fairly conservative and not moved too much. Ireland has taken fairly big loss with 13% decrease and US has taken another digit loss of 10%. Ireland still has net gain of 4% and US has net loss of 1%. Both Ireland and US stick out as having fairly difficult situations. World wide, Canada is fairing well both in relative house prices and our economy. It is good to live in Canada. There is hope in Canada.

Posted: Sunday, Nov 30, 2008

SISO Gala/Dinner Friday, November 28th, 2008

SISO (Settlements and Integration Services Organization) which assists new people to Hamilton getting settled, is putting on there 15th anniversary gala this Friday. We are pretty excited because they offer belly dancing and it gives us an opportunity to show our skills. 6.00 cocktails and dinner at 7.00.

Posted: Wednesday, Nov 26, 2008

Spectator Article: Joan Walters

November 26th, 2008. Hamilton Spectator article: "Full pain of recession hasn't hit us - yet." Interesting article. States parking lots at shopping malls full, car dealers sold more in one month in fall than anytime all year. Power of sales not as bad as prior recessions. Canada has gotten off easier than U.S. We have stable banks, healthy economy. We are slowing down but doing better than most countries. Forecast for future: -OECD says we are headed for significant recession -Conference board of Canada says auto industry will lose 1.7 billion this year and 15,000 jobs though 2009 -budget deficits with feds may spike Lessons: Debt loads are high. Live within your means. Retail sales may take big hit over next few months.

Our experience: for last few months, since economic problems really kicked in we have found it very up and down. Some days very very busy, other days quiet. It seems like consumer are paralyzed about big items like mortgages and maybe cars. Perhaps the public just wants to see how this plays out. There are so many mortgages in our area that are auto and auto parts related that if the industry downsized and big three were no longer there, it is hard to see how things would go on as normal. The fact that Honda and Toyota and others are filling a void is great. Some clients ask us "is if fair to bailout three while not giving something to Toyota and Honda who have done well." Interesting point.

Posted: Wednesday, Nov 26, 2008

Good Web Site

A good site is www.canadianmortgagetrends.com. It is probably of real interest to industry insiders but the news might really interest the general public as well. There is a lot of information here which maybe useful.

Posted: Tuesday, Nov 18, 2008

Positive Outlook

We have been getting a wave of very poor economic news. The auto industry in both Canada and the U.S. are having a very bad time. Since mid-September when the bad banking news first hit and the world got badly jolted, we have had ups and downs and the regular volume of mortgages we do have gone up and down. What has helped us greatly is that we do all types of work, so we tend to keep steady no matter what. We had another employee meeting today and it was excellent. We don't want to be simply an excellent independent mortgage broker but we want to be something different. We want to shake things up and this seems the best time to do it. We have total flexibility on what we do and when. The key word might be "freedom". There is not much holding us back. In such tough economic times there is almost a sense of guilt that things are going so well and we are so buoyant.

Posted: Wednesday, Nov 12, 2008

October 26th 2008 Predictions

This is really going on a limb. These are thoughts as to where the economy might go. (1) Barack Obama wins the presidency November 4th. Following this is a Canadian, American and world wise sense of hope. Markets rally. (2) The U.S. may elect majority Democratic house and fillibuster proof senate. (3) Things stabilize in house prices. People wait during the next two months. (4) January 20th when he is inaugurated there is another surge in confidence and hope. Markets rally again. (5) He has six months unfettered to try bring in laws and regulations which may equalize things, make things more balanced. His goal may be a more equal distribution of income. What U.S. looks like in October 2008 may be very different from U.S. after January 20th, 2009. (6) After six months and the bloom is off the rose. The rubber hits the road and it becomes a real test of his character. The U.S. congress will push back and test his will. (7) U.S. has shown itself very elastic to change. It has faced huge problems prior and overcome them. Leadership, trust and hope were the key.

LEADERSHIP & HOPE & TRUST. If he has these he can lead U.S. and world out of the problem.

Posted: Sunday, Oct 26, 2008

Home Values - City Tax Assessments

There has been a fairly big decrease in home values lately. It is heightened amongst very high end homes in Ancaster through Toronto, In the last weeks we have seen: One home that went for 235-240K on the central mountain. It got appraised at 210K recently. Another home which we appraised at 315K and probably would come in now at 295K got assessed by the City of Hamilton for 375K which is actually highway robbery. The City of Hamilton tax assessments are way overvalued, they don't have any reality to them. Another person with a rural property worth 180K got assessed for 3087.00 per year when that tax bill should be around 2100.00 at the most. In the case of the 180K house and the 375K house the clients are going to appraise the house seperately and use that data to try and fight city hall. People are having a tougher time, they don't need the city unfairly adding to their burden.

Posted: Monday, Oct 20, 2008

16 Minutes

A client wished to refinance their mortgage. They had a large amount in a savings account with a large lender. That lender had the rate of 5.89% for a five year fixed mortgage and requested that lender in particular. We did as he requested. We submitted for approval, the client had a very nice house, great income and good credit. The credit rating was perfect but only small drawback was that it was about 1.5 years old. But perfect. We submitted to who he requested, they are a very good company. Two days later we got a slight decline citing that the credit was not lengthy. We then took the decline and submitted it to another lender which was almost a clone of the first with the exception being that their rate was 5.79% so a bit lower. We got a full approval back in 16 minutes. Both the client and we were very impressed. Both lenders are good, but the one with the lower rate had the fastest turnaround time and they approved the mortgage as the client wished.b

Posted: Monday, Oct 20, 2008

Barack Obama

We spoke with a large private lender whom we have on going relations for a long time. We had two mortgages to get his opinion on. He said that many private investors are holding off until November 4th because they want to see what happens on the U.S. election. How that election goes will have an impact on lending decisions.

Posted: Sunday, Oct 19, 2008

New Employees Needed

We need more people for Oakville and more for Hamilton. We are looking for an individual who is: -self motivated -organized -personable. Someone who likes working within the framework os a positive team environment. Someone who enjoys giving advice and solving problems. If you are that person or know that type of person, let us know. Robert 289 237 0797 Graeme 905 730 9444

Posted: Sunday, Oct 12, 2008

Economic Crisis

The Canadian economy and the Canadian banking system are said to be the strongest in the world. Because the world is in a downdraft, we get side swiped. We have had other severe economic problems and the key thing was to not panic, reduce fear and to logically address the issue. When there has been prior severe economic problems, having: -leadership -trust -hope seem to be the factors in bringing about change. We need change. We need it badly.

Posted: Sunday, Oct 12, 2008

Ten Steps to Sane Spending: Hamilton Spectator

Meredith Macleod ran good article on September 20th, 2008. Articles recommendations: TAKE ACTION: Make a plan, make a budget. Get help from financial planner, accountant or expert in the field you need. Set budget and keep to it. DRIVING: Slow down, keep tires properly inflated. Car pool, public transit. Buy a car 1,2 or 3 years old. MORTGAGE: Switch to weekly or bi weekly frequency. Our recommendation is also buying well within your limits then set amortization for 15 years, you get HUGE bang for your buck. GROCERIES: Use coupons and buy in bulk. CREDIT CARDS: Limit use, maybe have one card. Set a budget and payoff more than you spend. Decrease the balance. LIVING THRIFTY LIFE: This does not mean living bad, it means living within your means and you may be happier as a result. Article mentions Salvation army, Goodwill, Value Village, craigslist and kijiji. You can live more modestly even with having to use them. INVESTING: Don't watch markets, you will worry. Think long term. (easier said that done right now). BANKING: Automatic savings or RRSP plans. On line bill payments. No fee banking. STICK WITH IT: Make it a habit, make a commitment. Just do it. MONEY WASTERS. Eating out, dry cleaning, cable and internet packages. Avoid extended warranties.

Bottom line: budget, discipline, live within your means, be happier and live more stress free.

Posted: Sunday, Sep 21, 2008

New Rental Program-Small Investors

This is a new program brought in to help clients who have no rental experience or very limited experience. Not intended for commercial landlords. Can be used for up to five properties, including a primary residence. You must put at least 5% down on each. Must have a beacon score of 650. Flexibility of three insurers. 80% rental offset. It is a very good niche product.

Posted: Sunday, Sep 21, 2008

Private Lender Perspective

Private lenders are pulling back. They are being more consevative on values, they are pulling back on the LTV or loan to value. They are being more choosey about rates and fees. Right now it seems that cash is king is very true. Many private lenders are doing well. The cautionary note is that many are doing fine as long as values don't pull back too much. Because of the subprime pullback of lenders and the ones that haven't closed have pulled back on their products, this has left a void that can be filled by private lenders, much as it was done in the past. A private lender or institutional lender has to be careful about what they do. The focus even more so is on LTV and the client situation.

Posted: Monday, Sep 15, 2008

Unsettling Mortgage on Hamilton Mountain

Back in early June we had a past client that had run into difficulty. He had a normal mortgage with a understanding lender but had run into arrears on the mortgage of about 5 months. We advised to re structure the mortgage and sell the house and take the proceeds and run. The re structure was done and he listed the house in early June. We had a conservative appraisal at 237,000 and he listed above that but we were pretty confident he would get the price he wanted and move on. He then lowered the price several times and is now listing for the 220K to 225K range. The unsettling thing about this is that we always get a conservative appaisal for difficult work. When the client is forced to sell below that value, it is unusual and we are taken aback. The market in the last few months has really corrected. The degree of the correction seems to have accelerated in the last 6 weeks.

Posted: Monday, Sep 15, 2008

U.S. Problems

Today they announced that Lehman Brothers, the large U.S. investment bank, was going bankrupt. First you had Bear Stearns, then Freddie Mac and Fannie Mae and now Lehman. For quite a while we have been saying that the parallels with 1932 are great, it seems to be coming to fruition. The subprime crisis first became apparent in August of 2007 but the ramifications have been wide spread. Seems like the U.S. government cannot keep bailing companies out. The stock exchange dropped 504 points today, a record since 9-11. They say that 98% of the commercial banks in U.S. are safe. It is investment banks where the worry is. Not sure where this will go. One commentor said that the crisis was 75% done. Hope they are right. Another person compared to Lehman Brothers as over 150 years old and the rock of Gibralter. Lehman has been through the Great Depression and 150 years of ups and downs. When Lehman goes bankrupt the commentor asked "does this mean that America is bankrupt?"

Posted: Monday, Sep 15, 2008

Auto Workers

Clients that are in the auto parts or directly in auto assembly are having a difficult time right now. It is in the news all the time. We have noticed an increased amount of refinances and even defaults in this community. If you face a work problem the KEY is to address it quickly. It is NOT to procrastinate. That is a slow poison.

Posted: Monday, Sep 08, 2008

Relative to Relative sale.

We are doing an increased amount of home purchases from relative to relative. In general what is needed is the concerned parties need to agree on a sale price, an appraisal may or may not be needed. A letter of employment, paystub, void cheque are what's needed to get this going. It is becoming a much more common thing, it used to be fair rare, now it is common and continual.

Posted: Wednesday, Aug 06, 2008

Ben Bilato

Ben will be leaving us for a new company. Ben has been with us for a long time and made a big positive impact, his technical knowledge and experience with mortgages, great customer service skills and good nature have really made a tremendous impact. We will miss him and wish him well. In the future we will always be there to help should he need. Ben has a great family. He has a lot to be proud of. Best wishes, everyone at Fair Mortgage Solutions. Ben's cell is (905) 975-1016.

Posted: Saturday, Aug 02, 2008

Further Pullback

We just heard that GE Money will be closing operations shortly. GE was considered a good Alt "A" or subprime lender. They had a product for 1 year term which we loved, whereby if the client had good and stable income yet mixed credit history, they would do the mortgage enabling the client to get back on track. This product worked like a DREAM and it helped many many clients. We are sad to see GE Money go. As a company they have always been very professional and very quick. We have nothing but kind things to say and wish all the staff the very best. We will miss the innovation. The options now for subprime are getting tighter and tighter. At Fair Mortgage Solutions we have a lot of options on the lending side, which many do not, but still, the number of options generally open to people is getting smaller and smaller. The sense is that this will take a few years to work out, not months. If a mortgage broker did not have a lot of established connections for getting things done, this would be a worry. It makes you think long and hard.

Posted: Tuesday, Jul 29, 2008

Chain Reaction?

A few weeks back there was uncertainty about the two huge U.S. mortgage insurers, Freddie Mac and Fannie Mae. Both are huge and both viewed as rock solid. They primarily lend high ratio to good clients, normally they would be very strong but with the U.S. economic pullback and reduction in house prices, they were vulnerable and the U.S. government had to bail them out. This sent a message world wide which was shock. When both sold their bonds world wide they did so by stating that "we are just as good as the U.S. government only we pay higher interest." They aren't technically the U.S. government but they are close, they are like our CMHC or Genworth. The Canadian Government reaction was to reduce the amortizations and reduce the "no money down" products." This is a good move, it will only strengthen our system. Our system was good to start with and remains strong. Thank your lucky stars you live in Canada. As much as people love to hate banks and the banking system, it is good that our banks don't fail and that the system is strong. We may hate banks but thank god they are strong. There were occasional stories hinting at a problem with Freddie Mac/Fannie Mae but nothing rock solid, this was prior to the Canadian Government annoucement.

Posted: Monday, Jul 28, 2008

Great Work

Everyone is doing a terrific, terrific job these last few weeks. Can't say anymore. It is really good. Great work.

Posted: Tuesday, Jul 15, 2008

High Ratio Changes-Ottawa

Ottawa announced some changes coming to the mortgage world. The changes are to head off any problems that may pop up. Fundamentally, Canadian market has been more stable. Two U.S. style feature that have been used here for a while are: -no money down -40 year amortizations -interest only mortgages -allowing TDSR to climb too high. These increase default risk and both are going to be eliminated as a CMHC type product. Bank mortgages in Canada in arrears is also stable at 0.27%, the lowest since 1990 and well below highs of 0.65% in 1992 and 1997. The maximum TDSR for insured mortgages will be 45%. A general rule of thumb we use is that up to 40% okay, we have to make sure that to go to 45% it is common sense lending. Under purely normal circumstances we have found 45% to be a strain on clients, a mild strain but still a strain. The move by the Government of Canada is very good.

Posted: Thursday, Jul 10, 2008

Career Opportunites: Hamilton & Oakville

We are a different type of mortgage broker. We have a different approach and a different attitude. It is the right formula. Our clients, lenders and agents agree. What we need are people that love helping people. People that want to work in a very positive and growth environment where there works counts and makes a difference with the general public. We need people that have good creative and innvovative ideas that could be of benefit to us all. We need people that are self motivated and rise to a challenge. We need people that view clients as friends and treat it as a long term relationship. You offer the best advice possible. Advice on the mortgage and advice on the whole situation. A long term view. We want people with balance. We want to make it a win-win-win situation.

We offer you covered overheads such as: -office space -meeting rooms -free E + OE insurance -free credit bureaus -an excellent company reputation both the clients and lenders but also with agents. -growth opportunities -we offer and very much welcome your input and ideas. We are innovative and make positive changes quickly. -a very positive team environment, an environment which brings out your best.

You are not alone, you are with us. We have created a special group and want to grow. Every member so far has had major input into how we evolve and it works dramatically.

The perfect person is someone wanting flexibility and freedom but who is self motivated and customer service oriented. We can't ask for more than that. Call Robert in Oakville at 289-291-3988 or Graeme in Hamilton at 905-388-3176 X-220.

Call us anytime.

Posted: Saturday, Jun 28, 2008

In trust we trust

This is an article in the Globe and Mail magazine report on business for July and August 2008. Outlines the concept of knowing your client, face to face dealings. Tells how on the ultra subprime micro loans given to poor in developing countries the success rate is 98%. It is face to face, know your client. Character, trust and the community. Much of this lacks today, where much of the discussion is distant, over the net, over the phone. Distant. "In today's world of mortgage brokers, ATM's and internet banking, we are far more likely to have a personal relationship with our Starbucks barista than with the person funding the biggest purchase of our lives." Now it is conducted with a few clicks of mouse and the FICO score.

The success of the Grameen Bank hinges on being close to the communities it serves. We notice this when it becomes more important as to the risk of the mortgage. If it is an "A" situation we follow the usual credit, income and net worth rules. If the mortgage is an equity situation, a little more difficult we get more careful about the background and if the situation warrants private lending, we very much get into character and judgement. We have to be VERY careful that someone's money invested is safe and not at risk. Having the transaction more personal decreases the risk. In fact, because it is personalized you can help mitigate the risk by offering advice and suggestions and keeping the client on track. The broker can mitigate risk just by his/her interaction with the client. This is a very interesting article.

Posted: Friday, Jun 27, 2008

Lincoln Alexander

Met Lincoln Alexander on Main street east yesterday. He was scooting around on his motorized scooter. He is a big Hamilton backer, very pro-Hamilton to his bones. Very happy and very postive. A more enthusiastic person would be hard to find. Talked about Barack Obama, Linc said he was the original Obama. Just a very nice person. Talked about mortgages and the subprime crisis in the states and the economic woes, gas prices, food prices. Offered to give him a good deal on a mortgage and he just laughed. Talked for about 20 minutes.

Posted: Friday, Jun 27, 2008

Very Different Client Situation

This situation was so complex, so unusual we weren't sure what to do with it. We will just write down what happened. We were called initially for a client who had a mortgage going into arrears. Client also had a rental property. We suggested a solution to resolve but client put on a very expensive second mortgage on his rental property. Client then ended up losing that property and the mortgage amounts and penalties amounted to more than the sale value. The client was about 4000.00 negative on the sale of a small property. During this time there was extensive commu nication back and forth between our Robert and client. Client lost the rental property and called Rob for advice. We knew the lender who held the first mortgage on the primary property and they were willing to hold off going power of sale if we could resolve the situation out. The major problem was that the mortgage and financing could be resolved out fairly easy but client did not want to sell. This is home he knew as a boy. he appeared to be almost a Forrest Gump type figure. Robert and Robert and Patrick went to visit the client in his house. House was in a good area but in very poor condition. It was primarily of a cosmetic nature but some structural problems in basement. We were not sure how able to cope with the situation the client was. House gradually became strewn with garbage and Robert, Patrick and Graeme gave him food, toiletry items and money to help out. Client did not have apparent source of income. Client seemed alone, no help and he did was coping with three huge issues, each of which would stress out most people, they were: (1) NO income, therefore huge cashflow issues. (2) Power of sale on his rental property. (3) Power of sale on his primary property. Client seemed to further go downhill and no one seemed to help, we were not sure what the relatives were doing. No one seemed to be helping the client. We called COAST, a crisis intervention hotline and they evaluated client and did further evaluations and removed client from house. We also had a church groups that offered to help. At one point Robert and Graeme went to welfare office and stuck out because they were wearing ties and well dressed, I don't think the welfare office gets many clients like that. When they lined up I think the staff were very curious as to what they wanted. House did sell on MLS. There were two things about this which struck us as odd. The first was there was a debate about his condition, we felt he was not in good shape but the government has deemed his competent. It makes you wonder where the bar is set as far as competency. The other aspect which we found out after everything was done, was the client was a genius. Both mathematically and politically he is supposed to be brilliant. We have never had a situation like this before but it makes you wonder how many others are out there in a similar situation but you just don't hear about it. It makes you think. You never know and you should never judge. The staff did the right thing with him. They helped him and gave him good advice. At the end of the day they did a good thing.

Posted: Sunday, Jun 22, 2008

Surprise Oakville Start

We all take our hats off to Robert and his staff. They have all done exceptional well. Our thinking was it would take a while for Oakville going but it has happened very quickly. The first two weeks they exceeded what we expected by a large margin. It has gone much better than we hoped. Everyone at Oakville has done exceptionally well. You should be very proud.

Posted: Sunday, Jun 22, 2008

Zero Beacon Score: Resmor Trust Company

A client wanted to buy a home with 5% down and they wanted to get a 3% cashback but the tough issue is that they have no credit score whatsoever, in fact, years ago they had a minor smudge on their score, but basically it is blank. Many lenders would just automically say it could not be done. It was submitted to Resmor and quickly approved. We provided evidence of credit union loans which were paid perfectly and Resmor obtained CMHC approval. It was a very unusual mortgage and what we found interesting was that they tried hard and did a lot to get it approved promptly. We are impressed, very impressed. A technical and rarely used feature of CMHC is that if the clients bureau is blank yet they have evidence of credit from other sources, they will weigh that in there decision making. Hat's off to Resmor. Hat's off to CMHC.

Posted: Wednesday, Jun 04, 2008

Oakville Inauguration!!

On Monday we opened up our Oakville office. We think that by the end of the month we may be up to 6-7 working from this office. In three days we have been open we have signed up 3 clients. That is much faster than we thought. We thought it would take awhile to get established and we are pleasantly surprised by the speed of activity. Oakville is being headed up by Robert Hooper and he has done a fantastic job or organizing and motivating everyone. Hamilton now has to play "catch up." The "Hammer" has to come through!

Posted: Wednesday, Jun 04, 2008

What Might Surprise a Client

A client might be surprised at the amount of behind the scenes work it takes to get a mortgage done. You take an application and then through experience, you position it with the most appropriate lender so the client has minimal problems. You tailor the mortgage to suit the needs of the client and those needs may change or migrate from start to finish. You communicate those changes with the lender and you act as a true broker, you broker between the lender and the client, you mediate. If a client has a situation that is somewhat unusual it may take a lot of work to explain or "paint the picture" to the lender so they see things as they are. We do not talk too much about how much expertise is involved but I think a number of clients would be shocked at how much work it takes on our part, to get the mortgage done as they wish.

Posted: Wednesday, Jun 04, 2008

New York Times: Tips-First Time Home Buyers

(1) Be picky, but don't be unrealistic. There is no perfect home. (2) Do your homework before you start looking. Decide specifically what features you want in a home and rank them by importance. (3) Get your finances in order. Review your credit report and be sure you have enough money to cover your down payment and your closing costs. (4) Don't wait to get a loan. Talk to a lender/broker and get pre-qualified for a mortgage before you start looking. (5) Don't ask too many people for opinions. It will only confuse you. (6) Decide when you could move. When is your lease up? Are you allowed to sublet? How tight is thye rental market in your area? (7) Think long term. Are you looking for a starter house with the idea of moving up in a few years or do you hope to stay in this home longer? This decision may dictate what type of home you'll buy as well as type of mortgage terms that suit you best. (8) Don't let yourself be house poor. If you max yourself out to buy the biggest home you can afford, you'll have no money left for maintenance and decoration. (9) Insist on a home inspection and if possible get a warranty from the seller to cover defects within one year. (10) Get help. Consider hiring a buyers agent. Unlike a listing agent, whose first duty is to the seller, a buyer's representative is working only for you. They also are often paid out of the seller's commission payment.

Posted: Thursday, May 29, 2008

We Need Good People

We are looking to hire mortgage specialists in both our Hamilton and Oakville locations. Let us know if you are that person. We will also require an administration person part time for the summer, it will last from mid-June to the end of August, Monday-Thursday from 9.00 a.m. to 1.00. Let us know if you are interested in mortgages or admin.

Posted: Wednesday, May 14, 2008

Shayam Kaushal

At the IMBA meeting we became aware than Shayam was ill. We owe a great deal to him. He can be summed up in one word, generous.

About three years ago we were thinking about taking the step and going independent but it was a big step. We called IMBA to ask for advice and they recommended talking to Shayam. I phoned Shayam out of the blue and he answered some questions and agreed to see me for lunch. I found him warm and generous, I was a stranger to whom he had never met before. He shared his background and I shared mine. He was very kind to talk to me and it meant a great deal. He pointed out "what could be done" and not to be intimidated by larger companies. If your idea is good it will succeed. He gave me a lot of advice and I came away from that lunch thinking, "this could work!" He was that enthusiastic. Just talking about the everyday work he had done to build up his independent company gave me hope. Sham has made a huge difference with us. He may not be aware of it, but he did. The concept we have may well do very well and it is in large part because of his generosity and nuturing of another person that made a difference. The fact that IMBA would have people like Shayam being associated with it raises the bar and does them very proud. Three years ago Shayam was saying about illness he had battled and continued to battle. It is our sincere hope that he does well and battles through. I am not sure exactly how serious his illness is. He is a very generous person and has made a big difference with many many people. He is a credit to his family and he is a credit to the whole industry. He is simply a generous and kind man. He has many an impact on a great many people. We all thank you Shayam. Your are a great person.

Posted: Friday, May 09, 2008

IMBA Meeting

IMBA held there annual conference on Thursday and Friday. The seminars were useful and well managed. The Annual meeting was colourful, it was democracy at its best, people getting up and commenting on there point of view. It was good give and take. It is good that people can air there views and that it is not simply closed. Another element that came out was how hard the board work. It is a group of people who are trying their best and giving up many hours of work and home to do so. They are by and large people who care deeply about the industry. The cost to attend was 87.00, a bargain. IMBA comes across as grass roots and down to earth and really pro-broker. The Gala at the end of the evening was great. Revenue was down primarily through many brokers not renewing and perhaps dropping out of the industry. In the last year the industry and banking has taken quite a few hits.

Posted: Friday, May 09, 2008

Mystery of Mortgage Meltdown

This is an article by James Daw in the Toronto Star, May 1st, 2008. It is very good. Subprime crisis in U.S. has a good offshoot in that central banks are lowering rates, our cost of borrowing is lowered. But some banks are nervous about lending because of losses. The U.S. subprime crisis has affected the whole world. Lenders could lose 1 TRILLION dollars in subprime crisis through irrational and immoral lending. Governments have lowered the prime but the banks have only partially passed that savings on, they are keeping the rest for profit to hedge against future uncertainty. Canadians tend to knock down their mortgages more than the U.S. because the U.S. has tax deductable mortgages many want to max out the mortgage amount and max out there deductions. We are much more solid, we have a stronger system. Going bi weekly accelerated for your payments and making extra payments will allow you to gain enormously on your net worth.

Posted: Saturday, May 03, 2008

Mark Carney

Mark Carney is the new Governor of the Bank of Canada. In a Toronto Star article he points out that he is worried about long amortizations and high ratio mortgages. On the high ratio mortgages, up to 100% LTV, they have been around for a while and the underwriting criteria on them is strong. If there were a large market correction both clients and banks could be left hanging but the fundamentals compared with U.S. are different. Our no money down is different from the U.S. no money down. The other aspect is 40 year amortizations. This is a good point. The 40 year am is popular and becoming more so. There is one lender in particular who has stuck to 25 year amortizations and is probably losing business for it. Clients want the option. If a client goes for 40 years we generally recommend it as a tool, a short term instrument. A person may go for a 40 year amortization but a key element is when they are able to, they should make extra payments to knock the amortization down. If you take 40 and literally make the minimum monthly payment that is not a good thing. 40 years was brought in from the U.S. and it has become very popular because the payment looks low but long term you have to be careful. A good example is going for 40 year am when one of the parents is off work, say taking a couple of years off for children, when the parent goes back to work they have enjoyed the low payment when they need it and can bring the payment back up to a 15 or 25 year schedule. We love 15 year amortizations, this is a good balance where your payment is not too bad but you hammer the dickens out of the mortgage. 40 year amortizations can be a useful tool. High ratio mortgages that are underwritten correctly are the norm. If you were to go to 20-25% down minimum you would have a lot of angry people.

Posted: Saturday, May 03, 2008

Rent to Own situations

Rent to own is complex. There is one word which leaps out us, "vulnerability." The client who is renting is very vulnerable. We had a situation recently where a client had rented for five years, building up a good chunk of equity and the landlord quickly said they wanted paid in full or the clients would be put on the street. We arranged the mortgage on time but it was not easy and the client was upset at the thought of being thrown out after being a tenant/owner for so long. If someone asks us about the value of rent to own we are usually against it, we hear many horror stories. Many bad situations. Maybe 85% go down the drain and 15% work out? That is just anecdotal, nothing scientific about it. But we hear many many heard wrenching stories about it.

Posted: Saturday, May 03, 2008

Oakville Office

We are expanding shortly into Oakville. Our new office will be set up shortly. We are getting more and more work from Oakville, Brampton and Mississauga. We are now hiring agents for both Oakville and Hamilton. If you know of anyone who believes in: -customer service -ethics -has passion for clients Please fax or email us the resume. Have a good weekend.

Posted: Friday, Apr 25, 2008

Decluttering.ca

We did a mortgage in Oakville recently and the client was kind enough to give us a card for "decluttering.ca" they specialize in just what they say, de cluttering a home getting ready for sale. The phone numbers are 905 469 0908 and the cell is 416 460 8098 email is silott@cogeco.ca or www.decluttering.ca Client said they did great work.

Posted: Tuesday, Apr 15, 2008

Sales Increase over 54%

Our year to year report is in on Fair Mortgage Solutions. In one year, with the same number of agents we have increased our production by over 54% in a tightening market. This is in the face of the quietness in the industry. We all deserve a round of applause, it is a good effort. It is good to stay so positive even with all the bad mortgage news out of the U.S. Canada is much better, the fundamentals are good. This is a good sign. We are all very pleased.

Posted: Tuesday, Apr 15, 2008

Mrs. D

Well, it has been a few weeks and Mrs. D seems to be fitting in great. Her sense of organization is terrific. We have all noticed her penmanship. Some of ours is horrible, Egyptian hieroglyphics yet Mrs. D has lovely writing. What a change. She has picked up very quickly on what needs doing. She is very low key, which is good.

Posted: Tuesday, Apr 01, 2008

Rate Decrease

Fixed rates are drifting down gradually and variable may go down yet again. There are some great deals on the variable open and variable closed mortgages.

Posted: Tuesday, Apr 01, 2008

Power of Attorney

We are not lawyers, we are mortgage specialists but we can give some general thoughts on power of attorney of POA. There are a few different types, ranging from specific property oriented to a more general form for a person's welfare. If you have POA on a relative in general terms you are acting legally on behalf of that person, they may be incapacitated in some way. Some times a son or daughter will have POA on a property where the parent is fine but the parent does not want any responsibility of the day to day going's on. POA has been associated with fraud, to an increasing degree. It has reached the point where if a clients states they have POA to act for someone the instant red flags go up and the banks almost assume, to a great degree, possible fraud. The banks have been stung by doing POA mortgages. It has reached the point where if a normal mortgage is being processed, the commitment no matter will state the dangers and concerns of POA. If a child acts on behalf of a parent and has POA, the courts can later decide to set aside the mortgage, thus rendering invalid the mortgage brought under POA. If the POA was arranged with a particular lawyer and that lawyer is acting on behalf of the same client, there are situations where it may go through. We are working on a mortgage free property in Stoney Creek where the client has a valid POA and the mother is suffering from dementia. The client may act. The lawyers invovled have to be very careful that it is valid. In a Toronto Star article by Bob Aaron today it states: "In the wake of cases like this, new rules go into effect on April 7/2008 in the governments electronic land registration system. The rules will make it much more difficult to use a POA - even a valid one - in a real estate transaction:" POA might have been a good thing but some have taken it to far and tainted the concept. "After this date, a lawyer will be required to certify that he or she has reviewed the POA documents with the person using it and that this person is acting within the scope of the document."

Posted: Saturday, Mar 22, 2008

Divorce

We have had a real run up of clients going through divorce. We advise them of there options, many times they talk to us together and we let them know what can be done, what the bank requirements are, what the options are. A key recommendation we make is to try and keep it as peaceful as possible, even for the kids sake. Divorce can be a very wrenching emotional issue and we provide good advice and options for almost any scenario.

Have a good Easter.

Posted: Thursday, Mar 20, 2008

Lori Corkill

Lori works for a local equity lender named Effort Trust. They are an institution in Hamilton and have expanded to Toronto. Lori is the manager of mortgages has been there for a long time.

We just wish to pass on our appreciation for a very very difficult deal that closed on Friday. Without Effort's help and understanding of the whole situation the mortgage would not have closed.

Lori has done her part in providing the mortgage and now the ball is in our court and the clients court. The intention is the re build the credit rating and provide the client more options down the road. In terms of ability and professionalism Lori cannot be beat. Where she really makes a difference is her basic humanity. It is a characteristic not often seen in banking.

Posted: Thursday, Mar 20, 2008

A subprime mortgage: Good or bad?

Subprime mortgages have taken a real knock. The news is constantly going on about it. First, a definition. A subprime mortgage is a mortgage where the income or credit can be below prime criteria. Thus "sub" prime. Subprime mortgages are used when there is job loss, divorce, illness and a variety of other purposes. They can serve a huge purpose and there reputation is being blackened. Subprime can be good and they can be useful. WHERE THEY ARE BAD is when given to a person who cannot manage it. In the U.S. they would give mortgages to almost anyone based on a "self dec" of income, you could write whatever you want and based on what you wrote they would give you a mortgage, many times it would be much more than you can afford but brokers and lenders were greedy and took advantage. I think this crisis is gods way of getting back. In our experience, if a self dec is used in Canada it must be fundamentally common sense, it must be good for the client and lender. Another aspect was underwriting criteria on variable rate mortgages. If the U.S. mortgage is 1% for 2 years then jumps to 8-9% thereafter, the U.S. lenders would underwrite on the basis of "can the client afford 1%" in Canada the lenders would say "can the client afford 9%" so it is night and day. The subprime market has withered since August 2007, but, subprime mortgages have been a godsend to many, many people. We view them as a temporary step. A client who came in today was a past client from 3 years ago. We got him an AGF equity based (sub prime) mortgage. We felt it would be 3 years for him to re build. His credit score was about 500 which is pretty low. We advise him on the future, he did what we said and today he has a beacon score of about 650 and has a mortgage with Scotiabank. So he has climbed to the top of the ladder and he thanked us for the advice. Subprime helped him and it was a temporary instrument. Right at the moment, because of Bear Stearns, because of the U.S. problems there is a fear among people. People laugh but we think it is very much like 1932 all over again. The lessons from 1932 would serve everyone well.

Posted: Tuesday, Mar 18, 2008

U.S. Fiasco & The Wise Man

In August 2007 the subprime crisis came to a head. Prior to that there were months of rumbling about problems. The crisis hit and the U.S. news have never been good ever since. It seems to get worse and worse. Bear Stearns was bought out by J.P. Morgan with banking from the Federal Reserve board and the U.S. Fed is dropping prime by 1%. It dropped prime again a few weeks back. The message this can send out is PURE panic. The subprime crisis has migrated to the point where no one knows where it will end up. Canada's banks and lenders have always been fundamentally strong. Some of the key subprime lenders have gone by the way side, most have gone by the wayside but the core "A" lenders, core "equity" lenders and core "private" lenders are still there, doing what they have always done, perhaps being a bit more cautious but still active. A few years ago with the rise of subprime lenders from the U.S. and with the addition of Canadian lenders, a very wise, elderly man said it was no good. His advice has always been spot on. He is like the Oracle of Delphi, his judgement is that good. We debated these new lenders coming in, we are Fair Mortgage were pleased that there was more options for clients. Our friend same that it maybe so but the lenders did not know what a downturn was and he kept saying it was a house of cards. This has proven true. When he said it at the time we were not sure, it could have been an elderly person just going on. When we talked to him this morning we had more discussions, the gist of which is: (1) The Canadian Market is fundamentally good. (2) Subprime will continue to get a bad rap and brokers will rely on a blend of "A", equity and private lenders. The way it was done in the old days. (3) The short term unsecured market will take a hit, cards, PLC and loans, that is where the next story will unfold. (4) His attitude: Relax, things happen and things will pass.

His comments have always been excellent. He worries about the high rise condo market. This unsettles him. I am not sure if that is valid or not but based on his past hitting percentage, I would not urge family members to buy high rise. His advice to clients and manner of lending have always been exceptional.

He is a very wise and very smart man. We have tremendous respect for him and that has steadily grown.

Posted: Tuesday, Mar 18, 2008

Mrs. "D" Receptionist

Diane or Mrs. D, has just started as our receptionist/admin person. The volume of work is such that we need some help handling it. She could be a great asset to us and we look forward to working with her. Good luck Mrs. D.

Posted: Monday, Mar 17, 2008

Open 4.75%

This product is working out well for us. Clients like the flexibility and structure. Going variable right now is a good suggestion, most closed variables are 4.75 but getting a totally open mortgage at this rate combined with good customer service is tremendous. A good example is a client that came in from the Middle East, they put down a downpayment but anticipate getting more money over soon, they can chunk down on the mortgage whenever the funds come across. It is a very flexible product.

Posted: Monday, Mar 17, 2008

Refinance vs Bankruptcy

A client in the north east end was referred over for a tough situation. Client had good credit but they were downsized on their job and income dropped dramatically. The cashflow was tightened and they have about 50,000 worth of credit cards and loans in addition to the basic mortgage. The person who asked us to look at it wanted a second mortgage then the client would declare bankruptcy. We worked with the credit rating, income and mortgage amount and using a 40 year amortization we were able to re package what they had into one mortgage payment, and elminating most of the credit card debt. Key part was getting their TDSR down to 39% from 58%. It is a measure of stress, one is easy and the other is very stressful and equals bankruptcy. They now can avoid all the problems and should be well set.

Posted: Monday, Mar 17, 2008

Our Advice

A client called today that was referred by a friend. She said that she understood that we gave good advice to clients and we were pretty grateful for that. She said that she was willing to pay us for our advice and we said that is not necessary but it was nice to offer. Many times the advice we give saves the clients dramatically. It was a very kind offer and we will run application tommorrow and gave advice on it. Again, we try to make it a win win win. Everyone should be very happy with the outcome.

Posted: Monday, Mar 17, 2008

Customer Service

A mortgage closed in Stoney Creek. It was a very difficult and very involved situation. A key element was transparency for all the lenders and the clients. When we were told on Friday that it closed we were very glad for the clients, we know it meant a great deal to them. They are going to bring us over a bottle of wine as a gift. Being St. Patricks day they wanted to go for a beer but we were pretty busy. The mortgage was put together with help of three lenders and they did a great job. The mortgage closed on Friday but our job now begins because we intend to get the client to a good position then combine the three mortgages together. This is one for the record books In August 2007 we did four powerful stories at the subprime conference in Toronto but this is a bigger deal than all four of those put together.

Posted: Monday, Mar 17, 2008

New Home Buyer Seminar

We are participating in a new home buyer seminar at Mohawk College, this Saturday morning at 8.45. There will be a morning session and afternoon session. It is being conducted by Rick and Krista Deverson. We will provide mortgage information, there will also be legal and home inspection advice. Should be good.

Posted: Thursday, Mar 13, 2008

Great Rates

The variable closed is down to 4.65% and the variable open is down to 4.75" The 5 year fixed remains at 5.79%. There maybe another rate drop shortly.

Posted: Thursday, Mar 13, 2008

CMP Awards February 29th, 2008

We had a great time at the CMP awards gala in Toronto. We did not win submprime or independent broker of the year but we feel honoured to be included in such company. Our "Full Monty" video skit was a hit. Should make it to Youtube. We grateful for all the help we have been given by many people, we did not get to read our acceptance speech but this is what it would have said:

"we would like to thank our wives and girlfriends who have been so supportive. We would like to thank CMP and the judges. We have a big thanks to give our fellow Full Monty crew of: Ben Bilato, Robert Hooper, Patrick Quitasol and Graeme Moss. We would also like to thank Sham Kaushal from IMBA, Fred Testa of Invis and Moe Forget of Moneyconnect who gave us good advice and gave us good karma. We would also like to thank Mike and Marsha Turtel who have helped us do many difficult deals. We also owe a big debt of gratitude to Chris Grabiec and John Janisse from the Dunham group who have helped us with both web sites and have supported us in many ways. They are truly good friends and we are lucky.

We thank you all!

Posted: Monday, Mar 03, 2008

Stoney Creek Situation

We have been working on a mortgage for a client in Stoney Creek which has been very complex and very time consuming. We have kept with it, trying different combinations to make it work for the client but the underlying situation is very very difficult. Our attitude is we will try to make it work on a best effort basis, it has been that demanding. Today it looks like it might come together and we are very glad for the client, who need a bit of good things to happen for a change. There are three lenders involved currently and there will be three after we re jig the situation but it is one lender in particular who has moved heaven and earth to make it happen for the client. It transcends dollars and cents and moves into............helping a client out and giving them hope. It is a very unusual thing for a lender to do and it is very impressive. We should sign the client up Wednesday night around 7.00 and hopefully the mortgage will close within 10 days. The mortgage may well be a record setter for difficulty. When it closes, if it closes, everyone will celebrate big time.

Posted: Tuesday, Feb 05, 2008

"Maxed Out" DVD Independent Documentary on debt and credit cards

This U.S. Documentary from 2005.

This is an independent movie, award winning which is both informative and funny. It is on the U.S. in the year 2005 and even 2 years prior to the melt down this showed warning signs of danger. Will try summarize the main points. -people buy bigger homes with idea of interest rates staying low and prices continuing to rise -they show 1950's archive movies of how credit used to be viewed. -many Americans have fascination with rich and famous -saving is the right way but not many do it, many feel "entitled" -4 billion credit cards offers are made to U.S. public per year -consumer lending is GROSSLY profitable. Especially credit cards. -average U.S. household held 9205.00 in credit card debt and pays 1300.00 per year interest -if your late on paying card they use as excuse to hike rate -bankruptcy law written by MBNA credit card company -people think buying "stuff" will make them happy -people experience job loss, illness, divorce, gambling etc and when this happens some of the largest corporations in U.S. and there to service the problem -Providian was fined 400,000,000 for fraud and yet Bush appoints ethics czar from same company -banks now becoming "sales culture" as opposed to prior "bank culture" -credit cards and subprime were very profitable (before the crash) -if there is a problem with payment on a card they pile on fees and charges and really jack it to the max -debtoutlet.com is a good source for information -debt collectors are ruthless, relentless and harrass clients, sometimes resulting in suicides -pawn shops, cheque cashing servivces and payday loans growth are a symptom of a growing problem -many large U.S. corporations get a lot of profit from low income and vulnerable clients -misrepresentation by broker and lender in cases -easy money when your in bind, you don't ask questions -equates slavery with sharecropping as unfair debt system and they equate that to taking advantage of poor in U.S. -in 2004 30 U.S. sued lenders for predatory lending and U.S. government came to aid of banks -credit cards given out at colleges and Universities can hurt those who don't use them right. (If used right you can use it as a tool to make yourself stronger) -University of Texas student commits suicide, gets 12 credit cards and cannot make payments and cannot afford bankruptcy fees and kills himself. -1972 there was tough income and credit requirements for credit cards, now much less -3 "C"s of credit are Character: which is trustworthiness Capacity: ability to pay Capital: ability to save -three major credit information companies are Equifax, Trans Union and Experian -FICO or BEACON score is everything. Algorithims are secret. -Inaccuracy rate of 90% (In defense of credit information gatherers, it has been our experience that by and large information is accurate. Sometimes errors are made and can be corrected. Many times a client may be emotional or angry about a score or item and they direct that anger at Equifax but it is really themselves that the anger should be aimed. A legitimate question or problem that clients have is IF they have something incorrect on bureau, getting it corrected is almost impossible and is akin to dealing with City Hall) But credit info is generally good and oxygen of entire system.) -between 1994 and 2004 10,000,000 Americans declare bankruptcy -family of four 1972 compared to family of four today, family today is poorer and can have trouble providing basics -no good answers to resolving the problem, it is that big -George Bush's top campaign contributor was MBNA credit cards -April 2005 Speech of Bankruptcy bill. Makes it tougher to re start. Bill punishes people. Written by MBNA. Senator Orrin Hatch (R) from Utah said "we feel badly about it and hope that they will forgive us" -average American family has 90,000 in debt -U.S. government reckless spending and raiding social security trust fund -U.S. government spends more on interest for debt than homeland security, education and healthcare combined. -financial stress increases suicide rate. Death comes as relief. -rich getting richer -life of great struggle, anxiety and vulnerability

FAIR MORTGAGE POSSIBLE SOLUTION: Live within your means, save, don't reply on material goods to make you happy, rely on friends and family. It is a world of "STUFF" and that is easy said that done but living within your means can me less stress and more happiness.

Posted: Friday, Feb 01, 2008

Client Given Bad Advice

A client came in last night. He has good steady income and a home worth 280,000 He can afford a mortgage of about 165,000 yet the current mortgage is 230,000 and that is at 11% on the entire amount! His payments are almost double what they should be. A more common occurance these days is that a client may take out a high interest loan, a small loan and this is turned around by some lenders into an entire new mortgage at a very high rate. The marketing is effective but the emotional wreckage is substantial. As a general rule, we all know that if a persons TDSR is 0-40% they should be able to manage there home, if it is 40-45% they are under severe strain. This client last night is coming in at close to 70%. This means that when the mortgage was arranged, the person arranging it would almost surely know that the client would be stressed and fail and hit with misery. But the person arranging the mortgage was compensated abnormally well so they will ignore the long term ethics and go for the short term money. Client last night is a good person but his whole life is effected. We see it all the time where a client has to make a decision, sometimes to downsize to something can afford. It is not always an easy thing and sometimes clients get upset but it is like a doctor diagnosing a situation and letting the patient know the reality. The U.S. based bank that got the mortgage for the client last night, may not have been looking at the bigger picture. We have said for a long time that Canada is by and large different and it is, it is better, but some situations seep through the cracks. The client is victimized and the person who perpetrated it moves on and perhaps never sees the client again. It is sad to see a person brought this low.

Posted: Friday, Feb 01, 2008

Interest Rate Negotiations

A client called today who wanted a very very low rate. We have the ability for give and take and are able to get the client the product he wants at a very low rate. There is always a little back and forth with us on rates and there is movement within the banks themselves on rates.

Posted: Monday, Jan 28, 2008

Sub-Prime Misconceptions

Every night there are news articles out of the U.S. regarding the sub-prime crisis and the implications world wide on the individual and the financial system. The points that are mentioned about lender greed, broker greed and very poor underwriting are correct for the U.S. and have damaged the whole U.S. economy. Does this mean a sub prime mortgage is no good? No. A sub prime mortgage can be extremely useful and is a vital tool in the mortgage arsenal. Many clients may go thru divorce, job loss, illness or invest in a small business and it doesn't work, there are quite a few major, common things which may cause the credit bureau to decrease. The fact that there is a lender with a product priced to risk for this client is invaluable. In Canada the economy has done well and to the credit of the major lenders, the underwriting criteria have been strong. The most sub-prime of the sub-prime lenders in this country has accepted self declarations for self employed clients but they have always stressed, "is this good for the client, can the client manage?" There are 3 major points which I think the U.S. has been different from us: (1) The lenders in Canada have fairly rigid underwriting, they know that if the client goes south that it will be a short term gain but long run, it is very bad strategy. (2) The brokers in Canada have been a bit more mixed. In general, our attitude is strongly that if the client won't do well from it, it is not worth doing. Not everyone agrees with this in the broker community. Sometimes we suggest a temporary mortgage to alleviate the problem while the client sorts things out, but to get a mortgage for a client knowing that the client cannot handle is immoral. (3) When the mortgages have been bundled off and sold in the U.S. it is apparent that there was no regard for the buyer, greed injected itself and making money became the overiding issue, short term gain, not long term well being became the name of the game. Thank god we live in Canada. It is financially stable and as much as it is popular to pick on lenders they have held things to a high level, which benefits us all and keeps the system strong.

Posted: Monday, Jan 28, 2008

The Full Monty

Today, Ben, Robert, Patrick and Graeme did the Full Monty routine, for a good cause. The staff at the Celidiagh House were good enough to let us use the upstairs room and we were videotaped. It was hilarious. We should have had a beer before we did the routine, we ended up having one after. Did a few takes, different moves. Had the police uniforms, whole nine yards. The edited product should be hilarious. The cameraman was from Australian and he felt it was one of the funniest things he has ever seen. We had 3 songs lined up but went with Tom Jones rendition of "keep your hat on" which was the last song in the movie the Full Monty. Should be interesting! We are debating if it is Youtube grade!

Posted: Monday, Jan 21, 2008

Thailand Resume

We just received a resume from a banker in Bankok Thailand who wishes to apply here. The world is getting smaller with the internet. Interesting.

Posted: Thursday, Jan 17, 2008

Sub Prime/U.S.

The news continues to be bad. Citi and CIBC have both taken large losses. The news out of the U.S. continues to be bad. In March of 2008 is the peak for the ARM rollovers and that could be one of the worst periods. The Canadian banks and the Canadian economy have been that much better, that much more stable than the U.S. It is a real shame that we are being tarred with that brush. Canadian underwriting has never been nearly as loose or reckless as the U.S. and we deserve better. It is interesting that at CIBC they would give a teller hell for loosing $ 5.00 yet they can lose money by the billions in bad judgement by senior management and somehow that is okay. They will probably end up with nice packages.

Posted: Tuesday, Jan 15, 2008

Credit Inquiry

Credit inquiries, especially numerous inquiries can be self defeating. It is expected that clients will shop around for rates and may get 3-6 successive bureau hits in a row. When a client has some credit problem, whatever it may be, they may seek an answer and keep on trying again and again with different brokers, banks and lenders and this can lower your score dramatically. If you have a credit issue, it is good to call us, the one stop shop and we will give you a summary of where you stand and what you can do to change the situation. What you can do to improve the situation. To keep inquiring is like bashing your head against the wall. It can result in heartache. Getting a good concise answer is worth its wait in gold.

Posted: Tuesday, Jan 15, 2008

BDO Dunwoody

BDO Dunwoody are putting a coast to coast advertisement about the services they offer. They have been kind enough to include one of our quotes in the full page colour ad. We appreciate it very much. We both have similar takes on the client, the goal is doing the best thing and providing the best solution for the client to resolve. At the heart of it, we all are seeking the same thing. For the client to do very well and be treated in a very professional way.

Posted: Saturday, Jan 12, 2008

Cookies

A lady in Stoney Creek was kind enough to bring us cookies and pastries. We had done mortgage for her 1 year ago and she had recent serious problems of a marital nature. She was pretty upset but we just gave her some good advice generally, it allowed her to step back a bit and look at things in a different way. It was a very kind thing to do.

Posted: Saturday, Jan 12, 2008

Lucky Fool

There is a great quote in the book, "Traders, Guns and Money" (which is a hilarious view of the world of derivatives) by Satyajit Das. The book is not dry, it is very, very funny. Very informative. A good quote in it is "it is better to be a lucky fool than an unlucky genius." How true. A lot of chuckles over that one.

Posted: Monday, Jan 07, 2008

Expansion Opportunities

We have had a great 2007 and are looking to expand in 2008. The opportunities are here in Hamilton and a new office in the Oakville-Mississauga corridor. Contact us if you would like to join us. It will be fun.

Posted: Monday, Jan 07, 2008

Thank You

Our team thanks our clients, lenders, referral sources for your patronage during 2007. We owe a great deal to you and we are very grateful. What we have done has been with your support.

Best wishes for the year 2008.

Posted: Thursday, Dec 27, 2007

Extraordinary Year: 2007

We have had a very good year. Some wonderful events have happened: -each of us have won sales leader for the months -company is sound and growing -we set up second company -we were first company to do Moneyconnects first mortgage and got a plaque from Moe Forget personally -we had an article in CMP magazine -we did subprime conference in Toronto and explained our approach to clients and lenders -Graeme became editorial member of CMP -we became finalists in a coast to coast vote by our peers for Independent Broker of the year, non franchise and for Sub-prime broker of the year

We end the year much stronger than we started off and the possiblities for the future are now manifold. We all did a great job and we should be proud. There is a feeling that 2008 will be even better. Should be interesting.

Posted: Monday, Dec 24, 2007

First National

A client had very stable income but went through a credit glitch a few years ago. This was combined with the fact that it was a private, non arms length estate sale to add to it. We got approval with First National and they gave they client an excellent rate right from the start. The rate was suitable for a person with perfect income and perfect credit. There were a few challenges to overcome and the botton line from First National was "does it make common sense?" It did a client feels like a million dollars. Clients are excellent, they experienced one temporary problem but now are on track.

Posted: Sunday, Dec 23, 2007

Mortgage Fraud/Toronto Star

December 22nd, 2007 page A1. A good article on mortgage fraud. Landmark ruling. A 90 year old man's home was sold in 2005 without his knowledge by criminals that made up a false power of attourney for him. The mortgage was taken out in the amount of 300,000 and the mortgage holder was HSBC who state they were misled by the people who commited the fraud. The court case took a large toll on the gentleman it was prolonged. The decision by the Ontario Superior court was the first of its kind. The decision found that even a bona fide purchaser can't legally buy a property from a fraudster. The decision found the 300,000 mortgage obtained by the purchasers was invalid. The basis for the transaction was a fake power of attourney document forged by the criminals. HSBC lawyers argued unsuccessfully. They said the mortgage was above board and valid. The bank should have ensured there was a valid power of attourney. They should have done more due dilligence.

Lenders in general have been very wary of power of attourney docuements. When power of attourney is present there is a very high correlation of fraud. I think this is the first time a bank has been found to be on the hook for this problem. It will mean the lenders will tighten up again agaist POA docs.

Posted: Saturday, Dec 22, 2007

Fair Mortgage Solutions: Finalists!

Today we were told that we had become finalists for Canadian Mortgage Professional magazines:

(1) Independent mortgage broker of the year for Canada. (2) Subprime mortgage broker of the year for Canada.

The gala awards will be held February 29th. You are nominated by your peers coast to coast and we are very honored and very shocked. To us it is a very big event. We don't know what to say. Everyone working together has made it all come about. We are all very proud of what we have done.

Posted: Friday, Dec 07, 2007

Rentals with Numbered Company

You can buy a rental with a numbered company. There are a few good options which provide good LTV and excellent rates. Credit and income must both be good. We require fairly minimal information. This program applies to both purchases and refinance.

Posted: Friday, Dec 07, 2007

Insurance: Title Insurance CMP Magazine/November 2007

This is obtain through your lawyer. Most lawyers recommend it. It costs between 200-300. The amount of real estate fraud is on the increase and this helps protect you. It protects against real estate fraud, defects in title of a property and errors and ommissions. It can eliminate the need for a survey and speeds up the closing process. Some lenders insist on title insurance as an extra measure of protection. It is a good product and everyone gains.

Posted: Wednesday, Dec 05, 2007

Insurance: Creditor Life CMP Magazine/November 2007

Creditor life insurance applies should you die or become disabled. It is insurance that is paid by the client so that the mortgage is paid off in the eventuality that the client passes away. It is usually a fixed payment amount on a declining mortgage balance. A mortgage broker can provide creditor life insurance to clients but not term or whole life policies. Creditor life can protect you against critical illness, diability and death. A bottom line is that no matter what route, a client should be covered for insurance in case something happens.

Posted: Wednesday, Dec 05, 2007

Insurance: Mortgage Default CMP Magazine/November 2007

This can be CMHC or Genworth or AIG or several others that have just joined. When a client puts down less than 20% it is considered a high ratio mortgage or high risk and the lender gets the above to insure the mortgage so that if the client default, the insurer (CMHC for example) cover the bank for the cost. This insurance is paid by the client for the benefit of the lender. Some lenders have their own brand of insurance, they self insure and it is somewhat less competitive. Mortgage default insurance is normal and straightforward. The choice of which insurer is used is technically up to the bank involved.

Posted: Wednesday, Dec 05, 2007

TDSR requirements and GE story

The TDSR is a measure of the cost of your home plus the cost of your credit bureau debts such as loans, leases, lines of credit, credit cards etc. In general, 40% of your gross combined income or less, should go to pay these items. It is an easy equation to figure out. If your ratios go between 40-45% that is a little bit more stress but doable. If above 45% that gets alarming. We had a client a few months back where they required a solution. We gave them a solution of a GE Money refi that takes the existing mortgage and most of the debts and makes things very affordable. We got the TDSR coming in at 41-42% where it was 58% currently. The client said this was good and we went ahead. GE was an excellent option. Client then consulted someone and they came back and said they wanted a private second mortgage to eliminate 1 debt which was bothering them. We said that it was no problem to do that but it did not make sense. The key aspect was to get affordability in line. By eliminating one debt with a second mortgage and leaving the other debt the TDSR was about 58%. Client insisted on this route and we explained that if the client were to sell the home quickly, a second might be route to go but that if they wanted long term peace of mind, that the GE route was the way to go. Client went with the second and then we found out yesterday that she was redoing the whole mortgage. The lender that was chosen was vastly more expensive than GE. The problem may have been that the client believed our advice on the first mortgage was not as good as what she had been told, she went her own way and in our view she protracted the situation and cost a lot of money and time for herself. She ended up going a route that was not what we would think is appropriate.

Posted: Thursday, Nov 22, 2007

Bridging

A client required a bridge loan recently. Between selling their current home in South Western Ontario and buying their new home in the area, the amount being put down was about 7.5%. Some banks require a mimimum 10% to bridge but the bank involved here looked at the overall profile and said not a problem. Most of the bridges we have done involve a fair bit of equity but this was one where the client choose to put down 7.5% and use the balance for their own purpose. Client exceptional and bank recognized that.

Posted: Thursday, Nov 22, 2007

The Framed Picture

A lender was kind enough to give us a framed enlarged blow up of a magazine article. It is "BIG" very big. We placed it in the board room/signing area at the end. Funny enough the client feedback has been extremely good, it makes them feel confident about our abilities. Thank you Moe and Moneyconnect.

p.s. November 22nd, the feedback by clients and bank managers on picture is universally positive. We are gradually "getting over" it's size and our modesty.

Posted: Saturday, Nov 10, 2007

The Passionate Eye - A Must Read

October 29th, 2007 Passionate Eye documentary made by Australian TV. This was fascinating. Have put down rough notes on the content then a comment on a few things from our perspective at the end. This can be viewed by going on You Tube.

"MORTGAGE MELTDOWN"

The subprime crisis in U.S. Almost anyone could borrow money. Crisis is just beginning. U.S. auctions on foreclosed houses getting 30-40% less than prior value. Value drop in U.S. largest since 1941, WWII. Two million Amercians will lose their homes because of this crisis. Subprime problems in U.S. have caused panic in world wide markets. A worldwide recession in now threatening. Biggest credit crisis since 1929. Homeowners in U.S. felt their home was sure thing, a good gamble. Many homes doubled in value. A ton of money made by realtors, lenders, brokers and lawyers. Professor from Yale predicted Dot com bubble and predicted mortgage crisis 3 years before it hit. States that problem stems for 9-11, Federal reserve cut rates encouraging lenders to lend and it was cheap money. Even clients scoring a low as 500-525 were granted mortgages. Lenders encouraged clients to refinance and pay credit cards, take vacations or do home improvements, unlock the equity in your home (today in Canada we still hear radio ads appealing to this, it is a totally amoral thing to do because your appealing to materialism and greed that will end up hurting the client badly). Subprime is defined as not top quality, bruised credit. Rates to 16% NINJA LOAN: No income, no job no assets required. LIAR LOAN: A piggyback 100% mortgage based on someone lying to get it. Cleveland Ohio now foreclosure capital of U.S. a tidal wave of foreclosures. 10,000 vacancies and power of sale up 300% TICKING TIME BOMB: ARM mortgage or adjustable rate mortgage. Low intro teaser rate for 2-3 years then you get hit with huge rate increase in 2nd half of mortgage. 2 million of these mortgages are converting soon. Some go from 8% (which is high by our standards to 13%) Many brokers and lenders did not explain. These subprime mortgage parcelled up and sold on Wall Street via hedge funds. Everyone collected fat fees. Mr. Satyajit Das gave a good perspective on whole thing. He wrote "Traders, Guns and Money" 85% of world capital flow is Europe, Middle East and Far East flowing into U.S. and heavily into mortgages therefore a problem with U.S. mortgage market will effect worldwide. August 2007 was first mortgage shock to markets. Credit described as lubricant, like oil, an engine needs oil or it will seize and that it what we have in some markets. Could effect GDP growth, unemployment and the whole economy. Long term might have dramatic effect on how we spend money, if last number of years was artificial we might have to adjust to new reality. Started with a Bear Stearns hedge fund, fund found to have lost 6% then 23% then it vaporized. Caused cascading action with all funds. Big sell off in August. Many billions lost. With Hedge funds the risk was diffused. With normal lending you have the bank lending to the client. Banks are strong, transparent and regulated. Hedge funds are unregulated, not transparent and hidden. By wrapping mortgages and selling in this market the problems were hidden from view. Predatory lending mentioned. They should also mention predatory brokers which go hand in hand. Clients felt scammed and cheated and misled. African Amercians 5x more likely to be victimized. Brokers would get higher pay to route a mortgage to subprime. Brokers incented to defraud clients. American capitalism. A peak in ARM rollovers is September 2007 but the biggest peak is March of 2008 and that whole time frame when many come due. Wall Street armed predatory lenders with money. The massive spending spree which fueled U.S. economy may be in reverse now. U.S. is 25% of world economy. It all boils down to greed and fear.

Our take on it. The undewriting criteria has always remained strong. A broker may get higher pay for subprime but you position with the lender that is most appropriate. You get the client the best possible deal and give them advice on how to make the situation better. To get a person a mortgage when they cannot afford is hurting the client, the lender and yourself. It will blow up in your face. Our banks deserve credit for being strong, we may complain about bank profits but thank god they are strong and transparent. It is a shame that we get some fallout from this U.S. problem, it seems unfair. On the whole Canadians are well served by lenders and brokers. A worry is the amount of spending, it may be wiser for a client to budget and live within their means rather than use credit to create an artificial world. It artificial and painful.

This was a very interesting show that is for sure.

Posted: Tuesday, Oct 30, 2007

Irene Perri

We learned that Irene has passed away suddenly. Irene worked at Scotia Bank, the Golf Links branch in Ancaster. She was always a pleasure to deal with, very warm, very professional. Our sincerest condolences to her family on their loss. She was a very fine person. It comes like a bolt out of the blue. We are in shock.

Posted: Tuesday, Oct 30, 2007

Realtor Ethics

A few weeks back we got a call from a realtor. He said that he heard we had a good reputation and wanted to come down and meet. We did and it went well, he thought we were professional and knew our stuff. He told us about a client he had where the client had dealt with another mortgage broker and it went badly and the broker couldn't get the job done. The realtor brought in the clients and they seemed like solid people, we got them three options to get the deal they wanted. The realtor and the clients were delighted. The realtor then asked if I could email the options to him. This was an unusual request but it also covered us off because it outlined everything. The realtor also said NOT to contact the client in any way which was very unusual, that really raised red flags. The realtor called Friday and said that an offer was made last week and they gave it to the other broker (presumably with our notes) and the other broker failed again. The realtor begged us 4 or 5 times to do the mortgage. We refused to do the mortgage on any grounds. Our thinking was the conduct of the realtor was beyond unethical after the long story he had given us. He chose to take a route that was unethical and unfair and the client suffered. By the realtor taking this approach, he will suffer in the long run. The three options we got were from lenders who know our relationships and knew our approach to helping clients, therefore they were willing to bend on a couple of issues. If another broker sent the mortgage in, the same might not be the case. We feel very used by this realtor. It would have been much better if we didn't know how badly he treated us. Ignorance would have been bliss. You live and learn but can't take it too much to heart. There are some people out there who do awful things but for every person who does that, there are many who do the opposite and restore your faith.

Posted: Sunday, Oct 28, 2007

CMHC Rental Change

CMHC are coming out with changes to the rental policy. The policy will now be quite different from Genworth or AIG. This is from a National Post article on Saturday October 28th. Article states that CMHC are going to allow people to buy their first, second or even third income property with no money down. Prior they requested 15% and Genworth needed 10%. CMHC may be moving into risky territory. In normal residential the risk can be pretty clearly outlined but in rentals, it is another beast. A person would much easier default on an income property rather than their own current home. The insurance fees are very high, so high that it is a big deal. The idea of doing a first and second prior was considered wise. It may look even better to have a small downpayment rather than go the CMHC rental route. There is a general pullback on the subprime side due to risk and yet at the same time CMHC are going full bore into this territory. An interesting comment was made at the end of the article. Benjamin Tal of CIBC World Markets says that the "genie is out of the bottle, this mortgage market is starting to move. Over the past 16 months we've seen more changes than the past 30 years." Incredibly true. From a mortgage specialist POV you don't know what will come next.

Posted: Sunday, Oct 28, 2007

Relentless U.S. News

The U.S. news is a non stop tale of woe. It is relentless and it is constant. It may be accurate but it has the unfair action of dampening real estate confidence in Canada. The latest is that the head of Merrill Lynch in New York has lost his job as CEO after losing 5 Billion + in bad lending. O'Neal if first prominent exec to lose his job but it is just part of the incessant drum beat of negativity. It is a great shame that this casts a pall on Canada and the world as a whole.

Posted: Sunday, Oct 28, 2007

Three for Three

Well we have had pretty good success in getting three good people, three good jobs. Maybe we should quit mortgages and become HR staff. All three people have outstanding skills but in this day and age, it can be hard to get work. We helped all three along and we are sure they will do fine. Each of them now owe us lunch!

Posted: Tuesday, Oct 23, 2007

Editiorial Board

Graeme has been asked to join the Editiorial Board of Canadian Mortgage Professional magazine.

Posted: Tuesday, Oct 23, 2007

Credit Errors

Credit errors can occur on your bureau. Both Equifax and TransCanada are good but we notice that "mixing" of bureaus can take place between father and son and mother and daughter. Even is DOB and SIN is totally different we have seen where they seem to merge them because they may have once lived together. It rarely occurs but does happen from time to time. Getting a copy of your bureau and reviewing for accuracy is important.

Posted: Monday, Oct 22, 2007

The Five Love Languages

Hey, we should be marraige counsellors. Another past client called this afternoon to ask about suggestions on tuning up a marriage. Our suggestion based on feedback we here is: The Five Love Languages by Dr. Gary Chapman. Website is www.fivelovelangages.com People say that the ideas can be used easily but they a first take people by surprise because they didn't know what they were not doing correctly. Also recommended a counsellor in Ancaster, Dr. Barrette who has also had amazing success with clients. 905 648-0360. Those two avenues were both very good suggestions to get things back on track.

Posted: Monday, Oct 22, 2007

Love Languages

A number of years ago we did a mortgage for a client through Scotia. Clients married a long time but they broke up and moved to apartments. Mrs. X called and explained that had seperated and this was about 7 months ago or so. We recommend a book called the 5 Love Languages which goes on to explain that couples can have 1 of 5 methods of communicating and to know the others love language is key to getting along. We recommend the book and last night did a pre-approval for BOTH of them, glad to see them together. Geez, mortgages and marriage counselling in one package. ha ha ha. Good to see them together.

Posted: Friday, Oct 19, 2007

Trusted Advice

We take it for granted sometimes, we give our clients the best possible solutions and list them in order of priority and their pros and cons. We can give suggestions and cut through all the lingo, just straightforward good advice that helps the client in the short term, medium term and long term.

Posted: Wednesday, Oct 17, 2007

Patrick

Patrick won the award for top performance in terms of sales and in terms of customer satisfaction for the month of September 2007. It was a stellar performance and he has done a lot for his clients and for all of us. He is a great person.

Posted: Wednesday, Oct 17, 2007

U.S. Mortgage

A client called to ask if we do U.S. mortgages. We don't. We have done 4-5 mortgages over the years for this client. The dollar is low and prices and depressed in Florida, our sense is that things will start to turn around once a new U.S. president is in place. There should be a surge of confidence. In the back of our minds is how the U.S. economy will perform and global warming, that is also an issue buying in a hot climate and close to the water.

Posted: Saturday, Oct 13, 2007

Helpful Advice

A client from seven years ago called for advice. We originally advised the client to go with a 5 year fixed, 25 amortization at fully discounted rate. A number of years into the mortgage they wished to refinance to pay some cards, we re did the mortgage, paid of the credit cards and re amortized for 15 years, their GDS/TDS were very low. They have subsquently knocked the stuffing out of the mortgage. They wish to know what else they can do to make things better and we are advising going with a Scotia STEP product which would give them the flexibility on going, that they need. They are doing text book well and we are very proud of them.

Posted: Saturday, Oct 13, 2007

Second Mortgage

A client asked me what a second mortgage and for a second I was taken aback, a second is a tool that is used in mortgages you don't give it a second thought. Here goes. A second mortgage is a mortgage put behind a first mortgage. For example, say a home worth 200,000. If you were buying this home you can arrange a mortgage of 75% or 150,000 and say you only have 15% down, then the gap of 10% or 20,000 can be arranged. Advantage is there is no CMHC fee involved, it is conventional and by using a second you can bypass the normal strict guidelines of income source and credit rating. A second gives you wide latitude. Downsize to a second can be that the interest rate is quite a bit higher but this is only on a sliver of the total amount. A big factor is whether a financial institution or a private lender will do it. If a private lender is involved the fees and expenses are usual quite a bit. Most of the seconds we do are for strategic purposes, there has to be logic to it. Seconds can also be used to refinance while preserving the first intact or as a defensive move. Seconds have a mixed reputation but the reality is they can serve an invaluable purpose. If a second is part of a good mortgage specialists tool chest, it is an invaluable asset. The concept of win-win-win really comes out, it must be readily apparent and understandable that it is a good way to go. Second mortgages have resulted in countless clients being helped out and can be invaluable. Most of the seconds we do are 1 year or open because they are designed to be closed out fairly quickly, they are not meant for long term use. If it long term then something has gone wrong.

Posted: Wednesday, Oct 10, 2007

More Subprime Woes

The subprime problems we have in Canada are a sideswipe from the U.S. Yesterday a major source of second mortgages to the brokerage community has halted activity. They are downsizing and pulling back. At the current momennt there is a void opening up between the prime market and subprime and private. Many are wondering how long it will last. Some say it is permanent, others say 3-6 months and it should correct itself. In Canada we have not had the wild policies that the U.S. has had, it is a shame that we are being effected.

Posted: Wednesday, Oct 03, 2007

Exciting Time

These are pretty interesting days for us. Things are growing and doing well. We owe you, our clients a large debt of gratitude. Any suggestions you have on making us better, would be most gratefully received. We thank you all.

Posted: Wednesday, Oct 03, 2007

Hooper Maneouver

Robert Hooper 289 237 0797 has invented a new way of doing mortgages. It is an innovative concept. The bottom line is getting things done, effectively and with high customer satisfaction. We have all tried it and it works well. Hat's off to Robert

Posted: Monday, Oct 01, 2007

Rate Drop

Rates have moved down .05% to 5.79-5.74 depending on lender. Underwriting criteria on "A" work if fairly stable but on equity and "B" work it has tightened in terms of LTV and rate.

Posted: Monday, Sep 24, 2007

Current Activity

Activity across the board is good, prime mortgages, subprime, equity, privates and seconds are all good. Many people say they are slow but we are keeping very busy and look posed to expand. The future looks good.

Posted: Thursday, Sep 20, 2007

Divergence

The U.S. market and Canadian market seem to be separating rather than operating in lock step. This is terrific for us, our economy is good, the fundamentals are there, we have the oil and resources, the unemployment rate is low and the financials are good. Our dollar continues to climb mainly because the US dollar is spiralling down. The fact that we are not quite joined at the hip with the U.S. is good because we don't want to get dragged down into there mess.

Posted: Thursday, Sep 20, 2007

Shakeout

The prime market continues well. The subprime lenders here in Canada seem to have a mixed result. Some have tightened up a bit, others have tightened up to the point of not doing any work and there are those that have pulled back entirely. Again, I think the Canadian market is different from the U.S. and it is a shame that we are sideswiped this way. The private lending market has taken a dramatic upturn filling the void that subprime lenders used to fill. Private lending will probably be strong until the normal subprime comes back and takes its place.

Posted: Thursday, Sep 20, 2007

Credit Re Bound

We have had quite a few clients lately who have followed our advice for credit re build and they have achieved dramatic results. The most dramatic being the fact that they now have tremendous flexibility and an ultra low mortgage payment. Ask us for our credit re build sheet.

Posted: Monday, Sep 10, 2007

1933 and F.D.R.

When FDR became president there was an immediate bank crisis, a bank run. It was national in scope and was serious. This was March of 1933. He got elected in November 1932 but back then they took office in March. FDR shut down the banks for a bank holiday of a week, he went on the radio and explained in simple terms what was happening, why and what the government was doing to do to rectify. People responded with calm to his voice over the radio, it made a huge difference. That crisis was much more serious than the one Americans face today. FDR closed the banks for a week then gradually opened up ones which were strong, ones which were weaker waited a bit and they eventually brought in FDIC deposit insurance to further give the public a vote of confidence. This annecdote stems out of a call with a lender yesterday. A key element is leadership, strong, truthful and confident. Again, situation in Canada is much better than US, you can't even compare the two but the lack of leadership or poor leadership at the top is not helping the US. They need to have confidence in their leaders and this may not come into play until November 2008. There could be a real surge at that point. It is a real shame that we are getting sidewiped from US problem which in some ways has turned into world wide problem. Hopefully it will end soon.

Posted: Wednesday, Aug 29, 2007

Debt Crisis tops terrorism as threat to U.S. growth

National Post For the first time since 9-11 attacks on New York and Washington, U.S. economists say terrorismis on longer No.1 threat to the economy. The subprime crisis is now the biggest worry. The meltdown in the US $2 trillion (with a "T")subprime mortgage has led to a bankruptcy of dozens of mortgage firms and is threatening to spill over into the broader economy as more and more homeowners face foreclosure.

Posted: Monday, Aug 27, 2007

Ripple Effect/U.S.A.

ABC News. The U.S. is getting worse. Sales of existing homes continues to drop and the price they are getting for those homes is likewise dropping. Prices have dropped for 12 straight months. Half the U.S. is experiencing price declines, worst situation since Great Depression of 1929. Many Americans refinanced on regular basis, taking equity out to fund credit cards and it has come full circle. While not as bad, the credit card situation here is not great. Many houses have higher mortgage than house is worth. Credit card splurge has helped economy but at what cost? Whole U.S. economy might be dragged down. Sharpest drop in consumer confidence in one week in over 20 years. 57% of Americans say economy getting worse.

Posted: Monday, Aug 27, 2007

Credit Trends

The Canadian market, clients and lenders all appear okay. Strong lenders are using the roiling in the market to their advantage, but quite a few others have tightened up on their lending criteria or halted activity altogether. The ABCP problem seems to be having a deep effect, some have said that they have tightened up and others have indictated that they may not be able to fund mortgages in 2-3 months. It appears that most of the large and strong lenders have still kept to the same critieria as before but the smaller, alternate lenders is where there have been quite a few changes. From our point of view, which is grass roots, we have not noticed anything dramatically different but the U.S. problems seem to be having a spillover effect. It is concerning because Canada is in a much better position.

Posted: Monday, Aug 27, 2007

Home Trust

A good article in the Toronto Star on saturday. It stated that the liquidity crisis in some portfolios was creating a buying opportunity and Home Capital was interested. Nick Kyprianou, SVP views it as an opportunity. The reason this was so positive is that Home Trust has always been viewed as smart, aggressive and tough. The fact that they see an opportunity in the mortgage market is very positive, very heartening. The article quotes Home Trust as taking a "retro" or conservative approach to the market, "It's a kind of a '60's way to finance things, but it is working for us." The Canadian market is different from the U.S. market and this is most apparent on mortgage underwriting criteria. Home Trust has been an equity lender who have always taken a common sense approach, they are very tough, no doubt about that but whenever they have done a mortgage with us they have always said "it is common sense for the client and common sense for us." Home Trust is the true definition of subprime, the fact that they view it as a buying opporunity is very positive. They are tough and smart and have a good track record. The article goes on to mention ABCP which Home Trust do not do. Not sure what this means for lenders who do.

Posted: Sunday, Aug 26, 2007

Ottawa Phone Call

We got a call from an assistant to a minister asking about the crisis in the submprime market, what was our take on it and how serious it was. We talked about the subprime conference and what was said there. The TSX has taken a large hit today and that was a worry. Again, the U.S. market has been plagued by: -greed of brokers and lenders -negative amortizations, long amortizations and interest only mortgages -qualifying a client on a variable teaser intro rate instead of the normal rate or the three year posted rate. -no money down mortgages for people with weak credit and self dec income which was fictitious. The Canadian banking system and even the subprime lenders have always excercised good discipline and even in the most wild situations they have always put common sense lending at the front. As much as we like to complain about the banks they have shown fairly good discipline. The onset of the subprime was maybe 6-8 months ago, what has been a big surprise is how the problem has migrated. Initially it was subprime and a minor concern then it grew then it affected prime market, commerical lending and the bond and equity markets and even the performance and profit of home depot and walmart. Canadian banking has always been strong and I "think" it remains so.

Posted: Thursday, Aug 16, 2007

Amazing Ben

A very unusual event happened this week, Ben set a record and we are all in awe. It was something else and we all take our hats off to him. He has given us a challenge we will all try to match. He did a phenomenal job on a challenge. He stuck with it and offered solutions and it ended up a pretty amazing story. We will all re double our efforts. You did super work. -the team

Posted: Thursday, Aug 16, 2007

Change of Course

There has been a lot of positive feedback in how we do our work and what our technical abilities are. It is pretty exiciting. We are on the right track. We will make the changes accordingly but it is fun, very fun. It says a lot for a small Hamilton company to be taken so seriously but everyone.

Posted: Tuesday, Aug 14, 2007

Credit Rebound

There have been a number of examples of huge rebounds in credit scores. A City of Hamilton work gained 160 points in 62 days flat, quite a remarkable feat. A couple in Burlington that we tacked on a second mortgage for 1 year, followed the advice and they rose from the mid 400's to the high 600's in 1 year. Very good work on there part.

Posted: Tuesday, Aug 14, 2007

The Toronto Conference

This conference went very well, held at the Westin Habour Castle. It was a subprime conference and we were asked to guest speak. We outlined our approach plus 4 success stories. There was good involvment by the audeince of questions and it was just a terrific experience. We got a fair bit of work from Toronto brokers in the following days.

It was very very good. Learned a lot. Learned how much we do is right and we are on the right track.

Posted: Tuesday, Aug 14, 2007

Success Stories

We are going to present 4 stories that happened within last few months which were pretty extraordinary and worked out well for both cleint and lender. Two stories involve banks and two involve private lenders. All four are very powerful stories.

Posted: Tuesday, Aug 07, 2007

Subprime Conference/Toronto

We have been asked to be guest speakers for the Toronto subprime mortgage conference this Thursday. It should be exciting and we are simply going to say how we deal with ALL mortgage clients, approach we take, advice we give. Should be a lot of fun.

Posted: Tuesday, Aug 07, 2007

U.S. Credit Problems

The U.S. subprime market continues to have problems. The underlying problem of weak lending criteria in the past is U.S. related and does not seem to be parallel in Canada. We have always had solid underwriting and common sense. In Nevada 1 out of 69 houses is in power of sale and across the U.S. since January there are over 570,000 power of sales. The fact that the subprime market was going sideways was a big concern but what is of greater concern is the impact on the stock market and other credit markets and general consumer confidence. Someone said that 1 in 4 mortgages in the U.S. was subprime. The problem in the U.S. does highlight the differences between the counntries. Again, Canada has always used common sense and is maintaining that position. Lenders that are U.S. owned are showing that since the U.S. has been "bitten" they are assuming Canada is the same way and they are abnormally tightening up. In the U.S. right now they are saying that you may have a challenge getting a mortgage even if your income and credit are perfect. The greed factor is biting them in the rear.

Posted: Tuesday, Aug 07, 2007

Administrator

We are looking for an admin person. Someone either full or part time. Someone with a good memory, diligent about following up on conditions. It would be preferrable to have someone who would like to stay long term. The environment is very friendly and very positive. We realize all the positive qualities that Jackie had and many times we miss that. Jackie is doing well and we wish her the best. Finding the right person is tough, it is hard to know who will work out. Send us your resume if you are interested. Our fax is 905 388 1737.

Posted: Monday, Jul 23, 2007

Transition

It is an exciting time at the company. We are undergoing a change. We are evolving. We are getting good feedback from clients and lenders. In the last few weeks we have hit on some fundamental new ideas which are currently being used, we will try them and see how it goes. The environment is fun and it is better to try and fail than not to try. We will give it a go!

We have had a number of mortgages that have made a deep impact but the latest Dunnville situation went very deep to all concerned.

Posted: Monday, Jul 23, 2007

Dunnville Story

This is a very emotional situation. Client was given very bad advice about 2 years ago. They were fairly clearly taken advantage of. Clients have a number of positives about their situation but they were made to feel bad, their self esteem was lowered. 3 months ago we gave them advice to combine their first and second mortgage together, they were surprised we charged no broker fee for this and gave them good advice. So far, so good. One of the clients suffered greatly from depression and handled the finances and was thus not able to act, the bank in question cancelled the mortgage application because of non response. We phoned client quite a few time and got no response. We then sent a letter to the effect that lender has cancelled mortgage application but it was good working with them and to follow our credit advice and they would do fine in the future. The client opened our letter, was emotional and was worried we would be angry with her. We then got a notice a few weeks later indicating one of the current lenders was going power of sale and they had 2 weeks to vacate. We phoned again, but did not hear back. One of our people, Robert, took it upon himself to go down because the situation was so unusual, effectively the clients were giving the house up the lender when they had so many positives, it seemed like a shame. We all were of the thought that nothing would come of that. When Robert went down the husband was not aware of the problems. The wife had some health issues which were effecting her ability to judge and this put them in a tough spot. Over the last week both clients and ourselves have sweated bullets because it has been so tough to get them out of the power dive into the ground. Today around 1.00 it got resolved with the help of a very prominent Hamiltonian president of a corporation. The clients were given help at the last minute from a lot of sources and they deserved it. We all said a prayer and it was a miracle it got done. We put a first and second mortgage in position but the legals kept adding up and our original figues were blown away. It seemed hopeless. If this situation can be fixed virtually any situation can be fixed. The key element to this is the sincerity of the clients and there many positives. We have advised they get a 1 year term which they have done and we will work with them to re build and really fly on their own by year end. Clients faced two major issues, being given bad advice and then the health issues, it was a double barrelled problem. I think both have a lot of guts. They have issues they have to overcome but they have stuck with it. The sherrif would have removed them Monday if the problem not fixed. It was a very emotional situation for all concerned. They have children. I think this might be the most difficult and most emotional mortgage we have ever done. It is Friday afternoon and we are in a pleasant state of shock. They would have lost the home without the intervention of the company president, no doubt about it. They owe a great deal to him. A number of excellent Hamilton lawyers fought to get this done and we owe them a tip of that hat.

Posted: Friday, Jul 20, 2007

Client with large cards

A client has very good income and equity in there home. The balances on credit cards are very high. We recommended preserving the first mortgage (as it is a very low rate) we will tack in a 2nd to payoff the cards then when the first renews the first and second can be rolled into one and they can reduce the amortization and payoff the house at the same schedule they originally had. Again, the only way it won't work out well is if the clients go and rack up the cards again.

Posted: Wednesday, Jun 20, 2007

Bomb Squad

We are located at Queen Street, near Hess Village. Robert and Graeme and an Steven (an AGF BDO) went for beers and were blocked from going back to work because there was reportedly a suspicious package in front of a hairdressers. The police were there, bomb squad, robot the whole thing. It was later found that the box contained makeup? And they blew it up. They X-rayed it at first and supposedly there were wires etc. It is hard to imagine an al-Qaeda attack down at Hess. It later made the channel 11 news at 6.00 p.m.

Posted: Wednesday, Jun 20, 2007

Toronto Conference

We have been asked to speak at a national mortgage conference in August at the Westin Habour Castle. It will focus on subprime lending and we will profile some examples of extraordinary service rendered by lenders to clients who have equally done well. The key is common sense. Everyone must gain and the client must have a roadmap to success.

Posted: Wednesday, Jun 20, 2007

CMP Magazine

We were profiled in CMP, Canada's independent mortgage trade magazine. The article was very good, it was headlined with "common sense lending" and mainly highlighted a deal done for Remax Toronto for a client who needed 95% financing. The mortgage was done through Moneyconnect, a relatively new lender which has just expanded to Montreal and Calgary. We wish them very well, they truly did an extraordinary job of customer service. It was one for the record books.

Posted: Wednesday, Jun 20, 2007

Rates

Rates are continuing to move. For a long time rates have been flat, say around the 5.10% for the 5 year fixed benchmark. They have currently risen to 5.79% and will probably rise again shortly. The Canadian dollar gaining strength is driving the rates higher. They anticipate dollar parity near year end and the rates may climb steady with that movement. It is good to lock in now while rates are lower.

Posted: Thursday, Jun 14, 2007

Rate Hikes

Rates have gone up twice back to back. The Canadian dollar is getting stronger and stronger against the U.S. dollar. When this occurs there is an excellent chance that rates will hike up. They hiked up to 5.45% (5 year fixed) and will probably to to 5.75% shortly.

Economics is very complex and many times it is hard to predict very accurately when/how much rates will move but the dollar weakening/strengthening is a good indicator.

Posted: Wednesday, May 30, 2007

Patrick

Patrick has been with us for close to one year and does an excellent job. The customer satisifcation surveys come in the highest for the group. We are proud that it is overall very high but for Patrick it is close to perfect.

The role he plays is invaluable. You name it and he can do it. You could not ask to work with a better person He is great. So is his advice!

Posted: Wednesday, May 30, 2007

Advertising

We are changing our advertising a bit. Less information and more graphics.

The volume of work we get from past clients and others is very high, we are doing this more as an experiment, just out of curiosity to see what happens.

Should be interesting.

Posted: Wednesday, May 30, 2007

Customer Service!

A client had a very unusual situation. They have a TD first mortgage which was in arrears. Because the lawyer may have mis-registered the home TD could not go or were delayed from going power of sale. The client went into arrears then the bank wished the whole thing be made good, which client couldn't do. The reason why they went into arrears is complex but the situation now is solid.

They were 24 months of arrears which was shocking but situation is fixable. We are preserving TD first, tacking in an open second then at a later date combining the two together to get the client one low payment.

Client amazed that their home is preserved.

Posted: Wednesday, May 30, 2007

Very Very Proud

We have had a wonderful week. Each and everyone of the team has put in incredible work and made us all very proud. Ben, Patrick, Robert and Olessia, you have all done great work. The pride extends not only to our people but companies and individuals who have provided help and expertise to us along the way, we owe them more than we can ever say. It has been a very good week. We may be small but we are very professional and putting the client first, makes for repeat business, makes the client happy, makes us sleep well at night and gives the lenders a high level of confidence.

Posted: Thursday, May 10, 2007

Busy Week

It has been a very very busy week. The volume of work has been surging and we are lucky we have the people to cope with it. It is coming in equal parts of new work and past clients, the volume of past client work is high and it is quite gratifying. Some lenders in particular have really done incredible work this week in providing a high level of customer service, TD Canada Trust and GE Money stick out along with HSBC. The customer satisfaction surveys continue to pour in and we are scoring 80-100% on all categories, the legal category is getting stronger. It is scoring 80% where before it was getting in the 60% range.

Posted: Thursday, May 10, 2007

IMBA Conference II

We attended the conference. What stood out fairly dramatically is for a small company, which Fair Mortgage is, we are held is pretty high regard both by lenders and competitors. IMBA is a great organization that is based more on the grassroots and helping the whole industry. Everything they do is focussed on helping the broker and the client and raising standards. We do not have that much contact with day to day but what we do is impressive. Before the company started in October 2005 we visited a very successful IMBA member to ask for advice/opinions. His name was Sham Kaushal and he was based in Toronto and what we found is he was very generous and giving off his time eventhough he did not know us. It was a very kind thing and it made a huge difference.

Posted: Saturday, May 05, 2007

GE Money continued

We arranged a mortgage for a client 2 months ago, this was on a previous blog. GE Money initially said no to the mortgage because the Beacon score was in the 490 range then dropped to 460 "BUT" there was logic behind the whole thing. You have to know the whole story behind the client and where they are going and why. GE Money took a calculated risk and it is paying off. The client is very solid and is OVERJOYED to the point he called Thursday to ask what his beacon score was and it had risen to 610 from 460 in 2 months. We had faith in him and we relayed that to GE who did a great thing. Another example of great service.

Posted: Saturday, May 05, 2007

Pinball Clemmons

Pinball Clemmons gave a good speech at the IMBA conference in Toronto. It was very interesting. It was based on trying to find a good solution for the client which would make the client and the mortgage agent very happy. A key message he had was too often people focus on "stuff" and they think that will bring them happiness when in reality it is an illusion. He also emphasized doing things the right way for the long term and being happy in your work. I think we at Fair Mortgage already do that so it dovetailed pretty well with what we are trying to do. I was not sure what kind of speech it would be, him be an ex-football player and not knowing too much about him but it was pretty spiritual. He has a great long term outlook on life.

Posted: Saturday, May 05, 2007

IMBA Conference I

The IMBA conference is taking place in Toronto this Thursday and Friday. It is the Independent Mortgage Brokers Association and it is excellent. Down to earth, broker foccused. Fairly inexpensive. Not elitist. The founders of this organization deserve to be praised, they do an excellent job. Before Fair Mortgage was formed we asked for help and advice and it came freely from members who in away, could be viewed as competitors but the attitude was helpful and very giving. It is a great organization and deserves to do very well. We are very proud to be associated with it.

Posted: Wednesday, May 02, 2007

West Mountain

A client has had a few big expenses come up, ranging from visiting relatives to unintended expenses. The credit score has gone a fair bit downwards but we have a good solution which will wrap up most of his credit cards, combined with the one mortgage to give him one low payment and his credit score will rise as his cashflow will be so strong.

Posted: Tuesday, May 01, 2007

The Farmer

One year ago we had a farmer, really an ex-farmer who was looking for a property in Hamilton. It was a very tough deal to put together, income was okay but credit was an issue. The only solution was a first and second mortgage. A primary purpose for the home was as a home for his daugther while at school. When he closed he was short of funds. We lent him what he needed, interest free. We don't make a practice of this but it was an exceptionally tough situation. He stood to lose a lot of if did not close. We helped him out and he said he was a farmer and as good as his word and it proved true, he gave us a series of post dated cheques and he is as good as his word, he was absolutely a stand up guy. He recently dropped by the office to thank us for the help and said it was much appreciated. We are going to offer him new financing as the credit rating will be better shortly.

Posted: Tuesday, May 01, 2007

U.S. Brokers

We have been getting a number of calls and emails from U.S. based brokers who are moving up here because the market back home is very slow. The subprime market problems in the states have really slowed their real estate market. Canada on the other hand is going great, volumes are good both on purchase and refinance.

Posted: Friday, Apr 27, 2007

Dunham Group

Dunham Group were the company that helped us with the website back in late 2005. We knew very little about what went into a website and there suggestions and expertise has been invaluable. We were experts in mortgages but not in websites. We were as green as green could be in this field.

A suggestion about putting a blog on of the activity of interesting stories was sort of viewed as...............we were not sure what to make of it, but it has proved invaluable in a number of ways we did not anticipate.

Our company is doing very well and if we continue to propser I think it you look back and point to one factor that helped was the suggestion of the blog. It really has helped in quite a few ways. They deserve a great deal of credit.

We owe Chris Grabiec and John Janisse a big sense of gratitude. They can be reached at 905 312-8444 and they do great work. They are professional and great to deal with us, just great.

Posted: Monday, Apr 23, 2007

Real Estate Market/Double Hump Pattern

The real estate market generally follows a pattern of two humps, it rises to a peek in March-April, gently slopes down to July and August then rises to another peek in September-October.

This is an approximate pattern of house buying. It does not necessarily mirror the mortgage market because people may refinance their mortgages at different times, it is possible therefore for the mortgage market to be busy while the housing market is slow.

A well known competitor of ours once said that he could not predict which would be a busy or slow month and there is quite a bit of truth in that.

Posted: Monday, Apr 23, 2007

Tiring Week

It has been a very busy week in the office and no end in sight. On Saturday morning we have to start at 8.00 a.m. to see clients. We have been getting very good feedback from both clients and lenders which we greatly appreciate. There is a strong sense that we need to expand to meet demand. We had a group photo taken in front of our sign this morning, it was the five of us. The most important thing that happened this week was getting a pat on a back from a legendary figure in the mortgage business. It meant a great deal. We have also emphasized that we are trying to do something different, a different way of transacting mortgages. It has been a tough and tiring week and we all did good work.

Posted: Friday, Apr 20, 2007

Money Connect and Moe Forget

We were honoured today with three members of Money Connecting coming down for lunch. We were presented with a plaque stating that the first mortgage that was funded by Money Connect was provided by Fair Mortgage Solutions in December of 2006.

The seven of us went for lunch and we very pleased to talk with Moe about what Money Connect was doing and the concept. The level of service and common sense approach has been excellent. No two ways about it. Moe is a legendary figure in mortgages and it was a real treat to meet him, Laurie and Urmula.

We got a call from Money Connect the same time a client in Toronto needed a mortgage, this was back in December. We obtained the verbal approval very fast, within half an hour then Money Connect followed up quickly we had a commitment. What was shocking was not just the speed and accuracy but the fact that they were not funding until January 1st, 2007 so it would have been very easy for them to say we cannot do it. Instead, they bent over backwards to provide a unique level of customer service. The mortgage amount was around 120,000 but what they did was above and beyond the call of duty and it seen to rarely these days. It was a unique experience for the client, us and Money Connect.

We had lunch at Slainte. It was very enjoyable. Again, the Irish beer is said to make you live long. I think our philosophies on mortgages and lending are similar.

Posted: Thursday, Apr 19, 2007

Funny

We went to visit a client for a preapproval and analysis of the situation because it was not a cookie cutter type mortgage.

So, we head out and Robert has the GPS navigator and we type in the address and get to the QEW and Victoria road (near Jordan) and head south then it indicates we have a LONG trip ahead still. We drive and drive through rural country, no end in sight, we get pretty close to lake Erie. It is drizzling rain, an awful day. We have a hard time finding the house and phoned the client. The property was way out in the sticks on a gravel road. We find the house and there is a fairly long driveway, four big dogs came out to surround the car and we were worried about getting our "privates" bitten and then finally I get out of the car, the dogs sniff me and a big one jumps in the car and Robert told me as a small child he was attacked big a dog. (it was serious). We edge up to the front door, surrounded by the dogs, the owner who is a great guy sat down with us and we toured the house. One room was getting repainted white and Robert was wearing a black jacket and the white paint smeared on his new jacket. We both were wearing new shoes and they got muddy and wet by the time we were finished visiting the barn.

The client situation is involved, it is not straight forward but a solution I think can be achieved. The client was a super guy and we had a good time and it was funny. We won't ever forget it. Robert said that going that far to give advice was a sign of real dedication. The property is very nice but he has made it unique. The challenge is to find a lender who wishes to fund the mortgage.

The average preapproval is probably 40 minutes. This ended up being 4 hours and the cell coverage was poor.

Robert wants a new jacket so we have to fund this. We stopped for a beer in Dunnville to consider our day.

Without a personal visit the mortgage would not get done. With a personal visit the odds are pretty good that we can do it.

Posted: Tuesday, Apr 17, 2007

Stoney Creek Refinance

A family came to us about six weeks ago asking for advice on a refinance. We gave them a few different options. They choose to use another broker. The broker arranged a second mortgage but the clients were extremely dissatisfied. They came back to us and when asked why they went elsewhere they didn't say anything. They just asked that we fix the situation. We then suggested taking the first mortgage, the second mortgage that was recently arranged and 1 large loan and giving them advice so that they can get a first mortgage to resolve all the issues right now and when the dad starts working (he was laid off) they can get a new first at a little bit better rate, although the current rate we quoted is very good. They were very happy with the outcome.

Posted: Saturday, Apr 14, 2007

Client Comments

April 9, 2007

Just had to drop you a line to let you know how much I appreciate everything you've done for us. Being financially burdened for over five years with two mortgages, one of which was at at absurd interest rate and awaiting a bankruptcy discharge, we thought the day would never come. We were starting to give up hope.

As well as the issues of me being self employed just created more doubt for us. But you gave us hope and stuck with us through the whole process. You are a credit to your industry. When all was finally in place it took only four days to close the deal. I left the lawyers office feeling like such a weight had been lifted from me. My family and I feel that we didn't just refinance a mortgage but made a true friend. Any and all future mortgage decisions will be managed by you with 100% trust and confidence. You are a true professional.

Thanks so much, Dwayne and Helen.

Thanks Mike Rubenstein for the great legal work.

Posted: Tuesday, Apr 10, 2007

Two Grateful Clients

We have two great clients that we did mortgages for and did a good job. One is coming over for dinner, they were just so happy that they got there refinance and everything went well. They are bringing there young kids, which is great. The other clients are so happy that they have allowed us to use there cottage for a week up north in Haliburton. It is very kind of them. Checked out the site on line and it looks wonderful.

Won't have to book a vacation this year.

Posted: Monday, Apr 09, 2007

Big Thank You - Beach Blvd

A couple needed a mortgage refinance that involved resolving a fair number of issues at once, it also involved patience on there part and ours because they had to wait for 6 months for documentation. It finally came last Monday and they closed there mortgage on Thursday. They were kind enough to leave one of the kindest voicemails we have ever received. It means a great deal to us.

Posted: Monday, Apr 09, 2007

Thank You

A grateful client brought us in a bottle of Irish Whisky and a kind thank you card. They required a sequence of three mortgages in order to provide them with what they needed. It was complex to arrange but the client is very very grateful that it could get done. We appreciate the thought, it was very kind.

Posted: Wednesday, Apr 04, 2007

Calgary Appraisal

We had a problem where we did a mortgage for a client in Calgary, they stated that they would pay the appraisal, we gave them the location and amount and the client closed the mortgage but then chose to not pay the bill. Our agent involved has taken a very high road and offered to split the cost with the client and did so. We all admire this approach and it is the right way to go. It is up to the client to pay the other half of the appraisal but our agent did the right thing for sure. We will check up from time to time on whether the client did pay. In many cases the lender may pay for the appraisal, in this case it was a mortgage which was difficult to arrange and the lender does not pay when it fits into a niche type market.

Posted: Monday, Apr 02, 2007

40 year amortizations

40 year amortizations are becoming more common place. It can be a useful tool but it has to be weighed up in the total package. If possible an amortization of 25 years or less means that you pay off that mortgage quickly. A 40 year amortization can be useful but you must be careful about using it.

Posted: Monday, Apr 02, 2007

Accounts Payable Policy

We have this policy, or philosophy, which has worked out really well. We are a small and entrepreneurial company and we appreciate being paid promptly by the banks and likewise, we pay out bills very quickly.

It is an important thing to us, all of our suppliers, all of our partners get paid quickly. We generally pay all bills within a day or two of receiving the bills.

Because we have this policy we in turn get really good treatment from our partners. They give us priority because we pay so promptly.

We have always been this way and it is a very strong issue to us. Always will be.

Posted: Friday, Mar 23, 2007

Canadian Subprime Market

There is an article in todays National Post. It talks about the huge subprime problems in the U.S. but states the Canadian real estate market is growing by 10% and our default rate is 0.5%. The default rate on subprime is 5% for Canada vs 20% for the U.S. Our underwriting is prudent. The Canadian market is strong and much different (thank the lord) than the U.S. The U.S. has borrower friendly laws vs Canada which has lender friendly laws. It could be a good think if the government enforced standard subprime rules on lenders. This would ultimately help Canadians as a whole. Again, the requirements of our Canadian lenders are good, I think some changes might be a good thing. Going parallel to the U.S. would not be a good move. The U.S. congress is considering this and we always seem to play catch up. We could lead from strength, it is already a good banking system, stable and we should make it stronger and help Canadians at the same time. All the stories out of the U.S. are a worry. It makes me glad we are up here and I don't know how they manage.

Posted: Friday, Mar 16, 2007

Going Small and Strong

This is a bit of advice we have given out quite a bit lately. We have had a number of people talk about downsizing. Doing this could be a very very good thing. It helps on finances by making it more affordable and decreases the stress while increasing your quality of life. The difficulty to overcome, and it is fairly big, is psychological. Some people want to hang on to there home, maybe a large home, no matter what. This is bad. It is must better to go small and strong and not be bled to death by living an artificial and eventually, an unhappy lifestyle. We had a good past client, terrific guy, wants to downsize into a mortgage maybe 60% of original amount, by doing this he may find that it makes a huge difference in the quality of his life. A major problem we all have is commercials and being drive towards materialistic good, which does not give real happiness but just the illusion of it. Small and Strong and Happy: It is the way to go!

Posted: Friday, Mar 16, 2007

Hamilton Market

This is a generalization, just an opinion. The market seems fairly good and house prices relative to Burlington-Oakville-Toronto are very good. The only area Hamilton really falls down on is the property tax, it is abnormally high compared to almost everyone. The quality of life is very good here. You can buy a nice house here and live well and have your kids live well. Hamilton is great. The trend recently is for a lot of refinances. We offer the client as tactical refi which kills to birds with one stone. There has also been an increase demand for second mortgages, to tack onto existing first and pay debt while not payinhg CMHC or the penalty to get a new first. The volume of second mortgages has gone up dramatically, no doubt about it. Knowing Canada is relatively conservative compared with the U.S. for example, it makes me wonder what the U.S. is going through.

Posted: Friday, Mar 16, 2007

Why a problem?

There have been a few mortgages through this week which present a problem. What does it mean when someone's income is very high, there credit score is impacted but the cashflow should be good, yet is not? Some examples that have stood out are clients that can literally afford a mortgage double the size they have. Yet, they may be missing mortgages payments or defaulting entirely. These clients may have no short term debt or large short term debt. The one factor is that no matter what they have, on paper they should be able to manage. This is a hell of a problem for us, what do you say? What do you do? What do you advice? Do you ask personal and potentially embarrasing questions? Is it our business? It is tough. We generally give the client a roadmap to resolve the problems but if the underlying problem is...................tough to deal with...........it is hard, very hard to resolve. We are mentioning it because it seems to be getting more and more common.

Posted: Thursday, Mar 15, 2007

No Money Down and 100% LTV Refinance

There are now a number of products for a person buying a home and having no money down. There are a few tiers of lending, based primarily on credit score and source of income. In general, the income must be very stable. If the credit is very good there are two primary lenders who offer a good deal on purchases. If credit is a little impacted there is a series of lender who can do it and generally offer rates tied to credit scores. The amortization range from 25 to 40 years. A client also has major options on refinancing the home to 100% of the value either by way of a first mortgage or tacking on a second mortgage. Again, income is key and the credit rating must be quite good. The lender requirements for above are fairly stringent and the house appraisal if required, is vital.

Posted: Thursday, Mar 15, 2007

Micro Seconds

In the last week we have done three micro seconds or small seconds. Each one is designed to resolve a client out of a problem. They are done with the intention of being short term and getting the client on track and rolling the first and second mortgage together in one unit. In each case there must be a good strategy for the client and the lender. We counsel the client heavily and most times it works. If the client has an underlying problem they cannot resolve then whatever we say or advise may be in vain. It is difficult to know the truth of the situation. Occasionally you can advise a client until the cows come home and what you say makes perfect sense but they may ignore it. They may lose their family, their wife, their home in the process. Most people respond to common sense but a few do not. They seem immune from common sense even if the suggestions are to make them or save them money.

Posted: Tuesday, Mar 13, 2007

Current rate 5.05%

Have hit 5.05% for the 5 year fixed. The variable is anywhere between prime minus .75 to prime minus .85. Rates are low and many have a full look back meaning that if you get a preapproval or commitment today it is good for 120 days and during that period you may get the ultimate lowest it goes to during that period. You can't really lose. Some lenders offer this and some don't Rates across the board are good and most people are opting for fixed vs variable. The rates for fixed are great and they don't have the risk of going up and down with variable.

Posted: Tuesday, Mar 13, 2007

Islamic Mortgages

In the Hamilton Spectator today there is a good story about Koran friendly mortgages now in the city. A Hamilton Credit Union (McMaster Savings and Credit Union) is the first to offer Shariah friendly mortgages. A typical lender charges interest, which is against Islamic law. Instead the client pays a fee which is getting around this obstacle. Deposit accts pay dividends instead of interest. To be Islamic compliant a mortgage must be financed interest free from start to finish. It is interesting and innovative. It is a good move.

Posted: Tuesday, Mar 13, 2007

U.S. Problems

U.S. foreclosures are at 900,000 and it is effecting the whole financial structure. Subprime mortgages were given to anyone with a pulse. Canada has been different, subprime mortgages have risen here but they still maintain good standards and the whole system is much more sound. In the last few years especially there has been a increased pentetration of American style lending products and style and this may come to a halt. I think Canada has adhered to common sense standards. The U.S. stock market has taken a large plunge today based on the problems and the ripple effect of the housing market.

Posted: Tuesday, Mar 13, 2007

Self Employed-March 30th changes

March 30th CMHC are bringing in new rules to make it even easier for someone self employed to obtain a mortgage, over the last few years there have been more and more programs to help the self employed and this continues the trend. They have to have a proven track record for managing debt and two years in the same line of work.

Posted: Wednesday, Mar 07, 2007

U.S. Mortgage Crisis Begins to Spiral

According to the NY Times, the explosive growth in the subprime sector which caters to those with impacted credit and low income, is coming to a crescendo. Poor and minority customers are being hit the hardest. The mortgages are turning out to be too expensive and unaffordable. New Century Financial is a large subprime lender that is a poster boy for those that rode the boom in the good times and is now in free fall. Weakening home prices and rising default rates are rocking the U.S. market. Clients, brokers, lenders and investors will all suffer.

Posted: Monday, Mar 05, 2007

GE Money

GE has a fairly new mortgage division called GE Money which has come through in a huge way for a client. The division specializes in doing ALT A work or common sense lending. They have certain parameters but common sense and flexibility seem to be the keywords. We had a very good past client who had gone through divorce, because of legals etc and the size of house he downsized too (which was still fairly big) the cashflow was out of sync, he decided to downsize further and get very strong, his LTV and ratios were great but the credit number was very low. We gave good background explaining where the client was and why and what the intended outcome was and why it made sense. GE Money did it and the client is very grateful, so grateful that he would not mind being the GE Money poster boy for what can be done. Client also wishes us to run credit updates every quarter and keep GE Money posted until he converts mortgage over to CMHC in 1 years time. Client is VERY VERY grateful. GE Money had faith in him and he intends to repay that. It is a hell of a success story.

Posted: Saturday, Mar 03, 2007

Ottawa Client

A past client who currently works in Ottawa-Hull was thinking about buying in Toronto. He was telling us that he was making offers that were 50,000 or more greater than list price and still he was losing out on multiple offers of nine or more people. Client may choose to stay put. It sounds like Toronto is a very competitive market, he was saying that you almost had to go firm on an offer to get anywhere which from a mortgage and banking POV is dangerous. What if the home had a significant problem or did not appraise correctly? The client could be put in a bad spot.

Posted: Thursday, Mar 01, 2007

Huge Victory

We had two mortgages to be completed either this Friday or Monday. They were complex and somewhat fragile. Bottom line is they came together and client is very happy. It involved a client buying a home without firming up the sale on their current home but was made difficult by 2-3 hindering factors. The client now has there home and the key is not to go long with two home and two mortgages. They intend to sell old home fairly quickly. The client and lawyers and ourselves put a lot of time and effort into this and we are all glad it worked out.

Posted: Sunday, Feb 25, 2007

Jackie's Leaving

Jackie has worked here since October 2003. Since the beginning on Queen Street and we are grateful. She has done a magnificent job, is very professional. The company has a good reputation and she is responsible for a lot of that. Jackie has a promotion working for a large company with good job opportunities. We wish her the very best. She has been terrific with us and will be terrific at the new company. It is a big loss to fill. She is great at her work, no two ways about it. During the last 3 1/3 years we have had a lot of experience and a lot of stories together. She will be missed. Best wishes, always, Graeme.

Posted: Sunday, Feb 25, 2007

Advice for Long Term - Dunnville

We did a mortgage for a client in Dunnville tonight. We gave them both tactical and strategic advice. Short term and long. They have good assets but were badly advised in the past, to such a degree that they had problems but were not advised how to resolve the issues. They said that their prior mortgage broker drove up to there house in a gold coloured Rolls-Royce and made them feel small. They were charged a large fee for the priviledge of being made to feel small. They were not given advice on improving but when mortgage came due again they were in same boat as originally because they did not know any better. We gave them advice to solve immediate issue and long term how to convert into one of the big five banks. Clients very grateful. Meant a lot to them.

Posted: Tuesday, Feb 20, 2007

U.S. mortgage industry: Train wreck starting to happen

Another article in G&M February 9, 2007 by John Heinzl. Share price on subprime lenders decreasing. Much lending to impaired credit clients based on promise that prices would rise and offset losses. This has reversed. Loose lending policy, no money down mortgages, interest only mortgages and other "tricks" to lure clients. Tricks may include teaser rates on variable mortgages. Amount of no money down mortgages and subprime firsts and seconds have defintely increased but I am not sure it can be slowed. People want these products. I think key thing is cashflow and affordability which is not an easy thing to get people thinking about. Most Canadian lenders are very responsbile but longer amortizations, the rise of NMD resemble the U.S. and that is a bit of a concern.

Posted: Saturday, Feb 10, 2007

U.S. mortgage lenders rattle markets

This was a Globe and Mail article from Friday, February 9, 2007. It basically states that loan losses are increasing especially on subprime mortgages. Expectations of first and second mortgages in "B" market to get worse. HSBC raising its loan loss provisions. HSBC seconds grew 30% in 2005 and 2006. U.S. congress has been told reckless lending has created crisis. Canada by comparison is much more stable and conservative. HSBC will tighten lending requirements. Some say worst yet to come. U.S. government uneasy with rapid growth in subprime In U.S. more than 10% of subprime mortgages are now more than 3 months in arrears. Quite a shocking figure for U.S. is that roughly 20% of subprime mortgages end up going power of sale or foreclosure. HSBC became so big in subprime by buying Household Finance. Again, Canada is viewed as more stable.

Posted: Saturday, Feb 10, 2007

Outstanding Legal Work - Chris Sherk

A client needed a micro-second mortgage in an emergency. The bank who held the first mortgage was not being very cooperative and it was almost like they did not mind if the client went down the tubes. An emergency second was arranged but both the second lender and ourselves and the client had baited breath because we were not 100% sure if it could close that quickly, if it did not close the bank was going to take the house and yet the client has been messed around fairly badly by the branch in the first place. It was a situation where the client may have been right but the wheels of money were such that he was going to get jammed. Chris Sherk saved the day, know two ways about it. Quite a remarkable job and I don't think the client will ever forget it. It was a small mortgage on a small house and many might not even bother to try but the client has his home back and he is grateful.

Posted: Friday, Feb 09, 2007

Family Bonds

Had lunch today with a past client who is a very wise man. He moved into his home in Ancaster and his brothers moved into three houses nearby, it is 4 families all in a row. Fair actually did all four mortgages. Kids play together and they learn to get along. His background is strongly focussed on the well being of the children. He was imparting some interesting tips to being happy in life. He does not sweat the small stuff and he said the key is focus on the glass being half full rather than half empty. If you focus on the negative it will be tough for you and all around you. Life has a lot of ups and downs and you just have to ride it out.

Posted: Tuesday, Feb 06, 2007

Production Trends

The trends are very positive. The volume of all types of mortgages have risen. The amount of second mortgages being requested is quite dramatic and the volume across the board is quite good. Our people, even people newer to the mortgage field but are foccused on the client and customer service are doing very well. The customer satisfaction surveys are coming back where we are scoring in the 95-100% range with much more mixed scoring going to the lawyers involved. It seems that some lawyers are regarded quite high and some are not. I think the atmosphere is almost college like, very easy going, very friendly and sharing. It is great. Just great.

Posted: Friday, Feb 02, 2007

US Boss

Met a former boss from years ago at a conference in Burlington recently. He had worked in the mortgage industry in North Carolina and California. He had an interesting take on things because he has worked so heavily in the mortgage industry in Canada as well as the states. He said that we would probably earn about 2-3x higher income just by being in the states doing the same volume of work as they pay that much. He said it is very cut throat and not a lot of emphasis put on giving the client good advice but more in and out and that is it. It is totally about money and all other factors are thrown to the wind. He said we would hate it because it is not as family friendly. It was tougher as a way of life. He smiled and said we would do extremely well financially but we would hate it socially and family wise. I think he found it interesting but I think he is glad to be back in Canada. Wish him very well.

Posted: Friday, Feb 02, 2007

Guinness

A wizened 99 year old Irish fellow said that Guinness was the elixir of life. He said that each pint you drink adds 1 week onto your life. It is one of the few beers which are supposed to be good for you. I was told by James Rooney, a former pub owner in the little fishing village of Ardmore in the south of Ireland that the record for drinking Guinness was one fellow at one sitting downed 36 pints in his establishment. Have noticed that all these folks who drink Guinness live a long life and seem thin and are happy. Maybe they are on to something!

Also, if we do a good job for you in getting your mortgage, Guinness is a most welcomed gift.

Have a great weekend.

Posted: Friday, Feb 02, 2007

BMO

We learned yesterday that Bank of Montreal are pulling back and closing their broker unit. BMO and FMSI did not do a lot of work together but what we did was very good and some of the biggest customer service kudos were BMO and the new immigrant programs. Wish them the very best and it might good for them to reconsider as the US trend is that a growing volume of mortgages originate from brokers so having a broker unit I would think is invaluable. There has been a lot of activity in the market, Home Trust has consolidated its Hamilton office into Toronto. Quite a lot of change.

Posted: Friday, Feb 02, 2007

Thank You - Burlington

Thank you for all of your last minute scrambling! Our mortgage worked out ideally and we are very happy. We thought you deserved to relax and enjoy some Guinness this weekend. Cheers, B&D Burlington, Ontario, Canada

Posted: Friday, Feb 02, 2007

Expanding Options

The mortgage market is changing almost daily. New products are coming out almost daily. Today we positioned 2 mortgages that would normally be hard to place. Both were done and the clients are very very happy.

Posted: Wednesday, Jan 31, 2007

Financial Assault

A couple came into see us tonight. They had credit issues years ago and have not got any re established credit but they have good income, they have good net worth in their home and they have good net worth in terms of RRSP's etc. They have a first and second mortgage, the first is with TD and paid perfectly. The second mortgage is with someone else. The sense the clients have is that they are being financially taken advantage of in terms of fees and worst of all they have a sense that the mortgage holder is trying to take their home away from them and sell it at a profit. They feel that because they are financially naive, they are being taken advantage of and bullied into something not in their best interest. We gave them a few different solutions plus a roadmap of how to reverse the situation around and get a great deal. When I talked on the phone I could not quite believe what they were saying but they were sincere. We have noticed a few situations where homeowners appear to be getting bullied into giving up their homes. They been treated well by the bank but the private lender is another matter. We asked them to find out the answers to a few questions then let us know tommorrow morning, they will fax it over and we will firm up the solution for them. Next step would be to get a framework for a mortgage then an appraisal.

Posted: Tuesday, Jan 30, 2007

Appraiser - friend or foe?

This is an article in the January 2007 edition of Real Estate Marketing, it is by Lloyd Manning and it is very good. There are a lot of good points that are made throughout. When a client wishes a refinance of their mortgage we find that there can be lot of variance in the value, that is understandable. When a client is purchasing a property the amount of variance is quite a lot less (usually). We would have a general concern if the appraisals on properties are coming in systematically low on purchases. Many times if this occurs we or the client or the bank may request a second opinion, if the second conservative opinion comes in differently we are concerned about what is happening. I think appraisals can be fairly subjective. If the appraisals are coming in systematically low it seems that a lot of people are being unfairly hurt.What we have always asked for is just a fair appraisal. If we get two appraisers, both highly regarded and yet we get big variances in those values, what does that mean? I am not sure what the answer is but it seems to be a probably that is gaining strength.

Posted: Wednesday, Jan 24, 2007

Combo Mortgage

A U.S. company is advertising the combo mortgage. They are advertising as combining a first mortgage and second and any loans you have combined with credit cards as a total refinance. This is identical to a normal refinance. You can refinance for a large number of reasons including renovation, investments, children going to school or obtaining a lower mortgage rate/monthly payment. The term combo mortgage or combo loan is a good marketing term but it is a new term for a standard product.

Posted: Monday, Jan 15, 2007

Enthusiastic and Happy Working Environment

We had a visitor today who visits all of the mortgage offices here in Hamilton and surrounding area. He was very pleased with what we were doing and said it was rare that he would go into an office where everyone seemed so enthustiastic and so motivated. A happy work environment, collegial, is terrific and makes work a pleasure . You can have a good time and do good work.

Posted: Tuesday, Jan 09, 2007

Indescribably Better

Client is buying a four plex. Called to clarify a few items and said that the service, speed and accuracy were terrific. I said we were very pleased and if we had done a good job maybe we could quote him on other mortgage work. Then he went on to state the the level of service was fantastic and he was very happy. The agent who he was working with has earned some rave reviews in terms of service. Was taken aback about how pleased he was. Many clients are very happy but they don't say too much. He said we were indescribably better.

Posted: Tuesday, Jan 09, 2007

Those Guys Are Good

We are doing a mortgage for a client on Hamilton Mountain. The application was done at 7.00 in the evening when it was convenient for the client. I asked the client how they heard about us? They said that they were told from friends that "those guys down at 17 Queen Street are really good." She did not know a name but she knew the location and that was great. She needed good, fast and accurate advice.

Posted: Monday, Jan 08, 2007

Scotia Client - Quick Closing

An existing client with Scotiabank has bought a home in Burlington closing next Friday. We were given conditional approval and client supplied most of documentation today, Scotia requested most of it be provided up front because it was so close to closing. Client given great service. Current home they live in has not sold yet and Scotiabank giving them a lot of leeway. Both clients are excellent people and appreciate the service.

Posted: Thursday, Jan 04, 2007

Equity Draw on Rental Property

Client refinanced his rental property to payoff some bills. Eventhough a pure rental we obtained 5.10% financing for the mortgage.

He requested an amortization of 10-15 years which bank would not allow because ratios on paper appeared tight. Our solution was to run with a 25 year amortization and make boost the monthly payment 15-20% and make once a year lump sum reduction of 15-20% which would serve to bring amortization down under his control and his discretion.

You can take longer amortization then bring it down under your control, it is much easier/flexible to do this than to take a 10-15 year and then stretch it back at a later date.

Posted: Thursday, Dec 28, 2006

Wealth and Happiness

A wealthy client dropped in for a coffee yesterday. We had a good talk and she said many interesting things, a key thought was that being wealthy has not brought more happiness in life.

It is an interesting thing, sort of the grass is always greener. It goes to the point that almost everyone has difficulties as some time or another but many times we can't see it because it is financial and remains hidden.

Posted: Thursday, Dec 28, 2006

Ratios

When looking at an application there are a few key things we look at. First is LTV or Loan to value, this denotes the size of mortgage divided by the value of the house. This is a good indicator of risk, it is perhaps the first thing that comes to mind when putting a mortgage together. Second ratio is the GDSR which is gross debt servicing ratio. It is the mortgage payment plus property tax plus heating and condo fees over your monthly income. It is generally accepted that up to 32% is good, up to 40% might be okay depending on your spending habits. The third ratio which I think is very vital is TDSR or total debt servicing ratio. It is the cost of your house expenses plus adding in your other short term debt such as loans, leases and credit cards. Up to 40% is normal but there are banks coming in which are expanding this to 45% or even 50%. In my mind if your debts are 40% or less of your income you are okay, if 40-45% it is doable but a strain, above 45% you are facing a real potential problem. This ratio is a key indicator to me of stress. If your yearly mortgage payments, combined with yearly proptax and heating and condo combined with year credit cards and loans divided by your gross yearly income comes to 40% or more, then you have to really thing is it affordable. It is an extremely good gauge. The GDSR and TDSR would not apply if your self employed and where income is hard to ascertain. TDSR is more important than GDSR because it is a global measure, it includes all the critical stuff. Your GDSR could be 28% and be normal yet TDSR could be 55% because of credit card debt and loans etc. TDSR is a vital measure of stress.

Posted: Wednesday, Dec 27, 2006

U.S. Credit Score - Employment

Some companies in the U.S. are starting to run credit bureaus to evaluate possible job candidates and to evaluate current employees.

This is a very immoral act.

Almost EVERYONE goes through ups and downs, it may be job loss, divorce, you become sick, a loved one becomes sick or your business may fail. There are many reasons why your scores may go up (good) and down. There are a small minority of financial and trust related companies which need to know the score of their employees, verify if they have gone through bankruptcy etc. But not many.

If someone is doing a clerical job, say a lady with two kids and the husband leaves and does not pay support and her credit score is impacted because of his actions or because she must temporarily use the cards to try make ends meet, it would be wrong of an employer to judge her on a non-job related action.

The whole things smacks of big brother and it is nasty. It would be severely unfair to someone applying for a job. It would give the potential employer a sense of power and knowledge which they don't need and don't deserve in evaluating the merits of someone.

It is a VERY, VERY bad idea.

Posted: Saturday, Dec 23, 2006

The Corporation

This book is subtitled "The Pathological Pursuit of Profit and Power" by Joel Bakan, it has been on both TVO and PBS. It is quite a read. It compares corporation to potential psychopaths. Corporations have grown in power and influence and they have had a large impact on people. What is pretty clear is that unrestrained and unregulated corporate power is very bad for the individual and very bad for society. The author compares corporations against the DSM IV psychopathy checklist and the results are quite stunning. Some people think that it is just the way it is and there is no hope against changing things for the better. They are wrong. Things can change for the better. We just have to want to and act on it. This book is a keeper. If you take it combined with the teachings of Henry Giroux from Mac you get quite a an outlook. It is quite a wake up call. It is good to hear all points of view, gives you a pretty well rounded outlook. People complain more and more about companies but things can get better. Family, friends and community are the centre, they are the most important things and everything else is window dressing.

Posted: Friday, Dec 22, 2006

Thank You December 22nd, 2006

Where to start? There are so many people to thank. Just want to express our gratitude to our clients who have been key in spreading the word. Thanks for all the surveys you've returned, it really helps. Want to thank our agents who have put our clients first and foremost and have strived to set a unique standard of service in the industry. Along with that I wish to thank the many underwriters and BDO's we deal with day to day and who have helped in making sure that the service levels are high and have done some incredible work. Really incredible and we appreciate it very much and our clients love it. We owe you a great deal and we thank you very much. If you have any comments or ideas to make us improve drop us a call or email or letter. We are good thanks to you, our clients.

Posted: Friday, Dec 22, 2006

Appraisal

On high ratio mortgages (0-24% down) the lender may get it insured under CMHC or Genworth and an appraisal may not be required. If it is a mortgage of 75% or less or if it is a self insured product a formal appraisal may be requested. The appraisal is usually 12-22 pages long and gives a good snapshot of the true value of your home. It takes in market trends, comparables and comes up with a good solid figure of what the bank could sell the home. The smaller the down payment or equity on a refinance the more crucial the appraisal, it could be a make or break item. Many lenders have designated appraisers and many will only accept the values from approved appraisers who have proven reliable in the past. Appraisals are usually ordered through us but sometimes a client may want an appraisal for their own purposes or because it is a private sale and they are not sure of the value. This can be ordered directly or through us and directed towards the client. We have a list of approved appraisers for each lender and match them up appropriately. Each lender has their own preference with a few appraisers being on everyone's list.

Posted: Tuesday, Dec 19, 2006

Non Judgemental

Taking a non judgemental approach to finances is important. Everyone goes through ups and downs, divorce, job loss, illness, business problems there are a lot of reasons why anyone can have ups and downs. It is common to everyone only we don't always know our friends or relatives finances.

When someone has a situation it is important to give them solutions and a roadmap out of their difficulties. We are like a doctor, we provide technical solutions to resolve the problem and long term advice to guide them.

A bank manager said recently that once a "B" client always a "B" client that that got my back up. It is key to get the "B" client or "B" situation to "A" and that can be done, it can help the client through lower interest rates, it can help the bank through another mortgage and it can help our agent through transacting another mortgage.

The only way that the client may be severely hindered from moving or progressing is if they suffer from a form of addiction, if an addiction is making there cashflow go out of whack it is very difficult to give them advice and have then follow it. It is very difficult if it involves gambling etc.

Posted: Sunday, Dec 17, 2006

Christmas Party

We are going to have the company Christmas Party on Friday, December 15th at 7.00. It will be a potluck dinner. All the kids are VERY welcome. Should be good, I am making a roast beef and everybody is bringing a something to (hopefully) make a complete meal! Remember to bring the wine and beer. Sent directions via Google and will send out an email giving more specific instructions for non Hamiltonians.

Posted: Wednesday, Dec 13, 2006

Compliment

Today we received high praise. An innovative and key lender said that our approach to our clients was unique. That in most cases the mortgage is just viewed as a financial transaction where as our approach is the betterment of the client by way of education or positioning or advice. I think we are taking the right approach. We explained to the lender that our approach was win-win-win. I think everyone should be gaining, make it a very positive thing.

Posted: Tuesday, Dec 12, 2006

Fundamentals??

A lot of people are worried about things and common things I hear when signing clients up is "the importance of family, friends and achieiving happiness." They are thoughts which everyone is aware of but we don't always practice day to day or keep that in the forefront. As things get tougher in the global economy and competitition maybe sticking together, being closer as a community might be the route to consider in keeping our sanity and happiness. I notice that families are starting to band together for strength, a good example is a large family in Ancaster who have chosen to live on the same street, there are maybe 4-5 couples with a lot of kids and the family is close knit. They said that they feel more security in being close and the kids can play together and they are strong.

Posted: Saturday, Dec 09, 2006

New Economy

People are finding many hardships. We see the rise of credit cards, lines of credit and mortgages. At the moment there is a lot of uncertainty, the level of confidence going forward seems mixed. In the auto sector, both the assembly plants and auto parts plants have been the source of layoffs and this has had a ripple effect right down the line. A lot of clients in general have worry about the future, they talk about globalism and the loss of individual power. They feel pretty helpless. We are suggesting to people that they try and make their lives bulletproof in terms of making things affordable and manageable. Saw a client who needed a minor refinance yet was actually considering bankruptcy because of the worry (as he put it) of the new econonmy and uncertainty. Trying to get rid of worry, debt seem to be common themes. Simplifying life.

Posted: Saturday, Dec 09, 2006

Evening Sign-Up/Money Connect

The Toronto client we got approved at a lower rate was signed up that very night, one of our top agents went out to visit him in the evening and go through all the conditions and features of the mortgage and sign him up. An appraisal will be ordered today.

The client situation was fundamentally good but a bit unusual so that it didn't quite fit in most niches. We found him a niche at a lower rate and he was pleased and we were pleased at getting this mortgage done for him.

It was positioned with a new lender but the contact was very reliable and we went this route based on past experience with the individual underwriter who we trust implicitly. Again, much if based on trust and relationships, it is not all as cut and dry and strict numbers, it is also past experience and past trust.

We are all very happy for the client and very happy for the agent. Very good work, no doubt about it.

Posted: Friday, Dec 08, 2006

Toronto Mortgage Company

A client was referred to us by Remax in Toronto. Client was quoted a very high rate to buy their home. Talked to client and it seems they were not told the whys and wherefores and were not told who the bank was or what the conditions where. Client was left in the dark and had to base everything on trust and a lack of information. Client felt very uneasy about this approach. We gave them the pros and cons of different approach with the key element being saving them money and looking out long term.

Posted: Wednesday, Dec 06, 2006

Two Step Refinance

Couple have a first mortgage with a credit union and also have a small second. They wish to combine two and add on cards and retain 1 loan. Wife has a credit rating which is good and husband has been impacted. Proposal is to take a 1 year term to get them on straight and narrow and then place mortgage with one of the major banks. We cannot go from where they are now directly into a major bank because of his credit rating but it will work out, just need a bit of patience. One year should do the trick.

Posted: Tuesday, Dec 05, 2006

Self Employed

There are quite a few great options for someone self employed. The main factors in suggesting which bank it goes to would be: -credit rating -how long self employed, do you have documentation? -how much to do you have as a downpayment?

It used to be that being self employed meant great difficulty in obtaining a mortgage, things have changed for the better. Now, there are quite a few options. From a risk point of view, the longer you have been self employed the better. There are many routes to choose from. b

Posted: Sunday, Dec 03, 2006

Caledonia - Collateral

Client is in process of selling current home but has not firmed up yet. They are getting a large home and we are suggesting three routes to bridging through in the meantime then we will recommend an excellent mortgage when everything is complete. It is a two stage solution.

Posted: Saturday, Dec 02, 2006

Cottage - 800,000

Client wishes to buy a cottage in the 750-800K range up in Muskoka. Based on credit and income the client has some excellent solutions. We will get a rate in the 5.05 to 5.09 range, 5 year fixed. Current variable ranges from prime minus .75 to .80 to .85. Depending on overall package. Will issue options to client to pick from. Client wishes to go open and that will be no problem.

Posted: Friday, Dec 01, 2006

Refinance - Nurse

A nurse who has laid out quite a bit of money for family related problems needed a solution that would fit her situation. She has a first mortgage with a major bank (which we obtained originally for her) and she has accumulated about 25K in credit cards and loans which are causing her ratios to be way out of whack. The recommend solution is to retain the first mortgage as a cheap option then tack on a small second mortgage to get rid of the other debt. This is a good solution because the credit rating has gone quite low. The key thing here is to get the credit rating quite a bit up and then consider other options. She basically has to re build and take process in steps. Her income is excellent and it just condition of first mortgage and credit rating which are the issues. She can get back on track the thing is what will she do after the refinance. Her debt will eliminated except for the mortgage and cashflow will be very good. From our point of view we can recommend a solution but it is up to the client what they choose to do with it. She is a good client and deserves to do well.

Posted: Friday, Dec 01, 2006

Broker Fees

This is by far the most controversial area of mortgage brokering. Broker fees would not appy to the majority of mortgage transactions. Say that your income and credit is normal we would be glad to receive our normal compensation from the banks. They can offer you a great rate and pay us a fee and their overall cost is low.

If the mortgage is unusual or complex or in some other way outside the box a broker fee may apply. A good example would be a second mortgage which is arranged privately in which the only pay would be from a broker fee as the lender does not offer any pay for it.

That being said, most mortgages are cookie cutter normal but when you have situations that are different, a broker fee may apply. I think there are two main schools of thought on this:

(1) What is fair? (2) What Can I get?

What is fair has always served us very well. You weigh up the complexity and time involved and come up with what is fair. This is a long term position where you count on making the client happy and viewing the it is a long term solution. An excellent example would be a client we had in Nanticoke where we did a second mortgage (because of the situation) and suggested to the client what to do to qualify for a refinance of both mortgages at a great rate. In this case we did the mortgage with a broker fee. Client followed our advice then we re combined both 6 months later. Client obtained a 5 year fixed rate of 5.30% and was happy as can be.Thrilled would be putting it mildly.

The other philosophy is "what can I get." I think this view is short term and hurts the client and the agent as well. I say the agent because it is not a long term and sustainable outlook. If you do the right thing by a client you can sleep well at night.

Sometimes an agent will inquire as to what is fair, it can be a subjective matter but in all these years we have never had complaints but we have been told by many that if we charge fees they are very low. I have pondered this a lot but I think what we are doing is right, we are relying on volume of deals rather than income per deal.

This is what has caused the industry grief, that and ethics. If it were more standardized that would be better but it is up to each individual. That is the problem. It is incorrect to say that if you get a mortgage through a broker you must be a fee. That is wrong. It is fair to say that you get tremendous expertise and options and we really excel when given a challenge.

Posted: Thursday, Nov 30, 2006

Risk, Return and Rates

They are all interrelated. You blend your income, nature of your income your credit rating and amount of downpayment and a few other factors and you put it through the calculus and out comes solutions and rates and product. In general the banks will price according to risk, it is really cut and dry. The rates will reflect the circumstance and they are usually priced fairly. There may be some variance between banks but overall it is fairly straightforward. Most people will qualify for a fully discounted wholesale rate. Some may not, they may qualify for a higher rate depending on the situation. If the client is slotted into a higher rate niche right now it is key to think how to get them lower or what they have to do or how long it will take to reposition.

Don't forget, banking and mortgages are very competitive. If a bank were abnormally low on rates they would get a surge of billions of dollars of new work, if they were abnornmally high they would get next to no work. They have to balance it out appropriately.

I will talk about broker fees next.

Posted: Thursday, Nov 30, 2006

Frank Situation & Hope

Client asked for a mortgage of about 100,000, This would require an income of about 30-35,000 to justify. They have 10% down and based on their income and credit we are recommending that a relative buy the home. The nature of her income is such that the she can justify the mortgage payments but it does not show up in the normal way. We offered her the solution of a good cosigner or a relative. She is going to mull over and see what can be done. Very kind lady in a tough situation. It is best to give her options that are viable in lieu of her credit and income situation. Client has overcome a lot of hurdles to get to this point. The spirit is incredible and we just have to merge that with the unshakable requirements of our banks. It has to be unwritten and that will be with a totally unbiased view It goes to the theory that 98% of all mortgages can be done, it is just how it is positioned, how it is arranged. It must be a win-win-win situation. It is a little more difficult when the situation is emotional and the person wants it so much, it is act of true kindness to take that situation and merge it with what is realistic. The person can work with that and come up with a viable solution. You have to give the person hope. The client may come back with what we have said and take us up on one of the solutions and if she does, I will be very very impressed.

Posted: Thursday, Nov 30, 2006

Bridge

We did a mortgage for a client a few years back. They were preapproved to buy a home for up to 400,000 but they have not sold there current home, they don't have a firm offer and it will not firm up before they move into new home. They don't intend to sell soon. Traditionally the banks may require either a firm offer to do a bridge or incredibly high income that would support two mortgages simultaneously. We are going to offer the client three routes to choose from which will allow them to buy the new property then sell Hamilton house at their leisure. We will offer them three solutions and they can decide what is best for them.

Posted: Thursday, Nov 30, 2006

Small Preapproval

Client wishes to buy a very small house in Hamilton. Client has limited income and wishes to buy a fixer upper for a modest amount. Has 15% down and he is buying in a tougher area but we will get him CMHC approval and package in a very good way, his mortgage payment will be 360.00 per month and property taxes would be extra. His current rent is probably twice that and this way he builds up equity in his own home. He also has prepayment priviledges so he has a number of ways to knock the mortgage down over time. We are suggesting he goes for a 15 year amortization. His overall income is quite good and 15 years is a good balance where the payment does not rise that much compared to 20 or 25 years and yet knocks the hell out of the mortgage. If he goes 10 or 5 year amortization the payment increases exponentially.

Posted: Wednesday, Nov 29, 2006

School

A developer commented that many students no not have a fundamental knowledge of money or credit going through school. He said that it would be in high school if students were taught the fundamentals of credit, money and budgeting like they were taught English or Science or Math.

He was suprised at the difficulties some people have. His parents raised him with a strong discipline for money and credit. But many are not.

I think it goes a little deeper and it is a little harder to resolve. I think educating students is a great thing and I think the notion of family and friends and trying to get away from materialism might be a good thing. It is one thing to think this is a good way to go and quite another to actually do it.

It is a lot to overcome.

My friend is right though, teaching this in school would be a great thing, it would be just as important as the other fundamentals. It might be the best thing they ever learned.

Posted: Tuesday, Nov 28, 2006

Retired Client

We have a lady who is on pension who needs a scenario to resolve her of the debts she incurred from her kids. There is a roadmap of possible solutions, they are not easy but it is the best course available. Nothing about the situation is easy. The overall situation is not easy. When a person reaches retirement I think they should have an easier life. That is not always the case and that is painful. Part of the solution might involve downsizing.

Posted: Monday, Nov 27, 2006

Synergy

It is an over used word for sure. But it seems to apply with our people. They are pumped up and are helping each other quite dramatically. It is the aspect we are most proud of and are very surprised with.

The company is small and growing. If someone were to wave a magic wand and it were all to end I think this aspect is the one that I would be most proud of. It is the area where I have learned the most.

I could make this a LONG blog because so much has happened but I will leave it short, but I am very proud of it.

Posted: Sunday, Nov 26, 2006

Penalty Problem

A client wished to get an open mortgage under specific circumstances. We outlined 3 different options that they might choose. They elected for a very well know lender and we submitted the mortgage as they wished.

There was probably a software error and the mortgage was submitted perfectly on our part, software engineers have verified this yet when the mortgage came back it came back closed. The client followed through because we were all under the impression it was open, we have never had something changed without at least a verbal question/warning about it.

The client closed on the mortgage and in the only case of its kind we made sure the client was paid the penalty out of our money and we are taking up the case with the lender, which is not easy because they are big and we are small.

Our approach is the client is not going to suffer for an error which was not theirs. We have explained the situation to the bank involved and they are going to consider it. If they won't make ammends on it we will continue to work with them as they have some good products, we will just be very careful on any alteration of the application.

Either way, we have learned a lesson and the client is very happy.

Posted: Sunday, Nov 26, 2006

Penalties

Penalties can range from zero for an open mortgage to 3 months penalty on average to a figure higher than that depending on the individual lender. Some lenders can want the client to go the whole term and if not there can be a very high price to get out. It depends.

Even amongst the large lenders there can be subtle differences in the way they calculate the penalty, you can not be sure of the exact amount and it is best to ask directly your current lender.

Posted: Sunday, Nov 26, 2006

Bat in the office

Angie and I were talking in the her office and a bat appeared and started fluttering around. Is this a sign we should move? We caught the bat in a box and Jackie was kind enough to remove it.

In three years we haven't once seen a bat. Wonder where it came from? It was funny and shocking at the time but it makes you wonder if it will be a recurring thing. Our office is in a Victorian house about 100-150 years old.

Angie said bats don't bite. That is a good thing I guess.

Posted: Saturday, Nov 25, 2006

Hidden Truth

A truth which we don't realize because finances tend to be very private is that many of us a have lot of debt. Another truth is that almost everyone goes through ups and downs in there life, it could be job loss, divorce, illness, a lot of different things. I think the key is to get over these hurdles with sound advice. Most problems are solvable. Sometimes a person can have tunnel vision, but think outside the box and there are usually a lot of possibilities. Again, there are many of us, neihbours, friends, family that go through a lot of ups and downs and a lot of it is private. But it is widespread. A key is getting a good independent opinion on solving the problem. Almost everyone has problems, I won't say everyone but almost.

Posted: Saturday, Nov 18, 2006

Agents

We now have 7 people working for us. The morale of the group seems sky high and it is a happy bunch. The key thing seems to be having a focus on professional standards and trying to do the best for the client.

It results in a great working atomsphere (not sure of the spelling on that one)!

Posted: Saturday, Nov 18, 2006

US Like

The mortgage market in Canada has been quite a mirror image of Canada. What is happening now is the mortgage market seems to be going more and more in a US style. The TDSR and amortizations are creeping up and I am not sure it is in the long term benefit of the population.

It may mean that more mortgages can get done because the parameters are so wide, but at what cost? We have to be careful about it. If a client needs that type of solution for the short term we provide it but we give a roadmap, if you follow the roadmap you can do okay.

It is a point to ponder. The US might not be a good role model or it could be that society in general is going this route. Maybe is is a world wide thing.

Posted: Saturday, Nov 18, 2006

Christmas Party

We are having our first annual Christmas Party. It will be kids oriented. We will probably have 25-30 people.

Athought has been the location. If you don't have kids then bring your nieces or nephews.

Just got to hammer out the location. Cost can be an issue. Maybe having it at someone's house can save some money.

Posted: Saturday, Nov 18, 2006

Happiness

The market seems unsettled. My tendency right now is to make your secure and reduce debt. I would focus on family and friends and happiness and go for that.

I think that credit cards and debt can be a slow poison and a lot of people can get hurt with it.

Some people feel they don't deserve to be happy. I think this can be of real importance to people, it is just trying to focus on this.

Posted: Saturday, Nov 18, 2006

Burlington

A branch called to say if we could provide a solution or options for a client who like the Ancaster client, had just run up some cards and wanted resolved. There were three solutions to the problem. We recommend a solution (based on current credit rating) of preserving the first mortgage as it is very inexpensive, tacking on a small second to resolve out the cards and PLC and other debts then wait until credit numbers are good and situation is very positive then just combine entire mortgage into one with their branch. A key element is the client maintaining good credit and keeping down spending, it is in their court. In a very easy way they can make life better but if they choose to spend again they could face a more dramatic problem.

-Graeme

Posted: Sunday, Oct 01, 2006

Ancaster

A couple with a beautiful home and lots of positives put a lot of money in making the home a showpiece. This was done on lines of credit and credit cards and they found that with the mortgage and their income, they were a bit stretched and it was uncomfortable. They lived with the problem for a number of years. We recommended a blueprint, a two stage solution to resolving the problem. They are working on the first stage now and the last stage kicks in in three years time. The stress level has decreased substantially. Graeme

Posted: Sunday, Oct 01, 2006

Unusual Deal

We had a very unusual mortgage close Friday. It was a very very tough deal to put together and many advised us (including bank lawyers) not to attempt it because it would not work out. It did work out and the client has their home back.

It was a mortgage for the record books.

-Graeme

Posted: Sunday, Oct 01, 2006

Standards

We have set our standards high, it seems that's what everyone wants.

-Clients -Employees -Lenders

They prefer the standards all across the board be set very high. We surveying clients and finding out what they thought, what can be improved. It is an eye opener. -Graeme

Posted: Sunday, Oct 01, 2006

British Doctor

A UK based doctor wished a home in Hamilton, he was a non resident and the mortgage was done through Bank of Montreal. The client was so pleased with the conditions and the rate that he generously offered Jackie and I a tip for a job well done. He closed at 5.35% for the 5 year as a non resident. It made us both feel we had done good work for a good person.

Graeme

Posted: Sunday, Oct 01, 2006

Current Client

We have a client that is a super guy in every way. He divorced years ago and wishes to keep his larger home. We have advised prior that he should sell and downsize and make life easy to handle. He was always against that idea eventhough it may have caused strains on him.

On Saturday we again advised on a course of action and the reasons that his life may really improve. He again stated he would not take the advice but he respected it. On Sunday he called to say he was taking the advice and his life was going to change.

I think he is making a good choice because nothing elese is working, why not try a different tact and see what happens. I think the choice was very good.

Graeme

Posted: Monday, Sep 18, 2006

Refinance

We had a machinist who currently has a first and second mortgage. He asked us if we could simply replace the second for him. We had a look and the terms on the second mortgage were not very good. We suggested that we try and bring both together into 1 package and it would also make his mortgage payment much lower.

We gave the client a roadmap for success and he appreciated it.

Graeme

Posted: Monday, Sep 18, 2006

Growth

We are hitting over 150% of our normal volume. Last Wednesday-Thursday we had 19 mortgage come in for processing. It was a very busy day.

Posted: Monday, Sep 18, 2006

Relative to Relative Purchase

Client wishes to buy the home they rent from a relative. We provided 4 different routes to go about that. A key factor is fair market value and an appraisal. Also given choices as to a vendor take back and different ways to reward their relative who is helping them out.

Posted: Thursday, Apr 06, 2006

Relative to Relative Purchase

Client wishes to buy the home they rent from a relative. We provided 4 different routes to go about that. A key factor is fair market value and an appraisal. Also given choices as to a vendor take back and different ways to reward their relative who is helping them out.

Posted: Thursday, Apr 06, 2006

March Break

There has been a noticelable slow down in both new home purchases and refinances. I think it is due to many people being away during the March break. We have caught up on a lot of paperwork and things that would normally take a second priority to the mortgages themselves.

Posted: Thursday, Mar 16, 2006

Refinance to 100% of Value?

Some terrific people have run into a patch of trouble. They both became temporarily disabled and there income was cut back for 5 months or so. They both have excellent income but the cashflow became strained and credit cards increased. They have about 10% equity in their home. I suggested these possible routes to go: (1) Borrow 20,000 from a relative to pay debt and this would allow you to keep current variable mortgage intact while not adding or replacing another charge. (2) Wait and get credit rating higher and go for a loan or line of credit. This would allow debts to be paid without touching existing first. (3) Wait and we can tack a second mortgage to 100% if the credit scoring is a fair bit higher than it is currently. (4) We can refinance to 100% under current cirumstances but at a higher rate. The going rate on 5 year is 5.10% but to refinance to 100% involves greater risk to the trust companies and they charge a higher rate.

My suggestion was to wait 4-6 weeks. They are currently managing and the credit scores dramatically effect the options they may use. Also, given time a person can come up with additional solutions to the ones I suggested.

They appreciated advice and were surprised there was no fee for the advice. I explained that we usually get paid by the banks unless there is something very unique about the situation

Posted: Thursday, Mar 16, 2006

Pre-Approval

Client in Oakville wished to know options for starting a small business. We provided various options including 1 excellent option of taking up to 200,000 out of home to be used to start a business.

If a client is currently self employed there are a lot of options they have available and just a few years back, the options were limited. No longer.

Quoted 5.10% 5 year fixed with a 120 day rate hold.

Posted: Wednesday, Mar 08, 2006

Bulletproof

A general trend we are seeing is that more and more people are electing to make themselves bulletproof in the sense of making the home affordable and cutting down on debt. Again, credit cards can be like a slow poison and the fewer the better.

Posted: Tuesday, Feb 28, 2006

SNL

Saturday Night Live on February 4th had a skit of credit cards with Steve Martin, Amy Poehler and Chris Parnell.

It was very funny and very true. Chris Parnell was selling a book titled "Don't Buy Stuff You Cannot Afford" and it really hit home. It may be a bit of common sense but it is something that many of us don't give a thought to.

Posted: Monday, Feb 06, 2006

Death Pledge

Mortgage means death pledge or death contract. I guess in the old days it was until death or close to it.

By approaching the mortgage as a tool to help you, you can not only live in a nice home and have a roof over your head that you own but you can make it work for you. I think of as better than an RRSP because the amount you can build up in net worth is substantial.

People have different opinions about whether it is better to pay down the mortgage or put away in an RRSP but maybe a bit of both is the answer. I do know for a fact that knocking down the mortgage can make a huge difference.

Posted: Friday, Feb 03, 2006

Acceleration

A very key element to the mortgage is paying extra on it. Either increasing your monthly payment or paying a lump sum annually or a combination of both.

As a general guideline I think of knocking down 1000.00 as saving me 2500.00 in interest payments over the long run. Prepaying and knocking the mortgage down can really hammer away. It is a great way to build up your net worth.

Posted: Friday, Feb 03, 2006

Faking It.

In the November 2005 issue of Toronto Life there is a fascinating article on people that are living beyond their means. They have a large home, nice cars, private schools for the kids and their income can be huge but they are not making ends meet.

As I read this I thought that this was more common than people realize. The key seems to try focus on happiness and living within your means and not consumerism. The rich lifestyle and living too high a life can bring a huge raft of problems and the problems may be exacerabated by a down turn in the economy.

Was a very interesting article.

Posted: Friday, Feb 03, 2006

Bridgewater Bank

Client was purchasing a home with 5% down and they had gone through some difficulties in past years. Credit was a touch fragile but wished CMHC to get lowest rate and minimum of fuss and muss.

Bridgewater provided client with excellent service in terms of speed and in terms of the approval. Client had a cosigner who may come off title after 1 year.

Client very happy.

Posted: Wednesday, Feb 01, 2006

ING

Client in Stoney Creek liked the rate and the options. 120 day rate guarantee and was familiar with company. Rate quoted was lower than offered on line.

Transfer of ownership from mother to son. Both are past clients.

Posted: Wednesday, Feb 01, 2006

Scotia Bank

Client in Oakville wished to have a relationship with us and the branch as well. Liked the features of the STEP mortgage and full look back on the rates with guarantee of 120 days.

Posted: Wednesday, Feb 01, 2006

Credit Card Debt

Seems to be on the rise. We have seen everything from someone with zero credit card debt to someone with over 200,000 in debt. Credit cards can be a useful tool in moderation but when there are too many it can be a slow poison.

When requests come in the mail or at stores to sign up for a new card I view it as a poison. I don't want to be hurt so I minimize the cards to 1 or 2 and try to payoff the balances.

It is a growing problem and a reason why people are refinancing their homes more and more. Sometimes there are mortgage ads which encourage you to refinance and pay cards so you can live the life you deserve. These can be mis-leading and can be doing the client a great disservice.

Life can be hard. Life can be tough. Overextension on credit can multiply the problems. This can effect your marriage, children, job and health.

Posted: Tuesday, Jan 31, 2006

Need Part Time Worker

We are putting an ad in the Spectator this Saturday for someone to work 10 hours a week doing clerical work and phoning clients.

The working environment here is very positive.

If you know of anyone they can forward their resume to Graeme at our address or graeme@fairmortgagesolutions.com

Posted: Tuesday, Jan 31, 2006

Affordability

A client wishes to buy a fairly large home. Their income may be very low because they are self employed. There are a number of good ways to obtain a very good mortgage for someone self employed and the key thing to watch for is affordability.

In general the rule of thumb that you can afford a mortgage 3x your gross combined income usually works out well.

If you choose to go higher than this, you could be putting yourself in a risky situation for the future. It may be technically possible to get a house of your dreams but you should be sure that the mortgage payment and taxes are comfortable for you. You should make yourself as secure as possible.

Life has many ups and downs and being conservative on the price is a good rule right now. If you develop financial stress this can spread to your family, friends, work like a chain reaction.

Err on the side of caution.

Posted: Tuesday, Jan 31, 2006

Spending and Budgeting

Working with a budget can be invaluable. The current levels of spending and credit is very high. In general this can add to a individuals stress level. Credit can be a low poison.

Knowing where you stand can give you peace of mind. With the amount of advertising we face, we are encouraged at every avenue to spend - spend - spend. It can be false because we spend and spend and in the end we are not made happy by the material things then we have the double whammy of the debt coming back to haunt us.

In reality this can hurt us dramatically.

Posted: Tuesday, Jan 31, 2006

AGF Trust

This morning, AGF performed a miracle of customer service for a client in Hamilton. It was not something they had to do and actually caused them a lot of run around but they did it in the name of customer service and the two underwriters and the BDO involved all deserve a pat on the back. The client stated this morning that he wished to express deep gratitude for their help and wished to know the names of the people involved.

It was good work and AGF did not have to go the extra mile.

Posted: Wednesday, Jan 25, 2006

Managing Growth

This has become a big issue. Sometimes a company can experience too little or too much growth. I think the key element is coping and adjusting to growth in such a way that the service levels stay high and it is seamless from the client POV.

We are trying to get three good people to work with us and contribute. The working environmnent is very positive and very friendly. Our goal is to make sure that we all succeed together.

If you have any thoughts about growth and managing it, we would welcome your ideas.

Posted: Tuesday, Jan 24, 2006

Maximum Fence

Paul and Tammy Whitty bought a new home recently, their current home was closing after they moved into the new house, therefore requiring bridge financing. They are self employed so some interesting mortgages were available to them both. It used to be that self employed clients could have difficulty obtaining a mortgage because the net income was usually low after all the right offs but now some banks can have excellent programs that dovetail nicely for these clients. P.S. Maximum Fence have won quite a few awards and won top awards for entrepreneurship and professionalism. Excellent people and an excellent company.

Posted: Tuesday, Jan 24, 2006

Good People Needed

We need three good mortgage consultants to join us and help shape the company. The consultants will be client centred and service oriented. If you know of any good candidates let Graeme know at graeme@fairmortgagesolutions.com all resumes treated with strict confidentiality. If a person is sincere about the business we can help them in many ways.

Posted: Tuesday, Jan 24, 2006

Refinance: Hamilton Mountain

A lawyer called with a problem, he had clients who were very good but they had an unusual problem on refinancing. They were told by a number of people that the problem could not be resolved. By getting all the facts and the situation clear we were able to find a bank that would do the mortgage as they asked. It saved the about 1200.00 per month in cash flow. It made a huge difference to their standard of living. -Graeme

Posted: Thursday, Jan 19, 2006

Unusual Debt

Had a situation where a client had fairly large debts to deal with. Great income, great credit rating. Just a large amount of debt to resolve. The amount in credit cards was over 190,000 which is unusual in itself. We gave the clients 3 options or suggestions. All 3 were quite good but he elected for the 3rd option to resolve the situation. Monthly interest payments were over 6000.00. All three ideas were financially good and helpful but client elected to take option three and wipe out much of debt. I think resolving part of the debt meant alleviating the stress.

Resolved situation and gave client advice on the future.

-Graeme

Posted: Thursday, Jan 19, 2006

Volume up 50%

On October 26, 2005 we went independent. Since that time the volume of work has gone up 50%. It seems that clients like the idea of getting personalized service and great options.

Not sure why it has boosted that much. There has been no real proactive work on our part. Again, most of the mortgages we get are word of mouth referrals by past clients.

We are small but we try to be the best.

Posted: Thursday, Jan 19, 2006

Stoney Creek Clients

We did a mortgage for a client on Stoney Creek mountain about 5 years ago, they wish to change title and gift the home to their son. We have given them quite a few options on what they wish to do and the pros and cons of each route. They will have about 4-5 very strong options and we explained the whole procedure and what would be involved. They were very grateful and very glad to talk face to face about a complex matter. Super people.

Posted: Thursday, Jan 19, 2006

Waterdown Clients

Met with clients last night at 6.30 p.m. Couple wished advice back in July of 2003. Provided them with detailed advice and they followed instructions and are very happy and able to buy a home now for 220-250K. Gave them advice on present situation and going forward what market conditions and rates could be. Quoted 4.99% 5 year fixed and they are pleased. They were appreciative of the help we had given them and would not forget. They said we were the only that cared enough at the time. Their feelings ran deep.

-Graeme

Posted: Wednesday, Jan 18, 2006