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Three ways to secure the best mortgage rate

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Three ways to secure the best mortgage rate

While Canadians are known for their love of discounts and reward programs, many seem strangely ill-equipped when it comes to securing the best mortgage deals. 

According to a recent survey by HSBC, Canadians are the least likely among current and prospective homebuyers in 10 countries to have researched for the best mortgage rates. A mere half of respondents in Canada said they actively shopped around for deals, well below the global average of 61%. By comparison, more than 80% of French homebuyers were self-proclaimed active deal hunters. 

Far from being a waste of time, comparison shopping can save you a lot of money in the long run. And with interest rates starting to rise, it’s arguably even more important than ever to secure the lowest mortgage rate. 

Here are the three main ways to go about the process:

1. Use rate-comparison websites

Rate-comparison websites allow prospective homebuyers to compare mortgage rates from an array of lenders. Some of the most popular ones allow users to look for the rates available in their province, as well as narrow down the search by mortgage type and term duration.

It’s a good idea to replicate your search across all the major rate-comparison sites, as not all available lenders and deals are listed on all the sites. Keep in mind that some of the lowest rates you’ll see online come with strict conditions you may not meet. Also, some of the offers featured on these sites are only available through the mortgage brokers that advertize them.

2. Work with a mortgage broker

A mortgage broker is a licensed professional who compares mortgages from an array of lenders to find the best option for you. They’re a type of middleman between you and your lender. The good news is that it’s usually the lender, not you, who pays the broker his commission if the mortgage application is approved. 

A mortgage broker offers a more personalized service and will walk you throughout the mortgage process, according to Robert McLister, founder of RateSpy, one of Canada’s largest rate-comparison sites. 

Some brokers may even throw in a freebie, like covering the home appraisal fee. Also, brokers working at large, high-volume firms sometimes sacrifice a part of their commission in order to negotiate an even better rate for you, McLister said. This can shave between 0.15 and 0.20 percentage points off your mortgage rate. 

3. Negotiate with your bank

Walking to your bank’s local branch to negotiate a mortgage sounds easy enough. However, it could cost you dearly if you haven’t done sufficient research. 

To get the best deal, shop around for the best rate and term from different lenders. Then, take that to your bank to see if they will match your target rate. Keep in mind that a print-out of rates from a rate-comparison website might not be enough to get you the deal you want, as your bank may not be willing to budge unless you can prove that you can really get that rate. 

Counter this by showing up at your bank with a written commitment from one or more lenders. The risk, though, is that too many credit inquiries could damage your credit score.

 

Are you looking to invest in property? If you like, we can get one of our mortgage experts to tell you exactly how much you can afford to borrow, which is the best mortgage for you or how much they could save you right now if you have an existing mortgage. Click here to get help choosing the best mortgage rate


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Victoria real estate agent disciplined for false advertising, encouraging cash deal to avoid taxes

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A Victoria real estate agent is facing $9,000 in fines and a 60-day licence suspension after breaking several professional rules during the sale of her father’s half-million-dollar property, according to a decision by the Real Estate Council of B.C. 

Whitney Garside’s missteps — outlined this week in a disciplinary decision posted on the council’s website — included falsely advertising the property as being almost twice its actual size and advising the buyer they could avoid the property transfer tax if they paid cash directly to the seller.

The property on Burnett Road in Victoria was being sold in 2016 by the real estate agent’s father. That relationship was disclosed and isn’t among the reasons she has been disciplined.

According to the disciplinary consent order, Garside told the buyer — whose name is redacted — that by paying $42,000 cash on the side, the value of the property could be reduced to avoid paying the property transfer tax.

That cash arrangement was not shared with Garside’s brokerage, Re/Max Camosun, a failure that contravened the Real Estate Services Act.

The council also ruled that she “failed to act honestly and with reasonable care and skill” when she advised the buyer the property transfer tax could be avoided by paying cash directly to the seller. 

The council’s discipline committee also found that Garside committed professional misconduct when she failed to recommend the seller and buyer seek independent legal advice, specifically regarding the property transfer tax and the cash agreement.

Another issue the council considered professional misconduct involved the size of the property in question.

The council ruled that Garside published false and misleading advertising and failed to act with reasonable care and skill when the property was advertised as 8,712 square feet, when in fact a portion of the lot belonged to the Ministry of Transportation, and the actual size was just 4,711 square feet.

The discipline committee ordered Garside’s licence be suspended for 60 days, which will be completed Jan. 3, 2021.

She has also been ordered to complete real estate ethics and remedial classes at her own expense.

Garside was also fined $7,500 as a disciplinary penalty and $1,500 in enforcement expenses.

She agreed to waive her right to appeal the council’s discipline committee’s decision in September.

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Frisco apartment community sells to Canadian investor

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A Canada-based investor has purchased a Frisco apartment community as part of a larger Texas deal.

The 330-unit Satori Frisco apartments opened last year on Research Road in Frisco.

BSR Real Estate Investment Trust bought the four-story rental community that was built by Atlanta-based Davis Development.

Satori Frisco was more than 90% leased at the time of sale. The property includes a two-story fitness center, a car care center, a dog park and a resort-style swimming pool.

The Frisco property sold along with Houston’s Vale luxury apartments in a deal valued at $129 million.

“BSR recently exited the smaller Beaumont and Longview, Texas, markets and also sold noncore properties in other markets,” John Bailey, BSR’s chief executive officer, said in a statement. “We are now using our strong liquidity position to invest in Vale and Satori Frisco, modern communities in core growth markets with the amenities our residents desire.”

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House prices on Prince Edward Island continue steady climb

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Residential real estate prices on Prince Edward Island continue to climb at a rate higher than the national average, according to the latest report from a national organization. 

The Canadian Real Estate Association released monthly figures for November 2020 on Tuesday.

They show that the average price for a resale home on P.E.I. is about 21 per cent higher than it was a year earlier. 

Only Quebec had a bigger year-over-year increase, at about 23 per cent. Overall across Canada, prices were up 13.8 per cent year over year in the ninth month of the COVID-19 pandemic.

“For the fifth straight month, year-over-year sales activity was up in almost all Canadian housing markets compared to the same month in 2019,” the report noted.

“Meanwhile, an ongoing shortage of supply of homes available for purchase across most of Ontario, Quebec and the Maritime provinces means sellers there hold the upper hand in sales negotiations.”

That lack of houses coming onto the market compared to the demand means that in those provinces, there is “increased competition among buyers for listings and … fertile ground for price gains.”

There have been anecdotal reports for months that Prince Edward Island’s low rate of COVID-19 infection and looser rules around social activities have been encouraging people to buy homes on the Island. 

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