FINANCIAL RESPONSIBILITIES OF HOME OWNERSHIP

Yay!  You’ve bought your first home. Exciting and overwhelming at the same time. A bitter sweet feeling.  You have that feeling of relief now that you have finally purchased your new home but be aware that financial responsibilities of home ownership is just the start.

Pay your mortgage on time

Whether monthly, biweekly or weekly, be sure that you always make your mortgage payments on time. Making late payments (delinquency) may result in late charges and negatively affect your credit rating. Failing to make payments can even lead to more serious consequences like foreclosure. A good way to prevent late payments is to have the amount automatically deducted from your account every month and to put at least three months’ worth of mortgage payments in savings for emergency situations. If you are having trouble making payments, discuss the situation with your lender.

Saving For Emergencies

Even if you are a contractor, repairs come at a cost. Every building has a life cycle, which means that all parts of a building age and require major repairs or replacement at some point. For example, you might know that your roof will have to be replaced in a few years simply because of its age. Repairs like these are expected and can be planned for. However, many repairs are unexpected and can sometimes be costly. Set aside an emergency fund to deal with unexpected problems ranging from major repairs to illness and job loss. A healthy guideline is saving 5% of your take-home pay and putting it in a special account.

Living Within Your Budget

Prepare a monthly budget for your home and stick to it. You should monitor your bills every month and evaluate your progress in meeting your financial needs. If you continue to spend more than you are bringing in, you must find ways to cut back. If you are having trouble sticking to your budget, don’t hesitate to ask a financial advisor for assistance.

For all your real estate needs I am more than happy to help you and the people you refer to me. Call 647-308-5148 and if no answer, send a text and I’ll be sure to reply!

Makini Smith

Sales Representative

RE/MAX First Realty Ltd., Brokerage

www.makinismith.com

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MOVING CHECKLIST ADD ONS

Making a move of any kind can be hectic and stressful. Moving homes can sometimes feel like moving mountains, having so much to do and not knowing where to start. Having a to do list to keep organized can help alleviate some of the stress and having a moving check list can save you from forgetting some extremely important steps along the way. Here are a few things that you may not have on your list to make the experience go smoothly:

1.       Notify everyone about your change of address. The post office offers a temporary forwarding service in case you forget some companies/bill collectors. You will need to update family, doctors, dentist, subscriptions, government offices, bank, etc.

2.       Cancel deliveries for your local paper and any other services that cannot be transferred to the new address.

3.       Disconnect utilities and notify where to send the final bill. The hydro company or hot water tank rental should be on the top of the list. Phone, cable, gas, electric, and any others should be checked to make sure you receive your refund for any deposits made.

4.       Be sure to leave extra keys on the counter for the new occupants. If you kept appliance manuals leave those as well.

5.       Obtain school records for the children if they will be making a transfer to a new school district.

6.       Have the car tuned up for the trip. The extra loads and mileage is hard enough on your vehicle, the last thing you need on moving day is a car that won’t start.

7.       Confirm with the lawyer that you have followed all instructions for closing day. Missing documents or not completing necessary instructions can lead to costly delays.

8.       Don’t forget to clean up after it’s all said and done. Be considerate and don’t leave a mess behind.

Saying goodbye to one home and neighbourhood and discovering a new one can be very exciting. Just make sure it is not hectic as well. You will want to plan ahead to make the transition as smooth as possible for everyone involved. That way, you can breathe easy and enjoy your new home without having to worry so much. If you’re not sure and have questions, I’d be more than happy to help. Contact me for all your real estate needs. Call 647-308-5148 and if no answer send a text and I’ll be sure to reply!

Makini Smith

Sales Representative

RE/MAX First Realty Ltd., Brokerage

www.makinismith.com

HOW YOUR CREDIT EFFECTS GETTING A MORTGAGE

The Importance of Your Credit Rating to obtain a Mortgage

So you want to buy a home? Well first you will need to be approved for a mortgage. Before approving you for a mortgage, lenders will want to see how well you have paid your debts and bills in the past. This is something that isn’t taught enough in my opinion. The importance of paying your bills on time and not racking up all kinds of debt should be taught more in schools and by parents. Far too many people have to learn these valuable lessons though the School of Hard Knocks.

Lenders for a mortgage simply get a copy of your credit history (credit report) from a credit bureau to check these things. This provides them with information on your financial past and use of credit. Before your lender sees your credit history, you should get a copy for yourself to make sure the information is complete, accurate and worth applying for a mortgage. Simply contact one of the two main credit-reporting agencies (Equifax Canada Inc. or TransUnion of Canada) to get a copy of your credit report. There is often a small fee for this service.

Lack of Credit History

If you have no credit history, it is important to start building one by, for example, applying for a standard credit card with good interest rates and terms, making small purchases and paying for them as soon as the bill comes in.

Fixing a Credit Record

If you have bad credit, lenders might not want to give you a mortgage loan until you can re-establish a good credit history by making debt payments regularly and on time. Most unfavourable credit information, including bankruptcy, is dropped from your credit file after seven years. If you have bad credit, you may want to consider credit counselling.

Despite your poor credit history, you might still be able to get a mortgage loan if you have a relative such as a family member willing to be a guarantor or co-signer on the loan. This person must meet the lender’s borrowing criteria, including good credit history, and is legally obligated to make the mortgage payments if you do not.

The six “C’s” of credit

1. Capacity
2. Capital
3. Collateral
4. Character
5. Credit History
6. Common Sense

Your credit report is crucial not only for getting a mortgage when purchasing a home, but so many other areas in your life. Even if it’s just the minimum payment, always pay your bills on time. To get connected to a mortgage broker nearest you for a pre approval or credit counselling contact me today!

Makini Smith

Sales Representative

RE/MAX First Realty Ltd., Brokerage

www.makinismith.com

REGULAR HOME MAINTENANCE AND REPAIR

By doing regular maintenance to your home and taking care of small repairs right away, you’ll avoid the more expensive unnecessary costs later on. One of the best things you can do is to get to know your home as best as possible. Wishing I had decided to do so sooner than later, but a lesson learned after a recent flood in my home due to the ice storm of December 2013. Knowledge is power and sharing is caring so here are some things I feel you need to know:

• Your home is made up of various components that work together. These include mechanical systems (heating, air conditioning and ventilation) and the building envelope (foundations, floors, walls, windows, doors and roof).

• You need to learn enough about the major mechanical systems of your home to be able to perform routine maintenance and handle various emergencies.

Every adult member of your household should know the location of and how to operate the following:

– Main shutoff valves for water and fuel (oil or natural gas);

– Emergency switch for the furnace or burner;

– Hot water heater thermostat and breaker;

– Main electrical switch;

– Fuse box or circuit breaker box.

• Renovations targeted at increasing energy-efficiency may affect appliances venting by a chimney. Check chimney performance if you tighten the envelope or add exhaust fans. Remember that homes, like people, get old. Just as we require regular checkups as we age, It’s a good idea to inspect your home regularly and replace or repair parts and materials that wear out with use and time. And remember that since different components of your home work together and affect each other, minor repairs can quickly become major ones if they are not taken care of quickly.

You will probably be able to do many of the repairs yourself. If I can do it, trust me you can too! However, if you feel it’s too complex of a job to handle on your own, it is best to call an expert. Feel free to contact me for a list of referrals. It’s not too important who carries out the repair, just remember that the work has to be done correctly. Bad materials and poor workmanship will end up costing you more in the end and devalue your home.

Makini Smith

Sales Representative

RE/MAX First Realty Ltd., Brokerage

www.makinismith.com

IS HOME OWNERSHIP FOR YOU?

Buying a home is one of the biggest emotional and financial decisions you’ll ever make, so prepare yourself to make a knowledgeable decision. When we know better, we do better. Do your research and make informed decisions.

Although buying a home almost always seems like a great idea, it is important to understand what homeownership involves. Being a homeowner is a proud accomplishment but it also means having to invest money, time and energy and take on added responsibilities. So, before you decide to buy a home, make sure you’re ready.

Here are some things to consider:

• Financial Security. If housing prices rise, your home can provide you with some financial security due to capital appreciation. The equity built in your home can be taken out or used as a secured line of credit.

• Stability. Having a place of your own gives you a sense of permanence as opposed to the displacement some renters feel. There is security in knowing the home belongs to you.

• Financial Load. Coming up with the down payment, meeting regular mortgage payments and other ongoing costs will tie up a lot of your cash, and can put considerable stress on your finances. On a positive note, you are building your own equity which can’t be done through renting.

• Maintenance. Keeping your home in good shape requires time and money. Pride in ownership can be cashed out when it’s time to sell. A well kept home is most appealing to buyers.

• Responsibility. You alone are responsible for payments, repairs and maintenance. But this gives control, power, and leadership to do as you wish (within legal boundaries).

• Flexibility. You can decorate or renovate your home to meet your own family’s personal tastes and needs. Most condos may have restrictions on color of window coverings, pets, noise, etc.

Now that you have an idea of what to expect, it’s important to work with someone that understands homeownership is not for everyone. To find out if owning a home is right for you, contact me at 647-308-5148. If busy, send a text!

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HIRE A PROFESSIONAL

A fish is an expert at swimming. A bird is an expert at flying. A realtor is an expert at buying/selling homes.  The internet has the world believing they are experts at everything. The Do-It-Yourself era has made people forget the need for experts. You wouldn’t cut your own hair or perform your own surgery. You’d have the job done by a professional. So when it comes to real estate, there are many reasons to hire a professional.  Some benefits include but are not limited to:

·         They provide and assist with the legal paper work necessary. Disclosures, legal forms, contracts and laws that must be followed to avoid lawsuits frequent in the real estate industry. A realtor is insured to protect against errors and omissions.

·         They are educated and experienced in the entire sales process. They view homes every day so they can easily determine market value. Preventing sellers from over pricing due to sentimental value and sitting on the market, and buyers from purchasing an overpriced property.

·         They act as a buffer between all parties in negotiations. Sellers want top dollar. Buyers want to pay the lowest price possible. A professional realtor helps the two come to a compromise so all parties walk away satisfied.

·         They get your home maximum exposure. From lawn signs, inter office promoting, multiple listing service, and many other powerful tools available to realtors.

·         They screen the tire kickers. A realtor pre qualifies a buyer before showing them homes. They have a copy of their ID and know their financial status. Selling your own home subjects you to endless calls and unannounced visits.

A real estate sales professional is paid solely based on their efforts, so they only get paid once the job is complete. Getting the job done to your satisfaction is the main objective. If the deal doesn’t close no one is happy. Why not leave the hard work for the professionals

Makini Smith

Sales Representative

RE/MAX First Realty Ltd., Brokerage

www.makinismith.com