Published by DLC Marketing team

When it comes to shopping for a mortgage, it is important to know what you need to qualify – but it is just as important to understand some of the reasons why you DON’T qualify so that you can make some changes and budget accordingly for when the time is right.

If you are in the market for a home, make sure you know the 5 major reasons you may not qualify for a mortgage:

1. Too Much Debt

One of the biggest reasons that individuals fail to qualify for a mortgage is that they are carrying too much debt already. This debt can be in the form of credit cards, lines of credit or other loans. Regardless of where the debt comes from, it all contributes to your Total Debt Servicing ratio (TDS), which is one of the qualifiers for a mortgage loan. The goal is for your monthly debt payments to NOT exceed 40% of your gross monthly income.

PRO TIP: Find ways to lessen your expenses, budget or consolidate debt where possible.

2. Credit History

Another indicator of not qualifying for a mortgage can be your credit history. It is always important to pull your credit score before you start house hunting so that you can understand what your credit rating is to help determine what you qualify for. Your credit score is a direct reflection of your potential risk and, if you have a poor credit history then it makes it harder to secure a mortgage loan.

PRO TIP: To improve your credit score, be sure to avoid late or missed payments, exceeding your credit card limit or applying for multiple new credit cards.

3. Insufficient Assets or Income

With rising housing prices and stagnant income levels, one roadblock for mortgage approval can be lacking sufficient income or assets to put against your loan. For some buyers, the only option is to save up more money for your down payment to reduce the overall mortgage or look at suite income or alternative lenders.

4. Not Enough Down Payment

Another reason you may not qualify for a mortgage could be that you do not have enough of a down payment. In Canada, a 20% down payment is required to avoid mortgage default insurance BUT you can still purchase a home with less than 20%; you simply need to account for the insurance premiums, which are calculated as a percentage of the loan and is based on the size of your down payment.

5. Inadequate Employment History

Lastly, employment history can have a big impact on mortgage approval. Most lenders prefer a 2-year consistent employment history. If you do not have an adequate employment history, have been at your job for a short time or do not have a record of long-term positions, you might find it harder to get a mortgage loan.

Whether you’re looking to get your first mortgage, are ready to move or are simply shopping around, understanding what can impact your mortgage application will help ensure you have greater success!

If you are struggling currently with your mortgage approval or have recently been denied – that’s okay! Don’t be deterred. With a little effort and patience, as well as the support of your trusted Dominion Lending Centres mortgage expert, you will be able to put yourself in a better position to reapply in the future!  If you’re ready, contact one of our experts today to discuss your options.

Published. by DLC Marketing team

Thinking about taking a holiday this year but not sure where to go? How about checking out our own backyard! Canada has some incredible vacation locations and parks that are worth checking out:

Sunshine Coast, British Columbia: Considered a local paradise, the Sunshine Coast is a gorgeous and laidback area northwest of Vancouver with dozens of beaches. Home to several resorts and hotels, the Sunshine Coast is the perfect getaway spot! Learn more at sunshinecoastcanada.com

Whistler, British Columbia: It is not surprising Whistler would be on our list. As Canada’s most famous ski resort and a great destination, it’s a popular location! Perfect for outdoor and nature lovers, bikers and hikers and general vacationers, this is the perfect spot to adventure or relax. With dozens of hotel options, you can stay right in Whistler Village and close to the action! Learn more at www.whistler.com

The Canadian Rockies World Heritage Site: Of course, Canada is well-known for our Canadian Rocky Mountain Parks. Complete with Kootenay and Yoho National Parks, the World Heritage Site is an incredible destination. Stay in Banff, Golden, Canmore and explore the world around you! Learn more at www.worldheritagesite.org/list/Canadian+Rocky+Mountain+Parks

Banff and Lake Louise, Alberta: As some of Canada’s most awe-inspiring mountain destinations, Banff National Park and Lake Louise were sure to make their way onto our list! Enjoy electric blue glacial lakes, wildlife, waterfalls and more during your trip. With several hotels and resorts in Banff, you’re sure to find a great spot to hang your coat after your day of adventures! Learn more at www.banfflakelouise.com

Drumheller And The Alberta Badlands: If you haven’t been before, Drumheller and The Alberta Badlands are worth a visit to experience unearthly landscapes and dinosaurs!? Home of The Royal Tyrrel Museum of Paleontology, Drumheller is like stepping into the past. Stay in Drumheller and experience the incredible landscapes that the badlands have to offer! Learn more at https://traveldrumheller.com/hiking-in-the-badlands

Niagara Falls, Ontario: A jewel of Canada, Niagara Falls are very well-known and should be on every traveler’s list! With various attractions including water cruises, wineries, casinos, and more, there is always something fun to do in Niagara Falls. From entertainment and romance, this is a sure win for any traveller! Learn more at niagarafalls.ca

The Muskoka Lakes, Ontario: The Muskoka Lakes were once given the title of “Best Trips” by National Geographic and continue to remain a top destination for anyone wanting to get away! With some newly added accommodations, this once closed in location has been opened up for anyone to enjoy! From basking and boating on the lake to shopping and eating in the various villages around the area, this is sure to make for a great vacation! Learn more at www.muskokalakes.ca/en/index.aspx

Quebec City, Quebec: A beautiful location filled with our heritage, Quebec City is marked by French-Canadian character and European sophistication with incredible architecture and rich history. Famous for their delish poutine and iconic Chateau Frontenac, Quebec City is a world-famous destination for anyone wanting to soak in some culture. Learn more at www.quebec-cite.com/en

Fundy National Park, New Brunswick: We couldn’t have a top vacation locations list without including the beautiful Fundy National Park. Nestled in the beautiful Canadian Atlantic of New Brunswick, this park offers incredible outdoor opportunities from kayaking to camping. With several additional historic sites dotted around the park, there is tons to see! Stay in the Village of Alma or along the coast to maximize your experience. Learn more at www.bayoffundy.com

Cavendish Beach, Prince Edward Island: Backed by dunes and rolling hills, Cavendish Beach is the last stop on our list. With beautiful beaches and the historic Green Gables Heritage Place, Cavendish Beach is one of the best places to visit in Canada. Linger by the water and explore the town of Cavendish! Learn more at cavendishbeachpei.com

Now that you know of some of the most beautiful locations in Canada, it’s time to pack your bags and get travelling! Enjoy!

Published by DLC Marketing Team

The worst financial mistake you can make is believing that a Registered Retirement Savings Plan (RRSP) or Tax-Free Savings Account (TFSA) is something to look into when you are a little older and more able to set some money aside. The fact is, you don’t use these accounts for saving at all, you use them for investing. Your retirement fund could grow to seven figures, even if you only contribute a fraction of the allowable yearly maximums. They also come with huge tax-saving benefits.

A lot of people get discouraged by the sheer amount that you are allowed to contribute to these registered accounts and the mere pittance they may be able to come up with — don’t fall into that mindset!

If you make 60,000/year from your job, you could contribute over $10,000 to your RRSP and another $6000 to your TFSA every year. Considering you are only going to have about $45K in your jeans after taxes, finding a spare $16K would require more than 30% of your take-home pay!

The good news is that your yearly contribution limits can be carried over and as you grow older (and theoretically have more disposable income) you can catch up. The bad news is that playing catch up isn’t going to happen unless you are very disciplined with your spending. Sure, you may earn more, but you will spend more… kids, cars, vacations, even the cat is going to cost you $800/year!

That extra disposable income you were envisioning may not materialize until you are in your mid 50’s, if ever! You need to scrape together whatever investment savings you can now, even saving just 5% ($200/month) of a $60K salary would make a huge impact.

Putting off getting started is going to cost you way more than you ever imagined in lost investment returns. Ignore the pitiful interest rates you see on bank savings accounts, holding cash will actually cost you money at current interest and inflation rates. However, the average annual return on many stock indexes (S&P, TSX, DSJ) over the past 40 years is around 7%. If you do a little math, you are soon going to realize that even on a relatively small investment of $200 month, the difference between starting when you are 18 versus starting at age 28 is jaw dropping.

Investing $200/month from age 18 to 65 at 7% would give you $790,139. The same $200 at the same rate from age 28 to 65 would yield just $384,810. Sure, you would be contributing $24,000 more over that extra 10 years, but your nest egg at 65 would be double — more than enough to keep you poolside at a nice resort every winter while those late starters are stuck in the snow!

There are plenty of rules, regulations and strategies to consider and every angle of the TFSA vs RRSP debate has been extensively written about. While you do need to understand the basics of how they work, the simple goal for the vast majority of us should be to put something, anything, into one (or both) of these accounts on a regular basis and start investing — you can’t go wrong!

Published by DLC Marketing team.

It can get pretty exciting to see campaigns around “cash-back mortgages” but, before you get too far along, here are three things you might not know about these types of mortgages:

1. Occasionally you will see campaigns on cash-back mortgages, so don’t jump at the first one you see! These types of mortgages are available through a few major lenders so it can be helpful to shop around to see what different terms and conditions are available, as this will affect the overall loan.
2. When it comes to cash-back mortgages, you’re really getting a loan on top of your mortgage. The interest rates are calculated to ensure that, by the end of your term, you will have paid the lender back the money they gave you (and perhaps a bit extra!). Be mindful that these loans can come with higher interest rates and, in some cases, the extra is more than you got in cash-back.
3. The average cash-back mortgage operates on a 5-year term. While you may not be planning to move before your term is up, sometimes things happen and it is important to be aware that if you break a cash-back mortgage, you have to pay the standard penalty but you will also have to pay back a portion of the loan you were given. For example, if you are 3 years into a 5-year term, you would have to pay back 2 years or 40% worth of the cash-back. Combined with the standard mortgage penalties for breaking your term, this can add up if you’re not careful!

Before signing for a cash-back mortgage it’s better to discuss your needs with your local Dominion Lending Centres mortgage expert. They can advise regarding all cash-back mortgage availability, lines of credit, purchase plus improvement loans or also flex down mortgages that may be better for your situation.