Thursday, January 29, 2009

A Primer for dealing with your bank

This one hits close to home because this happened to us here at Your Mortgage Matters this month. Just more reason to use an unbiased professional advisor - whether it is for your mortgage, investments or what-have-you.


Banks and other financial companies are introducing new fees and raising interest rates.


Banks say they're paying more to raise the funds they lend out, and they're worried about loan losses in the recession.


Toronto-Dominion Bank has introduced a $35 inactivity fee for people who don't use their unsecured lines of credit over a year.

Bank of Montreal drops their mortgage rates but raises unsecured line of credit rate by 1% on a customer who carries a balance (earning the bank profit) and pays on time for years.


New fees and charges mean new reasons to look at other big banks, alternative and online banks and credit unions.


You're not married to your bank. It's okay to play the field.
Use an independent advisor - don't just go running to your bank because they only have their own best interests in mind.

Wednesday, January 28, 2009

Canada's Mortgage Industry Welciomes Federal Budget Announcements

Yesterday, federal Finance Minister Jim Flaherty tabled the federal budget. Several measures affect Canada's housing and mortgage industry.

  • Temporary home renovations tax credit of up to $1,350 for eligible home renovations and alterations

  • Increase in the home buyers RSP plan, withdrawal limit increased to $25,000 from the current $20,000

  • A new first time home buyers tax credit that will provide up to $750 in tax relief for closing costs

  • Broad based personal tax reductions including an increase in the personal exemption and increases to the limits for the two lowest tax brackets

  • Make sure you stay tuned to the Your Mortgage Matters Blog for up to date information on these and other important topics in the coming days.

    Tuesday, January 27, 2009

    Why hire a professional Renovator/Contractor ?

    Your Mortgage Matters is proud to have another guest post-er today. Gary Round from Gary's Home Improvements has some excellent reasons why you should hire a professional contractor when it comes to renovations.

    Why should you hire a professional renovator? For piece of mind to start with. Also the job will be done once and done right!

    A contractor or any renovator should give you some sort of a signed contract so that if a problem does occur he or she would return to fix the problem. There continue to be many large, do-it-yourself box stores (and you know who they are) opening in all areas. They are big on “buy are products and we can show you how to do it” . Well, that may be correct for some of the little easy to do things but for a lot of them you really need a professional’s experience and knowledge.

    Beware of certain “slogans” ... there are some examples listed below:

    “We happened to be in your neighbourhood.”

    Be wary of anyone who comes knocking at your door looking for work! Driveway paving and roofing companies may solicit business this way, but make sure you check the company out thoroughly before agreeing to have any work done. Never hire anyone who says the offer is only good if you sign up right now, or who can’t provide references. Homeowners and reputable contractors agree: the best way to hire someone is by word of mouth.

    “We require payment in full before we start work.”

    Any pressure tactics to make the full payment or a larger than normal deposit before work begins should set off alarms, even if the contractor claims they need the money to buy materials. A reputable contractor won’t need to pay for materials in advance because he’ll have an account with his regular suppliers. The Canadian Home Builders’ Association (CHBA) recommends a prepayment of 10 to 20 percent of the total price.

    “We can offer a special deal if you pay cash and we skip the paperwork.”

    While it can be tempting to save money on your renovation by paying cash, always get an agreement in writing. The contract protects you from certain liabilities, and proves what you and the contractor have agreed to in terms of the scope of the work, the work schedule, warranty and the price and payment schedule. You should also steer clear of any contractor who can’t justify why his quote is much higher or much lower than the others. A very low price may leave you liable for accidents, injuries or damages caused on the job.

    "Custom made" or "custom size.”

    While sometimes you will do a custom job—to create the kitchen of your dreams or a built-in cabinet in an oddly shaped nook—the word “custom” usually means dollar signs.

    Here are a couple of other warning signs to watch out for:

    Lies about business records and insurance. Before you meet them, check your potential contractors out with the Better Business Bureau and your local Home Builders’ Association to see if anyone has lodged a complaint against them. If they aren’t registered with at least one of these, cancel the meeting. During the meeting, be sure to ask about their record, as well as proof of Worker’s Compensation coverage and Contractor Liability insurance.

    Not asking any questions at all. A good contractor should listen to what you want, but also tell you what you need and ask about things you may not have considered. He should bring to the table expertise about how best to do the job, where you might be able to cost-share, and what you need in terms of permits or permission from the neighbours.

    Actions speak louder than words. Your prospective contractor may be a fly-by-night operation if the quote he gives you is printed on plain paper instead of letterhead, if it doesn’t have an itemized breakdown of all costs involved in the project, or if he hasn’t bothered to spend the nominal fee to put the company name on his truck.

    So to finalize, when asking yourself why you should hire a professional renovator ... keep your radar on and your ears open for anything that just doesn’t sound right. Be a smart, informed consumer and never let your lack of knowledge of the industry, deter you from investigating further or asking questions. A contractor might suggest you cut corners or try a temporary solution, but in the end, you’ll be the one left footing the bill to get the job (finally) done right.

    Gary Round is a renovator/contractor and operates Gary's Home Improvements. He is the president of his local chanpter of CARAHS and a board-member of the Durham Home and Small Business Association You can reach him at 905-668-8898 or by email:

    Monday, January 26, 2009

    Inflation hits 2 year low

    Your Mortgage Matters wants to start your week off with some good news ! Check with your mortgage professional for some great news today on low interest rates.

    Just when you need to hear it most - in the middle of a cold snap with economic woes and uncertainty ... you heard it right: Inflation hits a 2 year low.

    In fact if not for a spike in the price of some food items the rate would actually be zero! Falling gas and energy prices were countered by rising foodstuffs (fresh vegetables, bakery and cereals all up substanitally) in the December 2008 stats.

    Our island neighbours in P.E.I. actually rang up a zero with New Brunswick and Nova Scotia recording decreases of 0.6 and 0.2 per cent respectively. Statistics Canada confirms that the annual rate decreased to 1.2% for the end of 2008 which is a low not experienced since the beginning of 2007.

    Month over month November '08 to December '08 prices were 0.7 per cent lower.

    Even with these amazing figures, Canada's inflation rate comes in at about 1% above that of the U.S.A. but our weaker dollar and good wage gains by those keeping their jobs makes deflation less of a risk.

    The Bank of Canada recently forecast inflation will likely drop below zero in the 2nd quarter once food prices react to the drops in energy and commodity prices. The Bank's "core inflation rate" which excludes energy and many food products due to their volatility remained at 2.4% last month.

    Sunday, January 25, 2009

    Low debt-load will help us weather recession

    It can't save us from recession, but it will certainly reduce the pain. Canada's low debt burden - among governments, businesses and households alike - gives the country a crucial advantage as it heads into what threatens to be a long haul.

    Backed up by stability in the banking system that has become the envy of many countries, the Canadian advantage is solid enough that even the global recession and financial crisis can't destroy it.

    "The advantage is fundamental. It's not cyclical," said Sherry Cooper, chief economist at BMO Nesbitt Burns. "Nobody can take away the fact that Canadians are far less burdened,".

    At the heart of the global recession is the fact that the U.S. government, financial institutions, households and companies lived way beyond their means for a long time. The effects of too much debt are being felt everywhere.

    But since Canada's governments, financial institutions, households and companies aren't facing the same high debt problems, the country doesn't have to fix those problems to muddle through.

    "So much of what is happening in the United States is because of the credit freeze. There's no comparison here. Canada is in a far better condition," Ms. Cooper said.

    Bike courier André Régimbald can feel it. He navigates Ottawa's icy downtown streets daily, even when it's -30, and embraces the challenge with a thick balaclava and a grin.

    He's confident - even as local messenger firms duke it out for dwindling business and he doubts some of his newer colleagues will make it through the winter with their jobs intact - that his salary will continue to flow as usual.

    "It's not really bothering me," said Mr. Régimbald, 47. He's pretty sure he won't lose his job, and if he does, he knows how to find another one.

    Canada is in better economic shape to handle the global recession than most other countries, and compared with previous recessions. Like the courier smiling thinly, through a missing front tooth, the hardy Canadian economy is well prepared to tough it out, even as the harsh winter of the U.S. recession sets in.

    The Canadian economy can't go so far as to claim it's not being "bothered" by the global recession. After all, it is contracting, too. The pain is mounting in many industries, and the ranks of the unemployed are growing. Recovery is a long way off.

    But Canada's reduced exposure to the unseemly debt loads at the heart of the crisis will stand us in good stead, economists say.

    The most obvious Canadian advantage is government debt load. After fighting down the deficit in the 1990s, the federal government has been able to pay off more than $100-billion in debt in the past decade, and most provinces have vastly improved their books as well.

    Not so in the rest of the world. The U.S. deficit has ballooned and Japan's is enormous. While most European countries have kept their debts under control, Canada's total debt burden is still lower. As Ottawa and the provinces ready themselves to spend billions in an attempt to mitigate the recession, Canada can well afford to do so.

    "The debt [burden] gives us lots of room to manoeuvre. This is the time to raise it," said Andrew Sharpe, executive director of the Ottawa-based Centre for the Study of Living Standards. "We've built up this big advantage, so let's use it. But wisely.

    "The Canadian banking sector has also gained international recognition for its ingrained conservatism. While major banks around the world have toppled and have required government bailouts, Canadian banks remain somewhat profitable and well capitalized. Unlike their global competitors, they are still lending, and are able to raise money in financial markets, albeit at steep prices.

    The corporate sector, as a whole, has been equally thrifty and conservative. Debt levels are low, and companies generally have high cash balances at the ready - useful for plugging holes due to sudden collapses in revenue that could well hit in the next few quarters.

    As corporate income surged over the past few years, economists were worried that Canadian companies weren't putting their newfound bounty to good use, by leveraging it for further expansion. Now, the companies' tight fists seem to be paying off.

    The lack of available credit in the United States is forcing debt-addicted companies to de-leverage, pummelling stocks and causing massive layoffs. In Canada, companies aren't as needy of credit. While stocks are plunging here and layoffs have begun, the carnage is not as deep or widespread.

    Canadian consumers have shown a similar conservative attitude toward debt. While U.S. homeowners were using their houses as ABMs, and buying homes with spurious loans, Canada also experienced a housing boom and embraced the U.S. practice of borrowing against our houses to finance consumption.

    But mortgages here were not nearly as high risk. Housing prices are now falling, but not to the extent as in the United States or Britain."We are leveraged, but they are more leveraged," said Benjamin Tal, senior economist at CIBC World Markets. "If you want to feel good about yourself, just look south of the border.

    "There, falling home prices and the rising cost of credit mean many homeowners' mortgages are now bigger than the value of their homes. That hasn't happened in Canada. Plus, Canadians are generally not as exposed to the stock market as in other industrialized countries, so the negative wealth effect that many Americans are experiencing right now is not as severe in Canada.

    But there's a serious crack in the tough Canadian outer shell. The savings that Canadians have used in the past as protection against hard times are no longer there. With the savings rate hovering near zero over the past few years, that buffer is gone, Mr. Tal says.

    Since consumer debt levels have risen, savings have dwindled, and credit is harder to get, "we are clearly as vulnerable, in terms of the position of the economy, as we were in [the last recession in] 1991.

    "Plus, the safety net for those vulnerable people is not nearly as strong as it used to be.

    Bike courier Mr. Régimbald is a case in point. He has no savings. And while he's certain he won't spend any time being unemployed, if he's wrong, he's not covered by employment insurance.

    "The changes to employment insurance over the years have just been Draconian," said Ken Battle, president of the Ottawa-based Caledon Institute for Social Policy. "It's been reduced to rubble."

    Only 43 per cent of unemployed people were covered by EI in 2007, compared with about 80 per cent in the 1990s, he said. Regional variations are striking, with only 32 per cent of Ontario's unemployed people receiving coverage. Women are less likely to be covered than men.

    And the backup plan for people with little income - provincial welfare programs - is notoriously meagre and archaic, Mr. Battle added.

    Still, the federal government has been made aware of the shortcomings of the EI program, and is poised to make changes in next week's budget.

    G7 debt to GDP ratios

    Canada has a much lower government debt per capita than other G7 countries


    Canada: 22%
    Britain: 33%
    France: 36%
    Germany: 43%
    U.S.: 46%
    Italy: 87%
    Japan: 88%


    Wednesday, January 21, 2009

    Realtors call on federal government to stimulate housing mrket

    Published January 15, 2009 CREA

    The Canadian Real Estate Association is calling on the federal government to include several housing initiatives in the upcoming budget. The association believes the proposals are even more important in today's recessionary times, based on the impact housing has on the overall economy and the reported results of MLS residential sales in 2008.

    "Bay Street needs to take a back seat to Main Street in the next federal budget," says the President of The Canadian Real Estate Association, Calvin Lindberg. "The government has already moved to help credit markets and our chartered banks, now it's time to take direct and immediate action to help ordinary Canadians."

    Statistics released today by the CREA show that the residential housing market sales volume withdrew in 2008 to levels not seen since 2002. More importantly, the most recent statistics from December 2008 show that sales activity reached its lowest level for the month of December since 2000. Some 434,477 homes traded hands via the MLS systems of real estate boards in Canada in 2008, down 17.1 per cent from the record 523,855 properties sold in 2007.

    "We are pleased the Minister of Finance and the government have recognized the need for action by ranking housing as one of the top six issues in its pre-budget consultations," Mr. Lindberg added.

    CREA has met with senior government officials and proposed several measures to help stimulate the housing market, both for residential and commercial investors.

    For residential homebuyers, CREA proposes the government increase the limit of the Home Buyers Plan (HBP). Introduced in 1992 by a Conservative government and made permanent by a Liberal government in 1994, the HBP has broad political and consumer support.

    The HBP allows first time homebuyers to withdraw up to $20,000 from their RRSP to help purchase a residential property, which must be repaid over a period of 15 years.

    Unfortunately, the HBP has not kept pace with inflation or home prices. As a result, the HBP does not have the same impact and relevance it did 16 years ago, when $20,000 represented 13.3 per cent of the average house price, versus about 6.5 per cent today.

    "The government should immediately raise the HBP limit from $20,000 to $25,000 and it should keep pace with annual inflation. Additionally, it should be available to all home buyers, not just first time buyers," the CREA President added.

    To address issues facing the commercial and investment property markets, CREA is seeking amendments to the Income Tax Act to promote increased reinvestment in real property. The CREA proposal calls for the deferral of capital gains taxes and the capital cost allowance recovery for all real property investments when an investment property is sold and the proceeds are re-invested in another real property within the subsequent year.

    "Our proposal has benefits across the board for the economy, for rental housing and for the small investor, as well as some significant environmental benefits as old buildings are renovated and made more energy efficient. The budget is the perfect time for this sort of stimulus," Calvin Lindberg added.

    Studies show that more than 29 jobs are created for every $1 million invested in property renovation. A study prepared by Altus Clayton for CREA also shows that each residential MLS transaction generated an additional $32,200 in consumer spending. Commercial and investment property transactions can generate even higher levels of economic spinoffs.

    Canada Mortgage and Housing Corporation (CMHC) reported that rental construction is not growing fast enough to offset demand. At the same time, the Ontario Housing Supply Working Group has found that tax changes, such as the proposed rollover, "will not only lower the rent threshold at which a new project will be supply will help reduce demand pressures and...increase the supply of vacant units in existing stock."

    CREA's proposed deferral and reinvestment will help the small investor disproportionately. Research based on the 2006 tax year indicates that 58 per cent of those reporting real property gains had net incomes of $50,000 or lower.

    CREA's detailed proposal for the Home Buyers Plan is available on

    CREA's capital gains proposal is also posted on

    A podcast with CREA President Calvin Lindberg is also available on

    Tuesday, January 20, 2009

    Bank of Canada Rate Drop

    Here's some news from today's headlines ... good news for many however the lower rates also mean a dropping value in the loonie for those travelling south this winter. Don't forget to talk to your independent mortgage professional regarding interest rates and products best suited for your situation.

    Bank's key rate cut to record low

    OTTAWA - The Bank of Canada has chopped its key interest rate by another half percentage point to its lowest level ever, and warned that the Canadian economy will contract by 1.2 % this year.

    The central bank's target for the overnight lending rate now stands at 1% - lower than in 1958, when the most-watched policy rate was 1.12 per cent.

    "The outlook for the global economy has deteriorated since the bank's December interest rate announcement, with the intensifying financial crisis spilling over into real economic activity," the bank said in its gloomiest statement yet.

    In separate announcements, Toronto-Dominion Bank and Bank of Montreal
    responded by announcing they have cut their prime lending rates by 50 basis points to 3 per cent. BMO said it is cutting key mortgage rates by 30 to 50 basis points.

    Last fall, the bank had counted on the Canadian economy growing by 0.6 % this year. But since then, it has recognized that Canada is in recession, and now says the economy will shrink by 1.2 per cent in 2009, as the country succumbs to sagging global demand, lower energy prices and a collapse of confidence around the world.

    "Canadian exports are down sharply, and domestic demand is shrinking as a result of declines in real income, household wealth, and consumer and business confidence," the bank said.

    Already down in overnight trading, the Canadian dollar fell further after the bank's announcement, and was down 0.84 cents U.S. to 78.90 cents just after 9 a.m. ET.

    Since slack is building up in Canada's economy and housing prices are coming down modestly, inflationary pressure should also ease, the bank explained.

    Total inflation will likely fall below zero for much of 2009 because of lower energy prices. And even core inflation, which excludes energy and other volatile items, will drop to about 1.1 per cent at the end of this year, the bank said.

    But the central bank sees a remarkably strong recovery in 2010, with the Canadian economy growing 3.8 per cent next year and inflation edging back up to hit the bank's two per cent target in early 2011.

    In order for the recovery to take hold, the global financial system has to stabilize, the bank said, but added that that process has begun, "There are signs that these extraordinary measures [by governments and central banks] are starting to gain traction, although it will take some time for financial conditions to normalize," the statement said.

    Plus, the global economy should start to benefit from "considerable" monetary and fiscal stimulus, the bank said.

    Canadian banks have come under criticism for failing to pass on to customers the full amount of recent previous rate cuts by the Bank of Canada.

    Canada's recovery should also be bolstered by the past depreciation of the Canadian dollar, the statement added.

    The bank did not promise any further interest rates to follow. Instead, the bank pointed out that it had already reduced its key rate by three and a half percentage points since December 2007, and added that it would keep an eye on how the economy and markets develop, and decide accordingly what it should do with rates.

    "Guided by Canada's inflation-targeting framework, the bank will continue to monitor carefully economic and financial developments in judging to what extent further monetary stimulus will be required," it said.

    Economists have warned that central banks need to be prepared to quickly reverse their aggressive interest rate cuts of the past year as soon as they see signs of recovery. Otherwise, there is so much monetary and fiscal stimulus floating around that today's disinflation could easily turn into an inflation problem when economies begin to grow again.

    Economists have also been on the lookout for alternative forms of boosting the economy, aside from interest rates, with the U.S. Federal Reserve's key rate already hovering around zero, and the Bank of Canada at its lowest level too.

    While Bank of Canada Governor Mark Carney has said previously that he is
    examining his options, there was no suggestion in Tuesday's statement that any non-conventional measure is imminent.

    Still, with the federal budget just a week away, the government is expected to introduce several easing mechanisms, as well as a huge stimulus program to help ease the bite of the recession.

    The Bank of Canada will issue a more complete economic outlook on Thursday.

    Monday, January 19, 2009

    Real Estate industry seeks jump-start

    From Friday's Globe and Mail
    January 15, 2009 at 8:30 PM EST

    The real estate industry wants the federal government to bolster the housing market, as it bids goodbye to a bleak 2008 and braces for an even tougher year ahead.

    The Canadian Real Estate Association (CREA), a trade organization representing real estate agents, is asking the government to broaden the Home Buyer's Plan, which allows some home buyers to withdraw RRSP funds for their purchases.

    "The government has already moved to help credit markets and our
    chartered banks, now it's time to take direct and immediate action to help ordinary Canadians," said CREA president Calvin Lindberg in a statement.

    CREA is asking Ottawa to raise the limit on RRSP withdrawals by first-time home buyers by $5,000, to $25,000, and extend the program to anyone buying a home. In addition to first-time buyers, the withdrawals are now permitted to those buying or building homes for related people with disabilities.

    Economists declared the housing boom dead last year, as weakness that started the year before in Alberta spread across the country.

    Existing home sales were at the lowest level in six years in 2008,
    according to CREA statistics released Thursday. The average home price declined slightly year-over-year to $303,594, and is expected to further erode in a trend that also began in mid-2008. The picture got darker toward the end of the year, with prices falling by 10 per cent year-over-year last month, and sales to their lowest level for a December in eight years.

    "With job losses accelerating late last year, sales activity will likely remain under pressure, while the imbalance of listings relative to sales should keep prices in correction mode. All told, 2009 is shaping up to be another difficult year in the Canadian housing market," said Robert Kavcic, economic analyst at BMO Nesbitt Burns Inc.

    In a recent report, the Conference Board of Canada said it expects home prices to slide by 10 per cent in 2009, a forecast that was in line with economists' estimates. In context, the average value of a resale home surged nearly 80 per cent in the six-year period ending in 2007.

    The market for new homes has also been weakening, and both price growth and new building intentions are slowing. For 2009, the CMHC's outlook is for 177,975 starts, with construction expected to fall dramatically before staging a mild recovery in 2010.

    In a measure of how the market is getting tougher, one Vancouver developer has decided to slash prices on inventory that has been selling at a sluggish pace.

    The Onni Group said Thursday that it will cut prices by up to 40 % on 375 unsold units at seven completed condo developments in the Vancouver area, in a one-day "liquidation" sale that will take place on March 7.

    The company decided the financial benefits of selling at reduced prices outweighed holding the units over the longer term, said Chris Evans, executive vice-president at Onni. The developer wants to free up funds to take advantage of opportunities when the market picks up, Mr. Evans added.

    Looking for ways to stimulate the economy during the downturn and offset job losses in construction, which totalled 44,000 in December alone, the Harper government has been floating the idea of a tax credit for home renovations in the Jan. 27 budget.

    The CREA initiative may face a tough time winning over policy makers. In fact, the Canadian housing market probably doesn't need the help, said Benjamin Tal, economist at CIBC World Markets Inc.

    "Because this is a measured correction rather than a U.S.-style meltdown in the housing market, there is no urgent need to fix it. In an economic recession, we need to allow the housing market to balance itself in order to emerge on a more solid foundation."

    Saturday, January 17, 2009

    Plan offers tax credit for home renovations

    From Thursday's Globe and Mail
    January 15, 2009 at 4:00 AM EST

    OTTAWA - The Harper government has been floating the idea of a tax credit for home renovations - an idea that could deliver significant stimulus for Canada's residential construction industry in the Jan. 27 budget.

    Deliberations continue as Canada's premiers meet today in Ottawa to put the final touches on a budget request for Prime Minister Stephen Harper - one that sources say will include more cash for employment training, more benefits for the jobless and extra funding for infrastructure.

    Finance Minister Jim Flaherty, meanwhile, has been conducting his own consultation on the looming budget, expected to deliver up to $30-billion in stimulus to soften an economic downturn.

    During a closed-door session in Montreal last week, Mr. Flaherty asked participants' opinion on a partly refundable tax credit for renovations.

    Some economists among the more than 20 attendees criticized the proposal while representatives of the building-trades sector lauded it. Tax credits can be used to reduce the amount of taxes a person owes to the government, but refundable tax credits can benefit filers even if they have no taxes to be paid; in that case, they could get a refund based on the credit.

    The federal Finance Department looks favourably on stimulus spending that helps builders, in part because so many of their materials are made in Canada. This ensures more benefits of stimulus spending remain in this country than if the money goes to taxpayers in the form of rebates to spur consumption. There's a good chance that consumer spending would leak the benefits of stimulus to foreigners: 50 % of durable goods bought in Canada are imported.

    "(By) contrast, only 20 % of investment in residential and non-residential buildings is imported through such inputs as building materials," the Finance Department said in its recent paper on stimulus.

    One important decision Mr. Flaherty will have to make should the Tories proceed with this idea is whether to offer a tax credit for home renovation in general, or merely for retrofits and upgrades that increase energy efficiency.

    Toronto Dominion Bank chief economist Don Drummond said stimulus for home renovations would be helpful because there's a limit to how many public works projects Ottawa can kick start soon.

    "There's only so much of the big infrastructure stuff you can get going
    in 2009 and 2010," Mr. Drummond said.

    "We are past the peak of employment in the construction industry, and those people are going to be getting laid off."

    One drawback of programs such as subsidies for retrofitting and house
    refurbishment is that they are typically difficult to administer, hard to monitor and susceptible to fraud.

    In Ottawa, the premiers plan to ask Mr. Harper when they meet with him
    tonight and tomorrow for more infrastructure money and increased flexibility in spending it.

    The Harper government has committed itself to $33-billion over seven years, and is pledging to accelerate that spending. But premiers want the government to add to the overall global total.

    Governments also appear close to an agreement to streamline
    environmental requirements for infrastructure projects. Ontario is particularly concerned for Ottawa to find a way to increase benefits for the unemployed and not just money for worker training. Toronto wants more workers to be able to access benefits.

    Premiers will not put a price tag on their requests. "Most premiers are not looking to jam up the feds and put an astronomical number they can't meet," the source said.

    Canada's municipal governments yesterday released a list of more than
    1,000 infrastructure projects that they say could start this spring if federal funds become available.

    Combined, the projects would create more than 150,000 jobs, the Federation of Canadian Municipalities said in a release.

    Thursday, January 15, 2009

    Steps to buying a home ... part 1

    In what can be a confusing process, its good to have a little resource like this in your pocket. Over the next few posts in this series, we'll try to demystify the process and answer a few questions along the way. Get in touch if there are specifics for your own situation, we'd be happy to help with more information or direct you to the right resource wherever possible.

    Step 1 - Pre-arrange your mortgage financing

    Consulting a knowledgeable, independent mortgage broker is your best first step in this process. A mortgage broker works on your behalf and is not on the payroll of any bank or lender therefore they offer unbiased advice on the full range of products from a variety of different mortgage lenders so that you can compare and contrast the products available and select the mortgage personalized mortgage solution that works best for you (not what the bank thinks works best for you).

    Your mortgage rate can be guaranteed for up to 120 days so you're able to shop for your home with the comfort of knowing that a sudden increase in rates won't affect you as long since you have those 4 months of protection. And of course if rates drop, your mortgage broker makes sure you get the benefit of the drop. (Do you really think your banker would do this for you ? They get paid to make the bank money, not save you money!)

    Check back soon for our next post on downpayment options.

    Tuesday, January 13, 2009

    Housing Markets Stable to Rising in Eastern Canada

    Jamie Sturgeon, Financial Post Published: Monday, January 12, 2009

    New home prices fell in November for the second consecutive month-to-month decrease, Statistics Canada said Monday. The average price on a new house declined 0.3%, the federal agency said, as demand continued to cool across the national real estate market in the fall. The dip continues the first reverse in home prices in more than a decade, following the 0.4% decline experienced in October. Yet the results varied from region to region, with some markets still witnessing considerable price increases.

    St. John's recorded the largest annualized gain, with the value of a new home up more than 25% from 2007, a clip that narrowly outpaced Regina. The monthly increase in St. John's was 3.4%.

    In a sign that Saskatchewan is beginning to feel the bite of a recession it has largely avoided so far, home prices were flat in Regina in November while in Saskatoon prices continued to come down. New home prices were down 0.5% in Saskatoon "confirming a trend of deceleration in this city," Statscan said. "Builders continued to report difficult market conditions."

    The drops continued further west.

    New home prices in Edmonton recorded a 12-month plunge of 7.9% - largest monthly decline since May 1985. Prices dipped 2.5% in Calgary. On a monthly basis, prices fell 0.3% in Edmonton and 1.1% in Calgary between October and November. On the West Coast, builders cut new home prices in Vancouver by 1.7% in November, a trend continued in Victoria, Statscan said.

    Markets in Eastern Canada, which have shown more stable supply-demand conditions, continued to rise, Statscan said. Compared with November 2007, contractors' selling prices were 4.3% higher in Ottawa and 2.0% higher in Toronto. In Québec, the 12-month growth rate was 5.4%, while in Montréal, prices increased 4.6%, the agency said. No market east of Saskatchewan experienced a month-to-month decline in new home prices.

    Monday, January 12, 2009

    Your 2009 Horoscope

    Hey it isn't all seriousness around here all the time ... a friend passed this along and I thought I'd do the same. Have fun with it !


    Your intrepid nature gives you a head start over lesser mortals when it comes to facing up to life's challenges. But you will have to learn to curb your impatience this year, especially on the financial front. Your competitive streak will keep you a step ahead of the opposition, but with your responsibilities under pressure you must be prepared to streamline your workload and, possibly, even your work force. You also need to be more flexible to compensate for any lack of help owing to financial constraints. By early May you should be able to see what needs to be done to increase your financial stability, but it will still be some weeks before you are in a position to do it.

    TAURUS APRIL 21 - MAY 21

    Because success planet Jupiter enters the career area of your chart in January and forms a series of alliances with artistic Neptune, your creative talents will be much in demand this year. A new direction beckons, one that will mean working with different people on different kinds of projects, and you will discover skills you never knew you possessed. Something that happens around the time of July's eclipses
    will remind you that there is more to life than worry and work. Your role on life's stage will alter in the coming months, and employers and other important people will have a growing influence on your fortunes. The kind of influence depends as much on you as on them.

    GEMINI MAY 22 - JUNE 21

    The economic forecast may not be promising, but why should you care? With your chart pointing to 2009 as being the year when you discover where you truly belong, your personal outlook is exciting and inviting. The winds of change will start making you restless around the time of the solar eclipse at the end of January, and by mid-February you will have a better idea of where you are heading. A change of priorities, and possibly scenery, will remind you that the world has more to offer in
    terms of experiences and environments than you have encountered so far. With three of the year's six eclipses focusing on your finances, your attitude to money will alter and Plan B will become an attractive alternative.

    CANCER JUNE 22 - JULY 23

    The world is changing at an alarming rate, and if you cling to outdated ideas you will soon be left behind. Potent lunar activity in your birth sign denotes a major turning point, a point where things and people you took for granted can no longer be relied upon. Autonomy will give you strength, and even if you are one of those Cancerians who believe that this is but one of many lives, you should act as if it is the only life you are going to get. There must be a sense of urgency about what you do: Tenacity is the key to success. With Jupiter, planet of growth but also of extravagance, influencing your finances, you can make money big time, but lose big time, too.

    LEO JULY 24 - AUG. 23

    New people will enter your life this year, and some of the things you believe in today won't mean a thing to you tomorrow. The eclipses in early 2009 will mark a crossroads in an important relationship, and with a series of life-changing Jupiter-Neptune conjunctions also affecting your relationships, you will have more on your mind than money. That said, the fact that the disruptive Saturn-Uranus oppositions cut across the financial axis of your chart warns of changes ahead, and some brave decisions will be necessary. It will force you to start thinking along
    different, more flexible lines - something you should have done long ago. Never forget that your life has a purpose that has nothing to do with the contents of your bank account.

    VIRGO AUG. 24 - SEPT. 23

    Don't plan on taking things easy this year. Cosmic activity highlighting your responsibilities means that your workload will increase and your main task will be to ensure that you are adequately rewarded for your efforts. Your time is precious, so don't waste it on people who don't have your best interests at heart - especially during the Saturn-Uranus oppositions in February and September. Someone you meet casually in early July will light a spark that will burn brightly for several weeks
    - fun while it lasts, but it won't go on forever. External influences will have an increasing effect on your life as the year progresses, and although 2009 will not be the most comfortable year, it will turn out to be a rewarding one. Eventually.

    LIBRA SEPT. 24 - OCT. 23

    Your astrological forecast for 2009 is a mixture of sunshine and showers. On the downside, the Saturn-Uranus oppositions indicate a bumpy ride when it comes to your work and responsibilities. On the upside, expansive Jupiter in Aquarius means that your imagination will work overtime and you must find ways to make your creative talents pay. Powerful lunar activity in the career angle of your chart indicates opportunities on the work front - especially in June and July - but they
    may not be the sort you are hoping for. Don't discard them out of hand, as they could lead to other things. Your keywords for survival this year are endurance and persistence, and as you have plenty of both you can turn the challenges into positive experiences.

    SCORPIO OCT. 24 - NOV. 22

    This will be a pivotal year and it is unlikely you will be in full control of what happens. What is likely is that your social circle will alter, and new friends and associates will have a significant influence on your fortunes. On the domestic front, you will move house, extend your family or change your living arrangements. February's lunar eclipse will force a difficult choice, although it may not happen until early August. Inevitably, whichever side you favour, the other side will feel
    betrayed. But that is better than allowing a harmful situation to continue. There will be no shortage of challenges as the year progresses, but since your whole life is one long challenge, you will be well equipped to deal with them.


    The whole tenor of your life will shift this year, forcing fundamental changes to the way you live and work. It will mean finding a way to please both employers and loved ones: If you favour one, you will lose the other's support - and that could be costly, financially or emotionally. However, your enlightened ruler Jupiter in Aquarius indicates that what you earn in 2009 matters less than what you learn,
    and that depends on how open you are to new ideas. Much of what you believe in today won't mean a thing to you tomorrow - the world moves on and you must move with it. The next stage of your personal voyage of discovery will bring its own - very different - rewards.

    CAPRICORN DEC. 22 - JAN. 20

    The values you have now will not be the values you have at the end of 2009, so be ready to change your outlook and approach life from a less traditional viewpoint. Jupiter's transit of Aquarius will affect not only your finances, but your belief system, too. Distance lends enchantment, and the planets suggest that you will want to spend more time alone this year. The question is: Are you travelling in the right direction? With the Saturn-Uranus opposition cutting across the knowledge and enlightenment axis of your chart, there will be days when you have serious doubts. Ask yourself what you would like to be doing if family and financial problems did not exist. Then do it anyway.

    AQUARIUS JAN. 21 - FEB. 19

    You are in tune with the spirit of the times and, with enlightened Jupiter in your sign, never more so than this year. Changes to the way you live, think and earn your living may be unsettling at first, but you will come to appreciate just how fortunate you are. Some hard decisions will have to be made, but they will serve you well in the long term. The experiences of 2009 will have a profound effect on your attitudes, your beliefs and the way you live your life. Your roller coaster of a year will get off to a flying start around the time of the Aquarius solar eclipse at the end of January. Hang on tight: You may even enjoy the ride.

    PISCES Feb. 20 - March 20

    You will learn as much about yourself as you will about the world around you this year, according to your solar chart. And since the search for self-awareness matters to you more than most, it will be an enlightening period. On a more material level, you need to keep a close eye on your finances in early April, as some of the people you deal with, although not dishonest, may be careless. Most importantly, plan everything you do with the utmost caution. Two new moons in sympathetic Cancer will bring out your creative side and could lead to a money-spinning opportunity. This will be a memorable year for you, but whether it is for the right reasons lies in your hands.

    Friday, January 9, 2009

    Safer Alternatives to Hazardous Cleaning Products

    I have a 3 and a half year old at home and recently we were watching "The Care Bears" on a kids tv station when an episode came on about dangerous items in the kitchen drawers and cupboards etc so, this article comes from the heart.

    There are so many dangerous chemicals found in the average kitchen or bathroom cabinets that it would make you shudder if you had little ones or pets at home.

    In fact, look in any storage cabinet in your home and you may see such products as paint thinner, spot remover, oven cleaner, furniture polish, drain opener, pool chemicals and hair spray for just a few examples. These products are hazardous because they contain chemicals that are corrosive, explosive, flammable or toxic.

    Here are a few suggestions on safer alternatives to some hazardous products out there.

    Tub and Sink Cleaner:

    Sprinkle baking soda on the porcelain fixtures and rub with a wet rag. Add a little of the liquid Murphy's soap to the rag for more cleaning power. Rinse well to avoid leaving a hazy film.

    Window and Mirror Cleaner:

    Put 1/4 cup of white vinegar in a spray bottle and fill to the top with water. Spray on the surface. Rub with a lint-free rag. For outdoor windows, use a sponge and wash with warm water with a few drops of liquid Murphy's or Castile soap in it. Rinse well and squeegee dry.

    Toilet Bowl Cleaner:

    Sprinkle baking soda inside the bowl as you would any scouring powder. Add a couple drops of soap also. Scrub with a toilet bowl brush and finish outside surfaces with a rag sprinkled with baking soda.

    All Purpose Cleaner for spots on woodwork, tile and linoleum:

    Add a few drops of Murphy's liquid soap to a wet washcloth and rub surface briskly.

    Oven Cleaner:

    Mix 1 cup of baking soda with enough water to make a paste. Apply to oven surfaces and let stand a little while. Use a scouring pad for scrubbing most surfaces. A spatula or a bread knife is effective in getting under large food deposits. This recipe will require more scrubbing effort but it is not toxic to you or your child. Commercial oven cleaners are severe irritants. Do not use this cleaner recipe on self cleaning ovens.

    Drain Cleaner:

    This recipe will free minor clogs and helps to prevent future clogs. Pour a half cup of baking soda down the drain first, ten a half cup of vinegar. Let it fizz for a few minutes. Then pour down a tea-kettle full of boiling water. Repeat if necessary. If the clog is stubborn, use a plunger. If very stubborn use a mechanical snake.

    Other Recommendations:

    In future, buy wisely and consider the environment as well as your family's health. Read labels carefully. Look for "non-toxic" on the label and compare products before you buy. Many times a general household cleaner is just as effective as a specialized product.

    Buy only what you need (and in quantities that you will use quickly) and this will limit the need to store unused products in the home and reduce the need for disposal. Look for child proof packaging and when possible choose non-aerosol products. Aerosol produce a fine mist which when inhaled can settle deep in the lungs and pass into the bloodstream.

    To learn more about safe disposal of Household Hazardous Wastes, visit Durham Region who kindly provided this information.

    Thursday, January 8, 2009

    Canadian Housing Market in for a Correction, Not a Crash

    Some predictions for 2009

    We are going out on a limb and predict that average Canadian house prices should only fall by a further 3% this year (2009). This shows indications of a "
    correction" rather than the "crash" that is being trumpeted by the press and has seriously affected the U.S. housing market.

    On a national basis, this translates to average house prices falling to $295,000 for 2009 versus the estimated $304,000 from 2008. According to figures available for 2007, the average was approximately $307,265 meaning a drop '07 to '08 of about 1.1%. This data tells us that the market actually peaked in 2007 and the correction has been going on for a longer period than previously considered. Since the national press has enthusiastically jumped on the bandwagon of bad news in real estate and mortgages it seems to many observers that this is a new crisis which started only in 2008.

    Information supported by research done by a major real estate firm indicates a projected drop in the number of sales in the coming year of 3.5% (to about 416,000 units) with some insiders expecting price and sales activity increase in some key markets.

    Unfortunately we also predict that more Canadians may lose their homes due to power of sale or foreclosures this year versus last however we highlight the fact that since it takes several months for a typical repossession action to reach this stage, this is not to be viewed as an indicator of new or increased difficulties in the housing arena. Again, this is the cycle which started last year or even previous where job loss or other economic issue is only now just working its way through the system.

    There's no doubt we are still in the midst of a lengthy adjustment period but we remind readers that there are fundamental differences between mortgage lending in Canada versus other parts of the world (especially the U.S.). Things like credit granting in Canada being better monitored, mortgage interest not being a deductible debt and other factors have insured we will not slide as far or as fast as those south of the border.

    Wednesday, January 7, 2009

    Canadian homebuilders deny market headed for meltdown

    No parallels with U.S.
    Eric Beauchesne, Canwest News Service

    OTTAWA - The Canadian housing market is cooling but is not facing a U.S. style meltdown, builders here say.

    "A few commentators have drawn a parallel between the Canadian housing
    situation and the extreme difficulties in the housing market in the United States," the Canadian Homebuilders say in a report Monday that dismisses such comparisons.

    "There is absolutely no merit in drawing such a parallel," it said in a report that contends the pace of housing construction in Canada is merely returning to a level that is consistent with underlying housing requirements following the boom of recent years.

    "The housing situation in Canada is totally different from that of the U.S.," it said. "There will be some price moderation in some markets, but there is nothing to suggest that housing markets in Canada are vulnerable to the oversupplies and plunging prices that characterize many markets in the U.S.

    "We did not experience the same housing boom conditions that occurred in the U.S., and there is no reason to expect that we are in for the serious pain they are currently suffering," it said.

    The moderation of house prices will improve affordability and create opportunities for first-time home buyers, it said. Meanwhile, existing homeowners have little to fear.

    "For those selling a home and buying another, the moderation of housing prices should be relative - there should be no significant gain or loss from the easing of house prices," it said.

    "For those who have owned a home for some period, their equity will be substantial, given the rising prices of the past few years," it said. "For those who purchased their home recently, there should be few worries about a modest temporary reduction in value."

    To support its argument that the Canadian housing market is not going the way of the U.S. market, it cited a variety of differences:

    * Unlike in the U.S., underwriting standards for qualifying mortgage borrowers in Canada have been maintained at prudent levels resulting in mortgage borrowers here being much more creditworthy;

    * Canadian mortgage lenders never offered low initial 'teaser' rate mortgages that led to most of the difficulties for mortgage borrowers in the U.S.;

    * Most mortgages in Canada are held by their original lender, not packaged and sold to third parties as is typical in the U.S., and consequently, Canadian mortgage lenders have a vested interest in ensuring that their mortgage borrowers are creditworthy and not likely to default;

    * Only 0.3% of Canadian mortgages are in arrears versus 4.5% in the U.S. and what even before the start of the U.S. housing meltdown two years ago was 2%;

    * Canadians tend to pay down their mortgage faster than in the U.S. where mortgage interest is deductible from taxes, which encourages U.S. homeowners to take equity out of their homes to finance other spending, a difference that is reflected in the fact that in Canada mortgage debt accounts for just over 30% of the value of homes, compared with 55% in the U.S.

    In Canada, home prices are down 9.8% from a year earlier, compared with an 18% drop in the U.S. from what were already deeply depressed prices a year ago, the latest real estate industry figures show.

    Most analysts here agree that Canada should avoid a U.S. style housing market meltdown.

    Michael Gregory, senior economist with BMO Capital Markets, said recently that "we won't even come close" to what is happening in the U.S. thanks to stronger employment and income growth here as well as banking system that "continues to make mortgages" available to Canadian consumers.

    But he cautioned that if unemployment rises in Canada, there will be a larger fallout for the domestic housing market.

    "Anyway you slice it, if you don't have a job, you can't get a mortgage and you can't buy a house," Mr. Gregory said.

    Tuesday, January 6, 2009

    New construction homes

    Here's an article you may have missed in the Toronto Star on Saturday this past weekend. For those considering buying a new construction home, this article offers some good tips to remember. And remember, you should always discuss your plans with a qualified, licensed mortgage professional.

    Inspections: If these walls could talk

    Jan 03, 2009 Tracy Hanes Toronto Star

    After almost a year of living in their new townhouse in Uxbridge, Libby McCready and her husband figured there was little wrong with their home. But Libby's parents, who had bought several new houses over the years, urged them to take the time to fill out the Tarion new home warranty program's one-year report listing any issues.

    As neither Libby nor her husband had much knowledge or experience with home building or repairs, they hired home inspector Brian Daley to have a look.

    "We wanted to make sure we caught everything but we're not handy," says McCready. "Brian found a number of things we never would have noticed. The stuff he found came as a surprise."

    The most significant defect Daley found was that the clothes dryer hadn't been vented properly, thus was not blowing outdoors but into insulation, which could have eventually caused a moisture and mould issue. He also noted that the plumbing to a toilet in a seldom-used second bathroom wasn't on the right angle for flushing, that a promised rough-in for an electrical fan for the fireplace was not completed and that attic insulation had been flattened in places.

    Armed with Daley's report and digital photos, the McCreadys filled out the Tarion Warranty Corp. forms by the one-year deadline and as a result, those issues are covered. If they hadn't submitted the report in time, their builder would not have been obligated to repair the defects.

    "Although everything turned out fine, I'd never move in to a brand-new house again without having a home inspection done right away," says McCready. "I would have rather had a comprehensive list of the problems from the start, as we'd lived here for almost a year and some of the issues could have caused problems. The inspection was totally worthwhile."

    Unfortunately, most new homebuyers mistakenly "believe their new house is perfect," says Daley, when that's seldom the case. That's why Daley and Charters Kenny, both registered home inspectors (RHI), have launched New Home Inspections , a company that specializes exclusively in new home warranty inspections in the GTA and beyond.

    Other home inspectors, such as Milton RHI and engineering technologist Martin Sweeney of A Home Inspection Company Inc. have also started offering warranty inspections in addition to their regular inspections of resale homes. Sweeney began doing new home inspections and preparing Tarion documents for homeowners as new development boomed in Halton Region.

    New homes in Ontario are covered by the Tarion warranty for deposit insurance, protection against defects in work and materials, against unauthorized substitutions and against delayed closings and occupancies without proper notice. The most common claims relate to defects in work and materials, which require homeowners to submit a list of deficiencies at 30-day and one-year deadlines.

    While builders provide a pre-delivery inspection (PDI) for buyers to note defects, Daley and Sweeney say these are more geared to cosmetic issues, such as nicks in drywall and whether the right flooring, cabinetry, etc. are provided. Those inspections usually don't include checks of the attic, of heating and cooling systems or an in-depth exploration of the house's structure and systems. And while independent third-party inspections take about three hours, PDI inspections are usually far briefer.

    Daley says outside a new home, his company checks drainage and grading, looks for foundation defects, checks installation of siding and brickwork, roof installation and venting. Inside, they inspect walls, windows, floors, ceilings and doors for structural issues, check that stairs are properly supported, plumbing fixtures and fittings properly installed, that insulation in attics, basements, etc. is sufficient and will see if the heating system is distributing air properly.

    "I often find insulation is insufficient or missing in attics," says Sweeney. "Sometimes, vapour barrier hasn't been installed, and on the roof I might find that nail heads haven't been caulked and sealed, which will eventually cause moisture to seep in."

    He says it's difficult for the average homeowner to have knowledge of the systems and techniques used to build a house. For example, the new tankless hot water heaters and heat recovery ventilators are "really sophisticated pieces of equipment." He often finds HRV units haven't been correctly installed.

    Daley says his company finds an average of 30 defect items during a warranty inspection and Sweeney says his list usually includes 20 to 30. J.D. Power and Associates' 2008 survey of GTA new home buyers found that the proportion of homes delivered "defect-free" in the GTA market was 12 per cent in 2008 (which means 88 per cent had defects). The total number of construction problems noted by buyers was down to 21 per home in 2008 from 23 per home in the previous year, according to the J.D. Power study, which includes only large volume GTA builders.

    "It's not because most builders aren't doing a good job or are taking shortcuts," says Daley, but because homebuilding involves numerous complex systems.

    Most large builders rely on sub-trades and as many as 30 different trades can be involved in the building of a home, says Daley - and it's unlikely all were supervised during the building process. Because they are piece workers, saving time and money is their No. 1 goal, says Daley, which may compromise quality.

    Municipal building inspectors are responsible for checking every aspect of a house as it is being built, but it's virtually impossible to do this effectively in a subdivision, says Daley.

    "What generally happens is they check a small percentage of homes in hopes the builders will follow their requirements for the rest of the homes."

    While a builder may offer to provide one of his own reps for a warranty inspection, "it is not in the builders' interest to find fault in their own work." Daley says some builders have the best intentions, but it's more likely that their inspector will find fewer defects than a third-party professional.

    Daley's company charges $375 per inspection and Sweeney charges $340 to $400, depending on the size of the house. Inspectors from both companies can help fill out Tarion warranty forms.

    Anyone considering hiring a home inspector should call at least three different companies before making a decision, Daley suggests. Those with RHI designation have extensive training and are insured. A good place to start a search for a home inspector is with the Ontario Association of Home Inspectors.

    Monday, January 5, 2009

    Become "Mortgage-Free" Sooner

    Paying off your mortgage the traditional way could take anywhere from 25 to 40 years and would end up costing around twice the amount you paid to buy it in the first place. That doesn't sound like a great deal does it ? (still better than paying rent though !)

    Here are some effective ways to pay off your mortgage sooner, build equity faster and save thousands of dollars in interest:

    1) Change Your Payment Frequency

    By simply increasing your payment frequency from monthly to biweekly or weekly can save thousands of dollars alone over the course of your mortgage. The best thing about this option is that it costs nothing to do - no service charges or administrative cots (and if it does, then you got the wrong mortgage advice). If you can afford to pay a little extra in the year then this would be the perfect way to do so without any penalty.

    The way this works is by dividing your monthly payment in two or four and paying faster. There are 12 monthly payments in the year BUT there are 26 biweekly or 52 weekly periods so ... you pay the equivalent of one extra monthly payment per year without a penalty.

    2) Take Advantage of Prepayments

    I know, I know ... where are you going to find any extra money nowadays ? Well, it doesn't have to be a lump sum of thousands of dollars at once in order to take advantage of this feature.

    Most mortgage lenders allow prepayments as low as $100.00 and will automatically deduct it from your preauthorized bank account. You may have to give them something in writing to do so - they'll need your written OK for their files -
    but that's the extent of the hassle. If you did this once a month instead of trying to save up a bigger amount then you'd be surprised how easy it fits into your budget and how fast you see the difference.

    Remember: Your mortgage is a very long term contract so reducing it visibly in a month or two is not realistic and shouldn't get you down. As a matter of fact, even if you only make one single $100.00 extra payment then you'll be miles ahead of most Canadians! Most people don't bother making any prepayments at all even though tey fight for the priviledge of doing so.

    3) The "All-In-One" Type of Mortgage

    Caution: this mortgage type takes a lot of restraint and is not for everyone. Make sure you check with a mortgage professional before entering into this type of mortgage.

    Instead of making weekly or biweekly payments or lump sum instalments of any size, you may consider switching to a relatively new type of mortgage sometimes referred to as an "all-in-one" mortgage.

    Basically this turns your mortgage into an account where you deposit your pay or other income (this takes care of the minimum required payment) and then pay your bills, do your shopping etc from the very same account. The idea being that you earn more than you spend - that's why we urge caution - and by having every dollar you earn reduce your mortgage amount before you make your purchases , you reduce your mortgage faster. Think of it like a line of credit.

    Some financial institutions offer this type of product however we can't stress enough that there are differences that must be considered and explained carefully before you get into this product even though the savings can be substantial.