Lethbridge, AB

I had a meeting today with a business development manager from Hometrust today. As the lending climate in Canada is in a bit of a state of confusion, it is important to stay in constant contact with industry members and keep abreast of product changes and developments.

Hometrust has previously been an alternative lender (aka B lender or subprime lender) but are moving more into main stream products. I assume that this is a progression towards improving the quality of the mortgages on their books. They have also become famous for offering a secured credit card which can be a great first step for people to rebuild their credit or to establish credit for the first time. I have personally used their card and have helped many friends and clients use it successfully to rebuild or attain higher credit scores.

Hometrust, like many other lenders, has began to focus more upon credit scores. They are shying away from low score applicants. They are also lowering their offered loan to value ratios on may products. They still offer the entire product list of mortgage products insured by CMHC and AIG. (one of the few lenders using AIG). Also of note, is that Hometrust is one of the few lenders who is currently offering mortgage products for rental properties, as this was the first product that most lenders in Canada withdrew from their offerings.

In summary, my meeting assured me that Hometrust intends to succeed in the tightened credit market by offering products that others have shyed away from. They also remain committed to offering B products and subprime products on quality products for marginal applicants.

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<p><a href="http://lethbridgeloans.com/index.php/screen/contact">Robert May</a> is the broker and owner of Rainbow Realty of <a href="http://lethbridgeloans.com/index.php/screen/resources">Lethbridge</a> Alberta. He is also a licensed <a href="http://www.lethbridgeloans.com">mortgage</a> associate and <a href="http://www.lethbridgeloans.com">financing</a> expert with
<a href="http://www.canadafirstmortgage.com">Canada First Mortgage</a> of Calgary Alberta. He has been in the <a href="http://www.lethbridgeloans.com">real estate</a> industry since 1993 and offers full MLS real estate services to <a href="http://www.lethbridgeloans.com">Lethbridge</a> and surrounding area, as well as <a href="http://www.lethbridgeloans.com">mortgage</a> financing, <a href="http://lethbridgeloans.com/index.php/screen/renewals">refinancing/renewals</a>, preapprovals, and home <a href="http://www.lethbridgeloans.com">equity</a> financing to <a href="http://www.lethbridgeloans.com">Lethbridge</a> and Southern <a href="http://www.lethbridgeloans.com">Alberta</a>. He can be found online at
<a href="http://www.lethbridgeloans.com">www.LethbridgeLoans.com</a></p>
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The National Do Not Call List (DNCL) came into effect in Canada on September 30th, 2008. It is a set of rules that telemarketers must follow regarding unsolicited telecommunications (by way of either fax or phone). Consumers can register up to 3 different telephone numbers in an attempt to reduce the amount of telemarketing calls they receive. Registered charities, political parties and newspapers are exempt from the DNCL rules.

This new regulation affects me in two ways, as both a consumer and a real estate agent. As a consumer, I am delighted to have a new tool to help me effectively battle unsolicited calls. As a mom with two small children, I get a little hot under the collar when I rush to the phone or my 1 year old's nap is cut short only to pick up the phone to hear a recorded voice ask me if I am interested in reducing my credit card rates..... for the third time this week....NOOOOOOO!

As a REALTOR®, this new set of rules affects me from the other side as well. As of yesterday, it became our office policy that unsolicited calls or "cold calling" would no longer be permitted (which brought mostly laughs, cheers and one sarcastic "Oh no! How will I ever do business?!" around the boardroom table!)

I personally don't believe in cold calling. I have never made a cold call, nor did I ever intend to. I really believe that there are better ways to reach people and build business. In my opinion cold calling shows great disrespect for people's time and personal family life. I believe that the unscrupulous acts of unsolicited telemarketing left a bitter taste in the mouths of many and based on the fact that the phone lines to register for the DNCL were absolutely JAMMED on September 30th, it seems there are a few Canadians out there who agree with me!

Visit me for more information on Lethbridge Real Estate

Recent changes in federal regulations on mortgages have eliminated the popular zero-downpayment financing programs that were available through the major mortgage default insurers.

This does not mean that you will be unable to purchase a home without a minimum of 5% downpayment saved.

All Source Mortgages uses several lenders who have options available even if you don't have 5% or more saved towards the purchase of a home. It is important that you get in touch with a mortgage professional in order to discuss all of your options.

Fast Facts about Downpayment programs offered by All Source Mortgages

Do I qualify for a mortgage with Less than 5% downpayment?

As long as you can prove a strong credit history IE: established credit history combined with strong credit score, you may be eligible for a cash-back or flex-down mortgage, essentially where the downpayment amount is borrowed.

What is strong credit score?

A credit score of 650 or above and minimum of 24 months of revolving credit (IE credit card/line of credit) is typically the minimum requirement used to qualify for these types of programs.

Does "Zero-down" mean that I don't need any money saved to buy a home?

Lenders will still require you to prove savings of at least 1.5% of the purchase price of home. This amount is to verify that you will have enough money on hand at possession to pay for closing fees such as lawyer's fees, property tax adjustments etc. Ask your mortgage broker or lawyer for a complete list of expected costs of purchasing a home.

I have a few credit "issues", but would still like to purchase a home.

We do have access to lenders that are willing to provide mortgage financing even if you don't have A credit. In cases where credit score is under 650, the rate that you will be offered and downpayment amount will likelybe related to your credit score. Typically, the lower the score, the higher the rate due to the risk associated with the deal. It is best that you discuss your credit history with your Mortgage Development Manager in order to determine your options.

For more Mortgage Solutions please contact Shaun today!!

I often hear comments about why home sellers and buyers are frozen in their tracks right now. Here are some of the things I am hearing and my responses on why it might not all be true:

Comment:

It's not the time to buy.. prime rate is dropping and I will wait until it hits bottom.

Response:

If you have a crystal ball, I would love to borrow it! Having a husband who is a mortgage specialist in Lethbridge, I have learned that even those in the know don't know when, how much and what direction rates will go. This excerpt from yesterday's Toronto Star says it all:

"Canada's big banks passed on the full value of the Bank of Canada's quarter percentage point interest rate cut yesterday, making it cheaper for consumers and businesses to borrow.

"The outlook for growth and inflation in Canada is now more uncertain than usual," the bank said in a statement after reducing its overnight rate to 2.25 per cent.

Canada's big banks followed suit late in the day, cutting their prime lending rates, the basis for many loans, to 4 per cent.

What kind of insanely cheap rate are buyer's looking for... it really doesn't get much better than this does it? Good rates, hundreds of homes to choose from... take your pick!

Comment:

It's not the time to sell. My home's value is not at it's peak and I will wait it out.

Response:

If you are moving laterally within a market, you aren't going to feel the effect of a lower market value of your current home as you will be replacing it with a home valued within the same type of market. We all know that real estate is cyclical. If you are looking to upgrade, you will make your money in your next home when the market swings upwards again. And what a fantastic time to buy... have you ever seen a better selection!

Comment:

The economy is tanking and I will squirrel my money into GIC's and bonds rather than invest in real estate.

Response:

Are you aware that Lethbridge currently has a 0.8% vacancy rate? Are you aware that rents have been steadily increasing and that all you need to do to get your property rented out is whisper to your neighbor that you have a home for rent? Oh, and did I already mention that it's ridiculously cheap to borrow money right now?

So, If you really must wait, then do so. I'm not sure who said freeze or why...but I would suggest looking through the cloud of bad press and eternal pessimists and see the golden opportunities lurking.

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My apologies for getting this out so late... I keep hearing talk about this slowing real estate market but I've been swamped! With that said, on with the report!

When comparing the September 2008 stats to those of August 2008, we again see a decline in the the number of new listings in Lethbridge (down from 534 to 460) followed by a parallel decline in the number of listings that are expiring unsold (174 in August to 116 in September). Perhaps an indication that only those who are serious about selling are putting out a "For Sale" sign and the days of fishing for top dollar are dead and gone. Surprisingly though, the total number of homes that sold across the board in the month of September (228) is only down slightly from August (236).

One stat that sticks out to me is the comparison between the homes sold with respect to new listings. August stats came in at 44% (homes that sold compared to new listings) while September is telling us 50%.What these stats say to me in a nutshell is that on average there are roughly 50 qualified buyers for every 100 homes for sale. They are taking their time, taking their pick and taking advantage of this buyer's market. So what does this mean for buyers and sellers alike?

Buyers: This is an overstocked inventory and you have the opportunity to look for the house that is "On Sale". With that said, recent years of quick sales and inflated prices led home sellers to falsely believe that their "seller's market" would last forever. Real estate is cyclical and ever changing. Don't wait until your opportunity has passed.

Sellers: If you want a sale, make sure you are priced right and that your home's "value" is prominently displayed when all your and your REALTOR's hard work manages to get one of those few buyers through your front door.

Visit us for more information on Lethbridge Real Estate.

Lethbridge Real Estate Board

MLS ® Statistic Report

[SEPTEMBER 2008 ]