Wednesday, July 13, 2011

Strategy Even More Important....

PropertyWire.ca
July 12, 2011
By: Heather Wright

Despite their best intentions, Canadians are finding the cost of living their lives day to day often interfere with the widely popular goal of becoming mortgage free faster.
“When it comes to putting your mortgage on the fast track a little can go a long way,” says Victor Peca, mortgage broker with Mortgage Intelligence in Mississauga. “But while Canadians have good intentions about hitting the accelerator on the steady race to lower their mortgage balance, they may also need a bit of guidance on how best to reach the finish line.”
The best way to bridge the gap between intention and action, is to map out and include a strategy as Karen Blomquist, Mortgage Broker, Mortgage Intelligence told Propertywire.ca: “If you don’t set things up initially, they generally won’t happen.  I always recommend to my clients bi-weekly payments, if they are able. This works much better than just hoping!”
“Also, I recommend for them to set up a separate bank account, to have automatic savings deposited into.  I also recommend that they try to use these funds to put down on their mortgage each year.”
In this environment of conflicting reports with positive economic data, and soaring consumer prices, whether or not interest rates will go up is really anybody’s guess.  This uncertainty too, though makes due diligence even more important then ever.
Blomquist suggests sitting down with clients as a matter of course and doing a full budget analysis in a spreadsheet. Also, with this period of rate uncertainty, she suggests, as she does to her clients, that the best strategy is to get pre-approved. “Rate holds are good for 120 days. You should find out what you qualify for- and then we can run appropriate due diligence and risk management.”
In addition to suggesting tools like reduced amortization, adjusting payments, and accelerating payments, Blomquist suggests that one of the best things a mortgage professional can do for their clients, beyond the required due diligence- is to communicate, and to be a partner in helping to identify their mortgage and borrowing goals.
“I like to figure out goals and long term strategy. I like to figure out what they want to accomplish, and where they are going, in the short term and in the long term too.”

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