Open House - The Real Estate & Mortgage Show

Real Estate and Mortgage Answers

CFRA_Open_HouseEvery Saturday morning at 11 AM, Paul Rushforth and mortgage broker Frank Napolitano join CFRA’s Steve Gregory on Open House.

They provide expert answers to real estate and mortgage questions from people just like you.

You’ll find plenty of information on how the market is doing and why, and they also have plenty of fun along the way!

Whether you’re new to real estate or have plenty of experience already, you’ll find the latest updates you need to prepare for your next home purchase or sale.

You can play the episodes by following the link below.

Highlights From Recent Episodes

Here are some highlights from past episodes. If you’d like to listen to the episode, visit the podcasts page.

August 17, 2019: Guarantors & First Time Home Buyer’s Incentive

Guarantors

A guarantor is someone who helps another individual out with a loan or mortgage. Almost anyone can be a guarantor. As long as you’re over 21 years old, able to maintain a good credit score, and is stable financially.

Select lenders are open to allowing parents to sign as a guarantor to their kid’s mortgage. 

Going “on title” makes you the legal owner of a property or loan. Parents don’t want go on title when they sign on, which is an option as a guarantor.

There’s little risk to go on as a guarantor. One positive to it doesn’t show up on your credit bureau.

More Information on First Time Home Buyer’s Incentive

If you renew your mortgage, you don’t need to pay back the incentive at that moment. If you refinance, you simply need to pay back the down payment. If you sell the house, you need to activate a shared equity program.

There’s a 5% tax if you’ve made money on the property. Investing in your home, like renovating rooms, will also be taxed.

The closing date is before November 1st.

Time Stamps:

While Paul is away at a speaking engagement in Anaheim, Josh joins Frank and Steve to talk listings, new builds (2:23), down-payments, guarantors (4:36) and multiple buyers (6:49). After the break, the gang talks about Denmark’s interest rates (9:40), today’s rates and bond markets (12:03). Then, the discussion shifts to a more in-depth conversation on “First Time Home Buyers Incentive” (14:34). The conversation moves towards buying outside the city (21:00), condo fees (23:10), and townhomes (28:20). To finish the show, the guys talk about over-buying and dealing falling apart (31:30).

August 10, 2019: How To Deal With Bad or Over-Exaggerated Home Inspections?

Errors and omissions insurance protects you against false claims against homes and businesses. If there are any false statements in your home inspection, you’re protected against slander towards your home when legal action is taken.

Buyers are allowed to have their own home inspection. If you’ve received a bad inspection, move on from it.

An individual home inspection shouldn’t affect how future buyers see your home. Home inspections DON’T need to be shared with other buyers. Let other buyers perform their own home inspections.

Once a buyer has performed a home inspection, make the necessary changes if they’re legitimate issues

Home inspections are completely private unless there are cases of serious health issues in your home. Rectify any legitimate issues because if another buyer performs another home inspection with the same results, then your home could get flagged.

Time Stamps:

Paul joins Steve and Frank by phone call to chat about renovating and selling in Constance Bay, the condo market (2:25), and how mortgages and real estate are affected by unemployment, employment & self-employment (6:50). A listener phones-in to the show to ask about over-exaggerated home inspections and what to do in that situation (10:40). After the break, the gang talks about prime and 5-year rates (21:50),  how a potential recession could affect listings and rates (25:55), and smaller home vs. larger home sales (27:53). To conclude, the guys finish with a discussion about the criminal aspect of brokerage fees (33:30).

August 3, 2019: Breaking Bad Realty Practices & Banking Habits

Breaking Bad Realty Practices

A bad realtor practice is cancelling a showing because you’ve received a single offer. You could be missing out on multiple offers.

Who you hire is so important! Interview at least 3 realtors. You need to know if you’re working with a top agent or someone who’s doing this part-time. If they don’t come prepared or know their numbers, get a new agent.

Breaking Bad Banking Habits

A bad habit is thinking your bank is your best option.

Banks are hard on customers when selling insurance. Insurance doesn’t need to be purchased through the bank. You’re better off to reach out to an independent insurance broker.

Banks will say, “rates are going up”. When in reality, the rates are trending down.

Banks make billions from customer loyalty. When you need the bank the most, they’ll take advantage of you through penalties.

Nowadays, it’s so easy to handle your banking from your phone. Don’t feel like you have to stay with one bank because you want everything in one place.

Time Stamps

Steve and Frank are joined by Josh, while Paul is on vacation. The conversation starts with rural properties, townhomes, and homes around the light rail transit (3:35). Then, the gang talks about equity, mortgage-free homes (6:30) and Canadian rates (9:38). After the break, the guys talk listings, buying homes outside the city (12:24), and “doghouse” homes that are selling (15:18). Then, Frank talks about income privacy (17:35), and the guys talk about breaking bad banking habits (20:15). Steve shares Paul’s “Bizarre Reality Story of the Week” email and bad realty practices (28:26). The conversation ends with variable versus fixed mortgages (32:40).

July 27, 2019: Pre-Approvals & Why Your Home Isn’t Selling?

Pre-Approvals

What Are Pre-Approvals?

A pre-approval is a certified document where a lender states that you qualify for a loan. Pre-approvals focus on your income and credit history.

On average, after a proper pre-approval, lenders will respond within 4 hours. Package your approval applications properly to ensure a quick response.

Why They’re Important?

Pre-approvals indicate to both realtors and mortgage brokers that you can be trusted financially.

In real estate, people are forgetting to get pre-approved. As a result, deals are falling apart due to financing. If you’re not pre-approved, it can hurt the momentum of selling a home.

Why My Home Isn’t Selling?

One misconception is thinking if you throw up a “for sale” sign, you will sell your house. You want to be listed with a strong marketing team.

The market is shifting every week. It’s important to be aware and monitor the market for an accurate selling price. If you aren’t receiving showings within 2-3 weeks, the problem is either a pricing error or the condition of the home.

It isn’t a realtor’s fault if buyers are pouring into your home and don’t buy. It’s their job to bring in the buyers.

Time Stamps

Paul, Steve and Frank start the conversation with mortgage rates and the bond markets (4:05). Then, the guys touch on the dangers of not being pre-approved (6:39), rentals (8:40) and financial timeframes (9:50). After the break, the conversation continues with topics such as the importance of pre-approval, mortgage applications (11:35), mortgage fraud (15:00), and average realtor sales (18:55). Paul then talks about today’s real estate listings (21:20) and then, the gang discusses why your home isn’t selling (22:36). Lastly, Rick calls-in to the show to talk about the Paul Rushforth Charity Golf Tournament and Frank’s alleged win (35:25).

July 20, 2019: Fixer-Uppers & Rule Breakers

Selling Fixer-Uppers

Fixer-upper homes aren’t popular anymore. Be careful with the wording on your MLS listings. Words like “work needed”, “TLC”, “home renovations” raise red flags.

What realtors look for in pricing:

  1. Location
  2. Condition of home
  3. Square footage

Realtor & Mortgage Broker Rule Breakers

244 Forms in Realty

A bully offer is when a buyer submits an offer before a specified date the seller indicated they’d review offers.

When you sign a 244 Form, a seller can’t consider an offer before the specified date. These are in place to legally stop bully offers.

If you sign a 244 Form and break that agreement for a bully offer, you’re breaking the law and that could result in legal action.

Broker Fees

A broker fee is established when the broker has done a specialized service or something beyond their expected services. Your broker shouldn’t be charging you broker fees unless expressed before the signing of the agreement and the reason for the fee.

Beware broker fees. They’ll be found in the fine print. These brokers won’t tell you until you’re cuffed to the deal and will reveal the fee at that time.

These fees can vary from $5,000 to $20,000. Broker fees often happen in private broker deals.
If you find a broker fee in your agreement, get out early.

“You won’t succeed in these businesses if you’re only in it for a quick buck. This is a relational business.”

Time Stamps

Paul, Frank and Steve start off by talking about listings (1:45) and selling fixer-upper homes (2:53). Frank brings some mortgage news from the Bank of Canada lowering mortgage rates (8:25) and the gang talks downtown condos vs. out of town housing (10:10). After the break, the guys talk about listings (13:34), our present market and potentially, a future buyers market (14:23). Paul continues his discussion on multiple offers and “bully” offers (20:20) and Frank talks about the 5% of mortgage brokers who cross the line with broker fees (25:25). Lastly, Paul talks about servicing with excellence and professionalism (36:45).

July 13, 2019: Rates, Insurance & Collateral Mortgages

5-Year Rates and 10-Year Rates

At the 5-year mark, the bank cannot charge you the interest rate differential, just like a variable. If you’re above the 5-year mark of your 10-year, it’s a good idea to switch to a new 5-year and potentially achieve 1% savings.

In the last 8 months, rates went down from 3.69% to today’s 2.79%, while the Bank is at 5.34%. This means the interest rate differential has gone up tremendously. To break your mortgage, it’ll cost more than before.

Dangers of Bank Insurance

A bank can never reject you if you don’t take their insurance. We recommend looking towards insurance agents as an alternative.

At 65, you can be denied bank insurance. Instead, look to a personal insurance agent.

Collateral Mortgage & Owning Your Home Outright

A collateral mortgage has no expiry date.

Once you’ve paid off your mortgage, regardless if it’s a collateral or standard mortgage, you own your home outright. Keep the paid-mortgage documentation that’s sent by the bank as proof.

If you own your home outright with a collateral mortgage and you’re able to borrow against your house, you can invest that money into properties or other forms of investments.

Once you discharge your mortgage, you’ll need to go through the whole process again.

Time Stamps

Paul, Frank and Steve start off the show by talking about Bank of Canada rates (1:40), 5-year vs.10-year mortgage terms (2:42), and interest rate differential (4:05). Frank talks about the dangers of Bank insurance (6:25) and being denied insurance (10:15). After the break, Paul touches on this month’s seller’s market and listings (12:35), and over vs. below-asking prices (13:48). Then, the gang talks about multiple offers (15:10) and the rising prices of townhomes (18:14). A listener calls-in to the show and talks about collateral mortgages, frauds and owning your home outright (22:25). Based on the previous conversation, the guys talk about investing through your collateral mortgage (27:05). To end the show, the guys talk about relationships with mortgages (33:20).

July 6, 2019: First Time Home Buyer Incentive & Investment Properties

Paul Rushforth Charity Golf Tournament 2019

Another successful charity event! A hot but beautiful day for golf. Thanks to all that attended.

The charities that were donated to are the Ottawa Sports & Entertainment Group (OSEG) Foundation & the Orléans-Cumberland Community Resource Center.

Over 8 years, the Paul Rushforth Charity Golf Tournament has raised over $250,000.

Is “First-Time Home Buyer Incentive” Worth it?

What is the First-Time Home Buyer Incentive?

This incentive allows first-time home-buyers, who are eligible for a minimum down-payment on an insured mortgage, to fund a fraction of their home purchase through shared equity with the Government of Canada.

First-Time Home Buyer Incentive seems like a good idea. But, is it worth it? No. With today’s market and rates, you’ll end up giving away equity.

If you’re making over $120,000 in combined income, you won’t qualify for the incentive.

This incentive launches on September 2nd, 2019.

Tips on Investment Properties

If you know your rent is “x” amount of money and you don’t want to take a risk going with a variable as the prime rates continue to rise, choose a fixed mortgage.

If you’re unsure about keeping your property, choose a variable mortgage. A great choice to avoid high penalty fees

Choose the right tenant. Tenants can be a liability if not vetted properly.

Turning your Investment Property into an Airbnb is a huge risk for lenders. Airbnb can lead to good money but traditional lenders will think twice about lending you money.

Time Stamps:

Paul, Frank and Steve start by reminiscing on another successful Paul Rushforth Charity Golf Tournament (0:25). Paul shares statistics about average sales prices (5:40) and discusses why larger homes are harder to sell (8:40). The gang talks present rates, economy predictions (11:30), why “First Time Home Buyer Incentives” aren’t worth it (14:35), and end of year predictions (17:28). They then discuss prime, fixed and variable mortgages (21:10), investment properties, tenants and Airbnb (28:20). In closing, the guys discuss living in a tough buyers market (32:50), drone licenses and the importance of professional photography (35:10).

June 29, 2019: MICs & the New Housing Market

What is an MIC?

A Mortgage Investment Corporation (MIC) is a private lender that accepts investment dollars and invests money into a pool of mortgages. Known as “band-aid financing”, it’s short term financing for those with a personal situation (illness, divorce etc.).

This short term mortgaging is written on a 1-year open basis. As soon as people are eligible, they can leave with no fixed terms.

Since its inception (2014), an investor of the MIC has made 7.837% in returns.

For more information about MICs, email info@advancedmic.com or call Anisa at (613) 656-0869 for investing information.

New Housing Market Tips

In today’s market, people are lining up to purchase new housing. The prediction is we’ll be heading towards a buyer’s market in real estate.

Don’t go into a new home sales center without an agent. You need someone there who knows the market and what questions to ask.

Once you sign in at a new home sales center, you’ve lost your right to a realtor.

Time Stamps

Barb joins Steve and Paul on Canada Day Weekend to talk about the importance of listing errors (1:50), professional photography (2:45), and rising townhome listings (9:50). Special guest Anisa Lancione explains MIC’s for both investors and borrowers (12:50). Other topics arise such as today’s housing and condo market (21:00), asking the right questions when buying new (24:35), and today’s rates (32:00).