What is a Mortgage Pre-Qualification?

So if you have been shopping for a home, chances are you have submitted information that has been used in "pre-qualifying" you for a home loan. Pre-qualification (also sometimes called a pre approval) is a term used in mortgage loan circles meaning that a loan officer has taken some information from you, the potential borrower, and made a tentative decision, but not verified much of, if any of it.



Typically in a pre-qualification, the potential borrower is asked for their social security number, their employment, income and asset information and the amount of current monthly debt. In addition the potential borrower is asked about their general credit worthiness. This information is then quickly worked up and contrasted against industry standards for qualifying credit scores and debt to income ratios.

Based on this quick work up the potential borrower will be told that they pre-qualify up to a certain mortgage loan amount. For example, if the borrower makes $3,000 / month this is then calculated to an industry-standard ratio of debt to income (which can vary depending upon mortgage loan program), for example 36%. So if a borrower makes $3000/month they would be pre-qualified at a total debt of $1080 (this includes any monthly payments, including car & credit card min. amount; along with the proposed payment of principal, interest, taxes and insurance).

Dependent upon the loan program you choose, other factors that may be included in determining your pre-qualification status...monthly residual income (that income remaining after paying all monthly obligations and family support), middle FICO score whether or not you are a first time home buyer, if the refinance has a "cash-out" amount requested, whether or not you have had a bankruptcy or foreclosure, how many times you have been late on a mortgage payment and how recently, your income type and the way you will verify your income (W-2, tax returns, bank statements, etc). Additionally, property type, property use, loan-to-value ratio (LTV), purpose of loan all play into the over all ability to qualify for a mortgage loan.


If you are preparing to shop for a home and will be seeking a mortgage loan, it would be a good idea to gather the following and allow your mortgage lender to review them thoroughly.

DO's and DON'Ts during your home shopping and home purchase periods.

DO save money
DO send payments on time
DO pay cash for common items
DO keep credit balances under 50% of credit limit
DO keep credit card accounts open even if balance is paid off or zero
DO keep down payment funds in one account with minimal activity

DO NOT open new credit accounts
DO NOT take out new consumer loans or other credit
DO NOT pay off collections (without consulting your Loan Counselor)
DO NOT buy a new car, truck or motor home (wait until after the close of escrow)
DO NOT close accounts with a zero balance
DO NOT pay down credit balances or pay off credit accounts (without consulting your Loan Counselor)

3 Huge Savings on Energy Efficient Home Building

One of the biggest trends in new home construction
in recent years has been the move towards Energy Efficient Housing. This design trend helps to make homes more cost effective to operate while at the same time working to minimize the impact on the environment of heating or cooling your home. Your new home can be a big user of energy, primarily for keeping the inside at a comfortable temperature for you and your family.

That's why keeping the following three things in mind when you are having your home built can end up saving you a lot of money on operating costs, not to mention reducing the home's impact on the environment. By installing energy efficient windows, by ensuring that your attic is properly insulated, and by using a high-efficiency furnace and water heater, you can help make your new home energy efficient and more comfortable.

Windows are an important design element in your home and everyone wants to have the best view from inside their homes. But windows can be a significant potential energy loss. A picture window in your home's living room can provide a stunning view and using energy efficient windows will help to keep thermal transmission to a minimum. This way, your living room can stay warm in the winter time and cool in the summertime without costing a fortune in heating and electrical bills. Talk with your builder about the his recommendations for the windows you want to make sure that they are energy efficient.

Attic insulation is another thing that can make a big difference towards ensuring a home is energy efficient. Heat transmission through a poorly-insulated attic can cause your heating and cooling bills to skyrocket. Insulation is rated in Canada by its "R" value, which is a measure of how well insulation resists transferring heat. Although building codes require at least R35, I would suggest insulating up to at least R50 standard to have an energy-efficient home and would encourage you to talk with your builder for more details.

Finally, high-efficiency furnaces and hot-water heaters are a must. Most if not all new furnaces sold in Canada today are high-efficiency as are hot water heaters. Also, the relatively new tankless hot water heaters allow you to heat only the water you need when you need it and can help in making your home more energy efficient than the standard hot water tank. Again, speak with your builder about the type of furnace recommended for your home, as well as the type of water heater.

By insisting that your new home has energy efficient windows, proper attic insulation, and high-efficiency furnaces and water heaters, you can make sure that your home is energy efficient, and that will not only save you money but will help the environment as well.

Movember at Vantage West

Great news. The guys at Vantage West are willing to look a little more ridiculous than usual for a good cause. They’re taking part in Movember, (as in “Mustache November”) a fundraiser for prostate cancer awareness.

Vantage West Co-founders AJ Hazzi and Joel Sherlock will be among the men proudly sporting shag carpeting on their upper lips while keeping the beards tidy. Given that I’ve never seen an Egyptian moustache, I’m excited to see where AJ’s takes us. Joel on the other hand, looks like he could be sporting a Tom Selleck-thick cookie-duster by breakfast tomorrow.


The team is hoping to raise $10,000 for a cause best described by the Movember.com website:
“The moustache becomes the ribbon for men’s health, the means by which awareness and funds are raised for prostate cancer. Much like the commitment to run or walk for charity, the men of Movember commit to growing a moustache for 30 days.”

And grow they shall.

Periodic updates will post on the Vantage West Facebook and Twitter accounts so we can all chart the awkward progress as it happens.

It’s a light-hearted way to address a serious problem, and they would appreciate any and all support from those who believe that the power of the moustache can help fight back against prostate cancer.

You can make your donations at: at this Mospace Page using a credit card or Paypal account in approximately the time it takes to wax a quality curly-tipped mousty. So...

Thank you for your support!

The team at Vantage West

A Billion Dollar Home?

I feel as if I need to channel Dr. Evil from the Austin Powers movies a bit when I utter the price of the home that has been built in India. A few years ago, it has hit the news and some of you may have already heard about it when it was designated as "The World’s First Billion-Dollar Home. As of this week, that claim to fame is now a reality as the home is completed and ready to welcome its owner, one of the richest men in the world, Mukesh Ambani. 



Ambani is the chairman of Reliance Industries, which is India’s largest private sector company. His personal wealth is estimated at about $29 billion and Forbes named him the 2010 fourth richest man in the world.

A look back in time shows that the home seems to have all the features noted in the original plans. Soaring 27 stories and 570 feet high, it towers over much of its surroundings, with glass walls taking full advantage of its stunning position in the center of downtown Mumbai, with views stretching to the Arabian Sea. Six garage levels sit below the residence, providing garage space for approximately 160 cars. No doubt Ambani, his wife and three children, plus the 600 staff members reportedly hired for this building/residence will have no problems with parking…or perhaps Mr. Ambani can fill those spots on his own? Some published reports say there is a full-service auto maintenance center that comprises one floor of the tower.



While there is some question as to exactly how much the home is worth (which seems to be anywhere between $1 billion and $2 billion, according to many analysts), there seems to be little question as to the level of amenities this mansion in the sky affords. Named Antilia, after a legendary island in the Atlantic Ocean, this palatial building took seven years to complete and begins with the home’s lavish “lobby,” offering nine elevators. The home’s reported 37,000 square feet include such features as a two-story health club, a 50-seat theater, a ballroom and a four-story hanging garden. Other highlights include multiple safe rooms, a dance studio, a swimming pool and the three heli-pads on the roof.



What more can one say?



Source from: Kathleen of Unique Homes

Largest Residential Sale in Kelowna's History - $10 million property sold.

By Steve MacNaull

Thursday, October 7, 2010


An aerial view of the 29 acre parcel at 5880 Lakeshore Road that has changed hands for $10 million.

What real estate slowdown?

A 29-acre waterfront super-estate has just sold in Kelowna for $10 million.

“It‘s good news, really good news,” said Gary August of Coldwell Banker Realty, who co-listed the property with realtor Jane Hoffman.

“It shows that Kelowna is still a desirable real estate market and wealthy people are more than willing to invest here.”

At $10 million, 5880 Lakeshore Rd. is the most expensive single-family home to ever sell in the Central Okanagan.

The record was previously held by the lakefront mansion at 1499 Pritchard Dr. in West Kelowna that sold in early 2008 for $7.4 million.

“Not many properties sell at these price points, so they are big deals, something that everyone sits up and takes notice of,” said August.

The $10-million transaction is somewhat shrouded in secrecy.

The confidentiality rules that bind realtors means that August is only comfortable revealing that the seller is from out-of-town and used the property as a second home over the past 30 years.

Realtor A.J. Hazzi, a partner at Vantage West Realty, represented the buyer.

“He‘s from Calgary and is involved in the oil and gas industry,” said Hazzi.

“He knew what he wanted – a big private estate on the lake – so when found it everything moved quickly.”

Hazzi was introduced to the buyer after helping a friend of his find a home in Kelowna.

“This reinforces two things that are very important in Kelowna real estate,” explained Hazzi. “Even with the recession, Alberta buyers with oil and gas money are still our big buyers and referrals are the best way for realtors get business.”

The 29-acre parcel is actually an amalgamation of three properties, all in the Agricultural Land Reserve, so there are no plans to subdivide.

“The buyer wants to turn this property into a world-class estate,” said Hazzi.

“There is a 5,500-square-foot house on the property that would have been the best when it was built in 1972, but the buyer has already lined up a local builder to build his dream home for him. What drew him to the property was the privacy, the views and the location right on Okanagan Lake with 1,100 feet of waterfront, a private breakwater and five-boat slip dock.”

The buyer also plans to have a couple of golf holes put in and plant some grapes to one day make wine.

While $10 million is the biggest sale for a single -family home, there have been some larger for commercial properties.

In 2004, the land where the Mission Creek Towers are now at the corner of Springfield and Durnin roads changed hands for $12.1 million.

And just last year, a 120-acre waterfront plot on Westside Road that will be developed as a marina, hotel, restaurant and winery sold for $18 million.

The property is located just north of the former Old Ferry Dock and will be turned into a 1,350 -boat marina with automated underground dry stack storage system and have a floating restaurant, 50-room boutique hotel, vineyards and winery.

A group of investment partners from Vancouver and Calgary, headed by retired dentist and former Kelowna-Lake Country Liberal MLA John Weisbeck, is behind the development.

The project will be developed in phases over the next several years starting with the first of the marina slips and the restaurant.

3 Level Penthouse at Club Fuzion Kelowna

Luxury Home Market Shatters Records

Greater Vancouver topped the charts for the most expensive home sold in the first quarter of 2010, while prices for luxury properties in 9 of the 13 markets shattered records.

A recent report form the real estate council stated that nearly all marketing reported double to triple digit price increases in the firs quarter for the upper end on of the housing market. Kelowna lead the gains with prices surging 700% Followed by Montréal at 300% and Victoria with 275%.

“Recovery in the upper end has been nothing short of remarkable,” stated Elton Ash, “This segment of the market was hardest hit when the recession took hold – yet its comeback has been fast and furious.”

Foreign buyers, particularly from the Middle East and China, are also helping buoy sales at the upper end of the market, with investors attracted by the stability of the Canadian financial system and the beauty… did you see the Olympics?
This report also speculated that the economic recovery coupled with the rebound in stock portfolios has helped boost the number of high net worth individuals who are reaching for their wallets.

The most expensive home sold through the MLS listing system in the first three months of the year was an 11,600 sq. ft. property in Vancouver’s Westside, which fetched $10.6 million, it said.

The Bank of Canada last week predicted that the feverish property market would begin to cool in the second half of this year as higher interest rates, tax in some markets and tighter mortgage rules dampen demand.

These are not factors likely to affect the higher end of the market, however. Greater Vancouver topped the entry-level price for luxury homes with the sales tag starting at $2 million, followed by $1.5 million in Toronto and Montreal

Okanagan housing market picks up.

The Central Zone of the Okanagan Mainline Real Estate Board reported March 2010 sales activity of all MLS property types improved over 2008, the early part of 2009 and last month as the local housing market continues to pick up steam moving into Spring.

“Sales activity remains strong and listings continue to increase in the Central Okanagan as Spring unfolds and the promise of warm weather spurs Buyer interest,” says Brenda Moshansky, OMREB President.

“New listings rose 27% over last year at this time (1,362 compared to 1,070) and are up 12% over February (1,098). A wider selection of properties means more choice for buyers and a better opportunity to find the dream home they are looking for.”

She says overall sales of 366 units this month jumped 49% from the 245 sold in March 2009 and rose 26% from the 289 sold in February.

Total residential units sold showed a 42% improvement over last year at this time (331 compared to 233) – a 33% increase from last month (249).

Sales of 172 single family units were up 32% over last March (130) and increased 34% compared to sales this February (123).

Townhouse and apartment sales continue to show improvement, rising 85% (63 townhouses sold compared to 34) and 19% (56 apartments from 47) over March 2009.

“As economic growth improves in BC and recovery is well underway across the country, mortgage rates have gone up with the anticipation of potentially higher inflation. Despite the increases, home prices remain relatively affordable and mortgage rates comparatively low in the Central Okanagan – factors that will continue to draw buyers into our attractive market and to strengthen sales.”

She says they expect to see buyers with pre-approved mortgages making a move before the upcoming changes to qualifying criteria come into effect in mid-April.

“And, others could jump in sooner rather than later in the coming months to avoid further rate increases and the pending HST.”

These intrest rate changes won't hurt a bit.

Its important for Kelowna Home Buyers to understand that when the minister of finance is talking about a bubble and trying to prevent the market from over heating, its major centres like Vancouver and Toronto that are driving these decisions. Kelowna Condo sales hardly reflect the speculative market we saw in 2003-2007. Okanagan real estate market is in a very balanced place right now.

The mortgage rule changes announced Monday by Financial Minister Jim Flaherty will weigh a bit on real estate speculators and heavily indebted people who want to fold
their high-rate credit card debt into a lower-rate mortgage. But for rank and file homebuyers, the changes will barely be perceptible when they take effect on April 19, 2010

“This should have a limited impact on what I see daily,” mortgage broker Peter Majthenyi said in an e-mail he fired off after Mr. Flaherty's announcement. “I believe it's more a message that ‘Big Brother' is watching and cares.”

Olympics aside, the favourite Canadian diversion of the moment is to debate whether there is a bubble in the housing market. Those most worried about the housing market plunging have urged Mr. Flaherty to raise the minimum down payment for a home and reduce the maximum payback period.

But the 35-year amortization, favourite of first-time buyers across this land, remains. So does the 5-per-cent down payment, which is heavily relied upon in high-cost cities like Vancouver, Calgary and Toronto.

All the measures announced by Mr. Flaherty affect mortgages covered by government-backed mortgage insurance, where the buyer puts less than 20 per cent down. The key change for typical home buyers is that, regardless of what term or type of mortgage they choose, they'll have to be able to afford the five-year rate.

New Mortgage Regulations from Finance Minister Jim Flaherty

Finance Minister Jim Flaherty announced Tuesday he will be issuing tighter lending standards for mortgages, saying that while the housing market is “healthy” the moves are needed to “help prevent negative trends from developing.”

Under the new rules, all borrowers will need to meet standards for 5-year fixed-rate mortgages regardless of whether they're seeking a loan with a lower rate and shorter term.

Also, the government is lowering the maximum amount Canadians can withdraw when refinancing to 90 per cent of the value of their homes, from the current 95 per cent, and requiring a 20 per cent down payment for government-backed mortgage insurance on “speculative” investment properties.

“There are no definitive signs of a housing bubble,” Mr. Flaherty said. “We think we're being pro-active in the three steps we're taking today.”

Frank Techar, the President of Personal and Commercial Banking for BMO Bank of Montreal, welcomed the announcement.

“While we do not believe that Canada faces a housing bubble, we fully support the minister's actions,” Mr. Techar said in a statement. “Given the prospect of higher interest rates and the recent run-up in housing prices in some markets across Canada, the measures announced today are prudent. Currently, we require high ratio mortgages to be able to qualify using the 5 year rate.”

In a release, the finance department indicated that the three new changes to the mortgage insurance guarantee rules are intended to take effect April 19, 2010.

In reference to the tightening of re-financing rules, Mr. Flaherty said this will encourage Canadians to build equity in their homes instead of tapping that equity as a source of cash.

“This will discourage the kind of mortgage refinancing that can create unsustainable debt levels as interest rates go up. We are encouraging people to build equity over time, using home ownership as an effective way to save, rather than as a vehicle for quick cash,” he said.

In his comments on the third measure, Mr. Flaherty said the hike in minimum down payments for such properties will help keep prices from climbing too high.

“We will require a minimum down payment of 20 per cent for government-backed mortgage insurance on non-owner occupied properties purchased for speculation. This will discourage the kind of reckless real estate speculation that can drive prices to unsustainable levels which does not serve Canadian home buyers,” he said.

“We're not aiming here at investment properties,” Mr. Flaherty added. “What we're getting at is the speculation in multiple-condo markets, in particular.”

CIBC economist Avery Shenfeld said “these look to be very well targeted at the one area of concern that we have, which is that low rates are making larger variable rate mortgages look more affordable than they really are on a long term basis.”

The moves send an appropriate message to borrowers about debt, he said. While the rules don't take effect yet, Mr. Shenfeld suggested that the banks might begin adopting them earlier. And they could take a little bit of steam out of the market, he said.

“It may be part of a cooling that we'll see in house price appreciation,” he said. “We were pushing into house prices that were running a bit ahead of rental rates and income fundamentals – not to the point that we feared a huge house price crash, but to the point that it might be time to head-off such risks.”

Jeremy Torobin, Bill Curry and Tara Perkins

Globe and Mail Update

Marketing your Home on the Internet

There are many Marketing Questions to Ask the Real Estate Agent Who Is Offering to List Your Property for Sale. With almost 90% of property buyers searching online for real estate, you'll likely be best served by an agent who understands modern Real Estate web marketing techniques.

• Are you using a professional photographer to capture the best photos of my property?
o How many photos of my home do you intend to post on the web?

• Do you post to Craig’s List, Castanet and Kijiji? Will your ads divert that traffic to more effective website?
o How often will you repost

• Do you use Facebook ad impressions? How will they be targeted?

• Which keywords will you target as part of the Google adwords and/or Bing campaigns will you run for the property?

• Will you post my property to your blog and update your readership at least twice/month with updates etc?

• Can I see the MLS description you plan to write for the property before it is posted? Is it written by a professional copy writer?

• Are you willing to notify the 10 agents who have the most recent sales on properties closest to my property about the listing?

• Which social networks will your blog posts about my listing syndicate to? How many total people do you have on your friends/fans/followers lists?

• Will I be able to access web tracking for the various sites where my listing appears? Can you set me up to be able to view these visitors in real time?

• Can I send your presentation online to my address book of contacts?

• Are you willing to provide a Satisfaction Guarantee

Agents are often chosen solely on the recommendation of a friend or maybe an ad in the newspaper. But choosing the right agent can save you time, effort and aggravation. No matter the source if the agent does not have a marketing plan or does not have a strong grip of real estate marketing in today’s world of tech savvy buyers, how will this agent ensure that your home gets into the hands of as many buyers as possible? Exposure is Key.

If you are thinking of selling real estate in Kelowna or the okanagan? Would like a Vantage West Realty Agent to spend some time with you and show you our extensive property marketing system? Or if you have any questions about marketing your property in your home town please feel free to contact us at info(at)vantagewestrealty.com or 1.877.817.3133

10 ways to improve the value of your home

After you have taken the time to evaluate your real estate professional there are a few more important items that you may want to take a good look at to ensure you are getting the most for your home.

Whether it’s to prepare your property for selling, or even just to enhance the enjoyment of your single largest investment.

Here are 10 ways you can increase the value of your home.

• 10: Showcase that view in an out Purchase New Windows. They not only add to the value of your house, be GREEN and save money by keeping your home more energy efficient.
• 9: Bring your family room up to date, buyers love open space, maybe enough room work out with the Wii! — a feature potential buyers will love!
• 8: Clean up the Kitchen. Yes insides of your kitchen drawers too. Try adding rollout trays and other organizers. Save some space, and make them more attractive to buyers.
• 7: Consider investing in a power generator, to keep the light on, when the electricity goes out! Stand out from the competition
• 6: Do a ‘floor space audit’ in your home. Look for square footage that isn’t being used, or used well, and try to put it better use. With some drywall and a bit of imagination, you can add a new room at little cost.
• 5: Add a deck! One of the best ways to add value is to create a brand new room outdoors! And just think, your grille will love you for it. That Kelowna lifestyle is all about the balance of indoor and outdoor living.
• 4: Upgrade your garage door opener to a keyless touchpad entry system to provide a bit of convenience and high-tech flair!
• 3: Fix up that basement. Whether you do a whole renovation or just a fresh coat of paint, it’s not a dudgeon. It will make a big difference in the value of your home.
• 2: Consider using that attic space for more than just overflow storage, try adding a room. You’ll see a big return on your investment, there.
• 1: Let there be light! Update your light fixtures – a small cost, for a big return!

Do you own Real Estate in the Okanagan? Call a Vantage West agent today we would be happy to help you with a custom list for your home!

BC Real Estate Market Update - Interest rates and inflation...

Real estate activity has been blistering in recent months, fuelled by record low interest rates. The Bank of Canada stated this month it will keep its key lending rate at 0.25 per cent through to mid-year unless its inflation outlook changes.

The flurry of activity has sparked concern about housing bubbles though. The heads of the country's six largest banks have expressed concern over a potential slide in house prices and said they want Ottawa to tighten rules on mortgages, reported The Globe and Mail Saturday.

Finance Minister Jim Flaherty seems to have no near-term plans to tighten mortgage rules.
“Right now, there is no compelling evidence of a housing bubble in Canada,” he told reporters this weekend, though “we're continuing to watch” how the market evolves

HST Real Estate Update

The HST has been looming large in the minds of prospective homebuyers. A recent IPSOS Reid survey indicated 40 per cent of B.C. Home Buyers believe the HST will impact their home buying plans. The question is, how big of an impact will it have?

The jury is still out on exactly how the HST will affect the overall housing market. However under the current proposal a homebuyer purchasing a used or resale home will see only a marginal increase in their actual costs.

According to Tony Spagunolo, “The average buyer purchasing a used home will see an increase of maybe $100 if the HST is implemented in the current form.” Spagunolo owns, The Spagunolo Group of Real Estate Law firms, and specializes in Real Estate conveyance.

When you break down the numbers it becomes apparent Tony is right.

Buyers only pay GST on new real estate. Therefore a resale property should not be subject to HST. Legal fees already include GST and PST therefore will have no change.

The only additional cost will be on home appraisals and inspections. Home appraisers and inspectors currently only charge GST. In the Okangan an appraisal can cost about $300 while an inspection is around $175. The total GST on both is currently $23.75. Once the new rules take effect July 1st, 2010 the total tax will increase to $57.00 which is an increase of only $33.25.

Who will the HST hurt the most?

Sellers will actually pay quite a bit more HST than buyers. Sellers pay Real Estate commissions which are subject to GST. Considering the average $400,000 sale generates a commission of around $16,000 the HST will add an additional $1,120 in tax. Not a small sum, but probably not enough to prevent a sale either.

Perhaps the single group most likely to feel the pinch from the HST are homebuilders. In particular builders who have a building completing after July 1/2010 will be the most impacted. There is a transitional tax planned for these buyers, but rest assured the builders, or more likely buyers are going to absorb some of the new tax.

It seems the provincial government is convinced more tax is the cure for what ails us. Whether this is the case still remains to be seen. At least homebuyers purchasing re-sale real estate can breathe a collective sigh of relief since the increased cost of the HST will be less than a less than a pizza and a six pack of beer

-Scott Peckford – Mortgage Architects

More Kelowna Real Estate News at Vatage West Realty.com
http://www.vantagewestrealty.com

VIew More Kelowna Real Estate Listings at www.vantagewestrealty.com

Kelowna Real Estate Quote of the Day

"No house should ever be on a hill or on anything. It should be part of the hill. Belonging to it. Hill and house should live together, each happier from the other." Frank Lloyd Wright

To view more incredible Kelowna Real Estate visit Vantage West Realty.

CHMC Kelowna Real Estate Update

KELOWNA - JANUARY 11, 2010 – CMHC

Kelowna area housing starts totalled 657 homes in 2009, down from 2,257 homes the previous year, according to Canada Mortgage and Housing Corporation (CMHC). Fewer multi-family homes accounted for most of 2009’s decline. “Strong price competition from a well supplied existing home market and high inventories of new, completed and unoccupied units constrained apartment condominium construction in 2009,”.

Kelowna’s new home construction market ended the year on a positive note. December housing starts, led by the detached home sector, increased to 72 units from 28 units in 2008. “Detached home starts have begun to trend back up in recent months,” noted Fabri. Both detached home and multi-family starts are expected to move higher in
2010.

For additional valuable real estate information please call or email a Vantage West Real Esate professional info(at)vantagewestrealty.com

Vantage West