BARBARA GRUMME’S BLOG!

Beware the pitfalls of a hectic lifestyle. This is about being too tired and rushed to plan meals and as a result, eating out too often. Many families find planning out the weeks’ meals on the weekend is efficient and saves a ton of money (and calories) from take-out.

Another pitfall of double-income families is a feeling of entitlement. This leads to increased impulse buying and ‘retail therapy’. Whatever you call it, it eats away at your savings and budget. Again, the key is to plan before you get to the mall, and that includes planning the splurges. Decide ahead of time how much discretionary money you have to ‘play’ with and don’t exceed it. It’s best if you carry the discretionary funds as cash. When the cash is gone, it’s time to go home!

Information was by Kickstarters.ca

Let’s talk about Love Money

Ponder that for a moment: If you want to stay happily coupled, you need to talk about your finances. Since you and your partner have chosen to be together, you probably already see eye to eye al all of life’s moral, material, recreational and economical issues.

If only.

Few, if any, twosomes agree on all life’s joint decisions. At the extreme, well, you’ve heard how it goes. The more you talk (Rationally, please!) about finances, the richer you’ll be.

Resolve to do things differently. à just because you and your partner have had difficulty with money discussions before doesn’t mean you can’t make progress now. Bring a does of optimism along with your resolutions. What will you discuss?

Consider the following

• Your big financial goals
• Creating a budget both of you can live with
• Where you can cut back on spending
• What may tempt you to break the budget

Set a date à Pick the settings for your Money Talk. Then decide on a reward that you would like to share when you’re done with your first Big Money talk.

Make an emergency relationship repair kit à Take a box and place inside it items that will help you get over a spat with your spouse. You may want to include coupons for eating out, a pair of movie tickets, some old love letters, a poem, a book of jokes, or your wedding photos.

Set your ground rules:

• Agree to try
• Accept equal responsibility for changing your lives.
• Don’t play the blame game.
• Be honest
• Take a break if the conversation turns heated and unproductive.

Use the “Getting in the mood (For a Money Talk)” worksheet to pt down on paper your commitment to a productive money conversation. If the conversation becomes heated, cool down. Review the ground rules, them set a follow-up date to talk. And don’t use this rule as an excuse to avoid tough topics.

 Have you and your spouse fill out the following then compair together at the end!

Getting in the Mood (For a Money Talk)

Date:

Setting:

Refreshments:

Reward:

Emergency Relationship Repair Kit Contents:

Group Rules

(As a first step towards compromise, take turns proposing rules.)

1. ____
2. ____
3. ____
4. ____
5. ____

1. Who is responsible for balancing the checkbook?
2. Who is the long-term planner?
3. when was the last time you make financial whoopee? Or at least talked about your finances?
4. On a scale of 1 to 5 (1 is “Not very” and 5 is “very”) How important is it that you and your partner:

________Cut coupons

________ Go to the gas station with the lowest prices

________ Rent videos instead of going to the movies

________ Comparison shop

1. How much is too much to spend:

________ On going out to dinner?

________ without talking to your partner first?

________ On gifts (for each other, for children, for relatives and friends)?

________ On vacation?

1. If you inherited $10,000, it would be most important to:

1. Pay off debt
2. Buy a new car
3. Invest the money
4. Take a vacation
5. Thro an awesome party for your relatives so that they can see what a great niece, granddaughter, and 19^th cousin you are?

1. If your spouse’s money personality were a superhero, which superhero would it be?
2. when do you expect to buy your next car? Will it be used or new? What kind?
3. What are your top three long-term financial goals?
4. Harry Patter vs. Spider –man. Discuss.

Results:

Now it’s time to take your financial temperature. As you compare answers, note where you agreed and disagreed.

• Were you able to get through the first 5 questions without having an argument? Congratulations! You two could put the “gold” in golden years.
• Did you laugh some, cry some, yell a little bit? You’re communication, all right. The “Getting in the Mood” worksheet can help you and your partner to find less volatile ways to get fiscally fit.
• Was your financial whoopee less satisfying than you’d hoped? Don’t give up. Stick with it.

Information by:

Dayana Yochim

Money Manager Digest for you!

Get ready for steep rate hikes in 2011: economist

OTTAWA — When the Bank of Canada does start raising its key policy interest rate in either late 2010 or early 2011, Canadians should brace for “aggressive” increases of up to a percentage point at a time, says a report from the chief economist at Laurentian Bank Securities.

The call, from Carlos Leitao, adds a new wrinkle to the debate as to whether the central bank will be able to keep its pledge to leave its key policy rate at 0.25%, or the lowest level possible, until June 2010 in an effort to stimulate the economy. This analysis kicks off a debate in terms of how aggressively the central bank needs to act once it believes rate increases are in order.

The Montreal-based economist said he believes Mark Carney, the Bank of Canada governor, will be able to keep his June 2010 promise, based on the amount of spare capacity in the economy and continuing job losses that are likely to peak early next year.

The Bank of Canada is likely to begin hiking rates after unemployment peaks (in early 2010) and before inflation hits the preferred 2% target (sometime in mid-2011). Once that period comes, Canadians should prepare for steep rate hikes.

“An aggressive tightening – rather than a gradual one — will be necessary because rates are extremely low,” Mr. Leitao said in LBS’s weekly note to clients released Wednesday. “A ‘measured pace’ would not be appropriate to ‘normalize’ rates when the starting point is virtually zero.”

Analysts say one of the key causes of the financial crisis was that the U.S. Federal Reserve kept its key policy rate too low for too long. When it did begin raising rates in 2004, they say, the Fed opted by gradual increases of 25 basis points – not nearly aggressive enough, in retrospect, to cool down the white-hot housing bubble that resulted in the financial market meltdown almost a year ago.

Mr. Leitao said should the Bank of Canada take a similar path like the Fed did earlier this decade, its key policy rate would be at just over 3% by the end of 2011.

“This could well prove to be too low for an economy that would be running at a decent pace with inflation already at the 2% target,” he said. “This means we are likely to see a mix of 50, 75 and even 100 basis points hikes — when the time comes.”

The Bank of Canada releases its latest interest-rate statement on Thursday, and analysts are near unanimous that it is unlikely to contain much change. The central bank will leave its target rate unchanged and reiterate its commitment to leave it there until mid-2010.

Information by

Paul Vieira, Financial Post 

Here an article I found that I think will interest all of you as far as how rates are likely to go in the next while.

Rates Flat Till 2011?

 Here are some of the more notable interest rate and housing-related headlines from the past week:

Central banks signal low rates here to stay Recession may be over but growth will be limited next year: CIBC Worst is Over for Housing Market, Economists Say Among the takeaways…

CIBC economist, Avery Shenfeld, proclaims: “Canada’s inflation rate will be no threat to the Bank easily fulfilling its pledge to keep interest rates at a slim quarter point through mid-2010. In fact, market expectations for rate hikes in the first half of 2010 could be a full year too premature.”

Bank of America Securities-Merrill Lynch says it does not expect the Bank of Canada to begin raising rates until 2011.

National Bank economist, Marc Pinsonneault, believes mortgage rates won’t rise over the next 12 month by more than 50 to 75 basis points from today’s 5.85% five-year fixed posted rates.

On the housing front…

TD economist, Don Drummond, says: “A similar pattern in [the US and Canada] is unmistakably suggesting we’ve not only bottomed in housing, but we’re on the way back up.”

BMO Capital Markets economist, Jennifer Lee, agrees, saying: “The housing market has clearly turned the corner.”

As usual, long-range forecasts are fraught with hazards, so the above should be placed under the “For what it’s worth” heading…

If you have any questions regarding this information or any other mortgage related info please give me a call and I will set up a time for us to get together.

Michael Brooks

Mortgage Agent, FSCO License #M08004068

Home Loans Canada, FSCO #10423

PH# 905-329-2223

Email: michael.brooks@hlcmortgages.com

Good Afternoon,

I found this item in my travels today. Hopefully you will find this interesting.

More young Canadians taking advantage of low interest rates in housing market By Luann Lasalle (CP) 1 day ago

  Younger Canadians are expected to lead the way with home buying this year as they take advantage of low interest rates, new jobs and what they consider “good prices,” a bank survey says.

The survey for the Royal Bank suggested that 15 per cent of Canadians between the ages of 18 and 24 were very likely to buy, almost double from eight per cent in 2009.

It’s a marked shift in the attitudes of younger Canadians, who have tightened their budgets over the past few years to cope with tough jobs markets and the recession.

“Our poll found that 35 per cent of younger Canadians, between the ages of 18 and 24, are intending to buy a home due to good real estate prices,” Marcia Moffat, RBC’s head of home equity financing in Toronto, said Monday.

The national average price for a home was $328,537 in January, according to the Canadian Real Estate Association.

Thirty-one per cent of 18 to 24-year-olds surveyed in the online poll said they would buy a house because of a new job. The survey also found 22 per cent in that young age group wanted to buy a home because they considered interest rates were good.

CIBC World Markets senior economist Benjamin Tal said more young people are getting into the real estate market, taking advantage of low interest rates, lower down payments and more years to pay off their mortgages.

Tal said he estimates the young people getting into the market as a bit older, between the ages of 22 and 28.

“Basically parents are begging their kids to buy now because they remember when they were paying 12 to 15 per cent mortgage interest,” Tal said.

“So there’s a sense of urgency to get into the market and young people are a part of it.”

Tal described the coming real estate market of the next three or four years as “boring.”

“I think that what we are doing now is that we are basically stealing activity from the future.”

The RBC survey also suggested that overall attitudes are changing as more Canadians return to shopping for homes as the economy recovers, even though it’s considered a seller’s market.

“Confidence in the housing market is back, essentially,” RBC senior economist Robert Hogue said.

Royal Bank said the study found more Canadians are “very likely” to buy a new home in the next two years.

Ten per cent of the 2,047 people of all ages surveyed for the study said they planned to buy a home within two years - up from seven per cent two years ago.

The RBC study also found that 91 per cent of Canadian homeowners believe a home is a good investment, the highest level in 12 years.

“At this stage last year, there was doom and gloom all around and it definitely affected the housing market,” Hogue said.

One-quarter of those surveyed, 26 per cent, said they expect their home to be their primary source of income when they retire.

However, the surge in optimism doesn’t necessarily mean that Canadians have forgotten about past economic troubles.

The survey found they are still more cautious when it comes to mortgages. Forty-four per cent of those surveyed who plan to buy a home in the next two years said they would take a fixed-rate mortgage.

Also on Monday, the latest new homes numbers showed that the annual rate of housing starts were up in February.

The Canada Mortgage and Housing Corp. said that the seasonally adjusted annual rate of housing starts reached 196,700 units in February, an increase from 185,400 in January 2010.

Senior CMHC economist Bill Clark said the market is seeing a lot of “catch-up” and consumers in Ontario and B.C. are likely trying to avoid the harmonized sales tax before the summer.

“So if you roll all of that together it’s really sort of one big recipe for housing starts to go up,” Clark said.

The report showed the gain was concentrated in the multiple starts segment, particularly in Toronto.

Urban starts increased nine per cent to 179,100 units in February.

Urban multiple starts increased by 19.1 per cent to 89,900 units, while single urban starts increased by 0.5 per cent to 89,200 units.

The annual rate of urban starts increased 28.6 per cent in Ontario in February, 14.3 per cent in Atlantic Canada, 10.8 per cent in the Prairies and by eight per cent in British Columbia.

In Quebec, urban starts fell 14.1 per cent.

Rural starts were estimated at a seasonally adjusted annual rate of 17,600 units in February.

In these important times you don’t want to lose any potential clients. Now is the time to make sure you help your clients out by recommending the best mortgage agent possible. My experience and knowledge of the mortgage industry has made me successful for over 10 years .

Michael Brooks

Mortgage Agent, FSCO #M08004068

Home Loans Canada, FSCO #10423

Good Morning,

I just wanted to give you this info that will help you be informed on the inflation issue and how it may effect our business.

Inflation jump causes more interest rate speculation

| Monday, 22 March 2010

Some experts are predicting Bank of Canada interest rate hikes are less than three months away after Statistics Canada reported core inflation jumped to 2.1 per cent in February. This compares to the central bank’s outlook of a 1.6 per cent average core inflation rate in the first quarter of 2010.

“We’re progressively leaving the recovery phase,” Yanick Desnoyers, assistant chief economist at National Bank Financial in Montreal told the Globe and Mail. He added policy makers “are going to change their tone on the economy in April, and they’re going to move in June. The longer they wait, the more aggressive they’ll have to be.”

Inflation wasn’t predicted to reach the Bank of Canada’s two per cent target until the third quarter of the year and some are saying the effect of the Olympic Games in Vancouver - which drove up costs, particularly in the hotel sector - caused the jump. The inflation numbers also contributed to a surge in the Canadian dollar, which hit a high of 99.38 cents U.S. on Friday.

“[This] report must be turning heads at the Bank of Canada,” economists Derek Holt and Karen Cordes Woods at Scotia Capital told the Financial Post. “While the details are mixed on the underlying components, it is pretty difficult to argue that emergency rates in Canada [of 0.25%] are still warranted.”

In contrast, the Post said economists at TD Securities don’t expect the Bank of Canada to over-react to the new number because “one-off factors” are well-identified.

In these important times you don’t want to lose any potential clients. Now is the time to make sure you help your clients out by recommending the best mortgage agent possible. My experience and knowledge of the mortgage industry has made me successful for over 10 years .

Michael Brooks

Mortgage Agent, FSCO #M08004068

Home Loans Canada, FSCO #10423

PH# 905-329-2223

Email: michael.brooks@hlcmortgages.com

Bank:

• Take basic information
• no verification
• little time with client

Mortgage Broker:

• Will run a credit Bureau
• Develop the application more thoroughly
• Ask for verification of income, ect..
• Develop a plan for the client to purchase the property

Information by: Barbara Grumme

Some banks will not finance these types of property’s

• Unique properties/ Handyman Specials or “As Is” (Exception - p.o.s.)
• properties less than 750 Square feet in size
• mobile homes
• Commercial properties or commercial zoning
• Industrial properties or industrial zoning
• vacant and agricultural land
• Condo-hotels, time shares, co-op’s, rooming houses, boarding houses
• working farms
• properties with cistern wells, (Ok if insured)
• Properties without well, septic or municipal services
• non standard electrical -100 amp service minimum

Information by

Barbara Grumme

A lending:

• CMHC, GENWOTH, AIG Insured
• Minimum Beacon Sore of 650 - 680
• 1 year job stability
• No derogatory creit information
• No appraisal
• Fees up to 2.75%/ higher on longer amortizations
• GDSR TDSR 32% - 42%
• Subject to Confirmation of various items
• Income, support, alimony
• Down payment - may be saved, borrowed or gifted depending on beacon

B Lending (alternative Financing) Sub Prime Market

• Rate is Beacon Sore Driven 600 - 8.25% 560 - 9.50%  4%fee
• TDSR as high as 50%
• Business for self up to 85% LTV Clients with 9 Sin#’s
• An appraisal must be ordered at all times
• appraisal must be reviewed/ approved by lender /results in delays requiring more time for financing condition

Information by Barbara Grumme

What information is required for a mortgage applications

Contents of application

Personal information

Address

Current employer

Annual income

Assets and liabilities

Declaration / Consent to verify information, access credit bureau.

Information by:

Barbara Grumme