So today I am going to go off the path a bit, and talk about the new waste collection system in Surrey.  Many people are not happy, as they think the containers are too big…or it’s too hard to separate.  I have two thoughts:

1)  Change is never easy, but I also didn’t realize how much stuff I used to throw out, that could have been composted.  So I think this is a good move for the environment.

2)  I love apps.  Really, who doesn’t?  Did you know, there is a app you can download for this new waste system:  itunes:  MyWaste.  It’s is awesome.  It gives you schedule, and set reminders, which is good because recycled goods and garbage alternate weeks.  But the cool part is the search function.  Don’t know if you are supposed to compost something or recycle it, look it up…AWESOME!

In summary, environment good…I love apps.

The title of this article:  Globe and Mail:  Mortgages and loans – harder for the self-employed? can be so true these days.

If you’re self-employed your pay cheques fluctuate, your accountant helps with the greatest tax benefits, which can result that your income you pay taxes on, doesn’t truly reflect what you “took home”.

But I think they really missed the boat, by only interviewing people that work at “institutional” lenders.  One that works at a credit union, and one that works at RBC, who’s “best advice” is to “have a relationship with your bank”…of course that is his advice, that is the only way he makes money.   Wouldn’t RBC like that?  If you just had blind faith that they would take care of you and give you good advice.

I have a better idea, how about the best advice is to work with someone who actually knows what they’re talking about.  Think about this, not only does the person you are talking to at the bank, only have the options of that bank, they also have never been self-employed.  They have no idea what you go though.   Whether they do a good job or not, they get paid, they get their nice little pay cheque each and every two weeks.

Don’t get me wrong, as someone who is self-employed I do value my relationship with my banker…not my bank.  My small business banker is great, he “gets it”.  However, I am not naive to think that my bank (one of the big five) actually cares about me.  If my banker left…I would most likely follow him.

Here is some REAL Advice:

1)  Work with someone who has some experience actually being self-employed.  Someone that understands the ups and downs and that can relate to what you go through every day, and is willing to fight for you.

2)  Just because your banker asks for your financial statements and tax returns, doesn’t mean they actually know how to read them.  Work with someone who has intimate knowledge of financial statements and tax returns, so they can present your case in the best light.

3)  Work with someone that actually has a selection of lenders and products, so if one doesn’t work, you have the peace of mind knowing there are other options.

4)  Have a good accountant.

Financial Post:  Financial Advice from Wayne Gretzky

As a kid growing up in the 80’s and 90’s in BC, we grew up detesting Wayne Gretzky, it seems he broke every record against the Canucks.  It was painful.  As I got older, I could take the emotion out of it, and just appreciate how great he was.  So when there is an article about money and Wayne…I was in.

There isn’t a whole lot to take home here…but the one thing I really appreciate is how he leans on people.  He lets people who know money, help him with money.  Everyone can’t know everything.

It begs the question, if you get your mortgage directly from your personal banker…are you getting the best advice?  Seriously.  How can they really be experts in banks account, investments, insurance, mortgages, etc…take it from Wayne, get experts in each category, not just an all in one.

So many times, all we focus on is the costs of buying a home, but the reality, I think you have to be just as carefull if not more, when you sell.

I have created the video below, to help sellers make sure they are making the right decision.

Click Here For Seller Mistake Video

So, it’s Monday and I am scrolling through the news, and my eye is always drawn to any article about mortgages.  This one was really interesting in the Globe and Mail:  What if mortgages were more expensive and less accessible?

It paints a pretty scary picture…however, one that I don’t think will happen, at least not overnight.  The sheer impact would be catastrophic.  Would/could it happen?…in time, maybe.  But if it does, it will be will with steps like we have seen.  The insurers have reduced amortizations on mortgages with less than 20% down, to 25 years.

If they were to make a next step, it will be to increase the minimum down payment from 5% – 10%.

So what should you do? 

Take charge of your situation.  Be in control. 

1)  Having a financial plan and start saving now.

2)  Make sure when you buy a home, you can be there for 7 – 10 years.

3)  Until you have 30% equity position in your home, be aggressive paying it down.  Have a PAYMENT PLAN!

Or at least have someone that you trust read the fine print.  This has never been more important than it is now in the mortgage industry.  You see, people are choosing their mortgage broker, and mortgage product based on marketing and advertising alone, and not doing any further research.

The old adage, “if it is too good to be true it probably is”, applies here.  You see some brokers and lenders are offering really low rates…lower than the average.  When you see this, it is a good idea to find out what the mortgage is really about.

Here are the top 3 ways, not reading the fine print can hurt you:

1)  The mortgage is completely locked in for any length of time (usually 3 years).  If you sell, you can get rid of the mortgage, but other than that, you are STUCK.  No refinance. No changes, nothing.  With this one, they really got you buy the you know what’s.

2)  No pre-payment privileges.  This could cost you over $10,000!  Even making small extra payments can save you so much money.  My clients are on payment a plan, which puts them light years ahead; however, you cannot do any of this without pre-payment privileges.

3)  Not portable or assumable.  They are features that are going to be increasingly awesome, as rates rise in the future.  Think about this.  You don’t want to live in your current place in 3 years.  Rates are now 5%.  If you mortgage is portable, than you can move to a new place, and take that mortgage with you.  If you mortgage is assumable, then it can be taken over by a qualified buyer.  Think about that…you are trying to sell your home (in 3 years), and there are 5 other homes similar to yours for sale, but instead of taking the 5% currently offered in the market, they can have your 3.09%.  Makes your home look way more attractive.

By not having these options you are leaving thousands of dollars on the table, letting the lender control everything you do, and potentially putting yourself in a really tough spot in the future…for what, so you can brag about you low rate?  I’ll take the thousands in savings, thanks!

In this recent article in the Globe and Mail:  Should young Canadians with home ownership dreams keep dreaming? It discusses that the average home in Canada will be $553,000 in 2020, and saving 5% down could be a tall test…I don’t disagree.

I really enjoy the part about budgeting.  But this might not be enough.

I think as parents, we can really set up our kids to win.  Whether it is helping pay for school, or a down payment on a home…we have the means to help them, if we start early in their lives.  Whether it is a RESP or some sort of savings…we can really help them.

What are your thoughts?  I know I have a financial planner, who’s knows it is one of my goals to assist my children this way and has made a perfect plan to achieve this.

Although not directly mortgage related, this article caught my eye. Financial Post:  IS this long-distance commute worth the expense? ,mainly because I used to have to commute. 

I used to drive from South Langley to West Vancouver.  I was in traffic anywhere from 2.5 hours to 4 hours a day.  At the time, I didn’t mind because I was starting my career, and got to work with a great mentor…so this was the distance I had to travel.  Not to mention, I had no children.  There were some moves in the meantime getting myself a bit closer, which got me down to an hour each way.  I even tried leaving a 5am and this actually shrunk the commute in the morning to 30 minutes!

However, there was always a strain on my family/personal life.  If I didn’t leave early to get home, I wasn’t home until 7 – 8pm.  If I did leave early, I got home around 5…but then was exhausted at 8pm from being up at 4:30am.

Fortunately for me, eventually I was able to move my work closer to home.  It is now 8 years later.  I work about 5 minutes from home.  I also now have two small children.  I would not trade my time with them each day for anything…especially not a commute.

Everybody’s circumstances and desires are different.  Some don’t have the choice to move their job.

How far do you commute?  Is it worth it?

As many of you know, I love to pick on the media.  Whether it is a misguided opinion, or one that is just flat out wrong.  But today, in the Financial Post, John Greenwood got it right with:  “Clearing The Fog on Housing”

And he got it right by point out something that is actually quite obvious…there is no clear direction.  You have “experts” with equal knowledge and experience stating sometimes the polar opposite opinions.  We hear things like the housing bubble is going to explode, and then the next day about the “balance” in the housing market.

I think I am just going to stick with my thoughts from the other day.  Housing is a long-term investment, something that you need to buy, and hang on to in order to see a great return.  The longer you hang on, the more you will see.   Don’t place on a minimum of 3-5 years on a property, plan on a minimum of 7-10 years.  If you can take on this approach…housing will be just fine.

This is actually a tough question.  I was reading this article in The Province:  Buying U.S. eggs costs B.C. economy $3.1 million a year: marketing board

It got me thinking.  My family has a place in Birch Bay, and we are down there almost every weekend in the summer.  We are a young family; living in some of the most expensive real estate in the country.  With expensive living costs, a struggling economy, and two kids to feed.  You have to cut costs where you can.

For us, when we started doing a majority of our grocery shopping in the States, we took our grocery bill from $800/month to $450/month.  That is HUGE!

I understand how much the BC economy needs residents to support local business, but the family first, right?

What are your thoughts?