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Mortgage Education Centre
Expert insights, practical guides, and local Alberta mortgage advice to help you make confident financial decisions.
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Getting a Mortgage
Unlock Tailored Mortgage Solutions with Tina Kha Mortgages
Navigating the Mortgage Landscape: Unlocking Opportunities with Expert Help Navigating the mortgage landscape can be overwhelming. Whether you are a first-time homebuyer or looking to refinance , finding the right mortgage solution tailored to your unique financial situation is crucial. Expert mortgage help can make all the difference in securing the best rates and terms. This blog post explores how personalized mortgage services can unlock opportunities and simplify your home financing journey. Why Expert Mortgage Help Matters When it comes to mortgages, one size does not fit all. Each borrower has different financial goals, credit profiles, and property types. Expert mortgage help ensures you receive advice and options that fit your specific needs. Mortgage professionals have access to a wide range of lenders and products, which means they can compare and negotiate on your behalf. For example, if you have a variable income or are self-employed, a mortgage expert can recommend lenders who specialize in flexible underwriting. They can also help you understand the implications of fixed versus variable rates, amortization periods, and prepayment options. Benefits of expert mortgage help include: Access to exclusive mortgage products not available to the general public Personalized financial analysis to determine affordability Guidance through complex paperwork and legal requirements Assistance with credit improvement strategies to qualify for better rates Ongoing support throughout the mortgage term Mortgage advisor providing expert help to a client How Tina Kha Mortgages Provides Expert Mortgage Help Tina Kha Mortgages is a trusted name in the mortgage industry, known for delivering tailored solutions that meet diverse client needs. Their approach focuses on understanding your financial goals and crafting a mortgage plan that aligns with your lifestyle and budget. By working with Tina Kha Mortgages , you gain access to: A broad network of lenders including banks, credit unions, monoline lenders, alternative lenders, and private lenders Customized mortgage strategies for first-time home buyers , investors , and those refinancing Transparent communication and education to empower your decisions Competitive rates and flexible terms negotiated on your behalf For instance, if you are purchasing a condo in a busy urban area, Tina Kha Mortgages can help you find lenders who offer low down payment options and favorable terms for condominium financing. If you are an investor, they can assist in structuring your mortgage to maximize cash flow and tax benefits. Actionable tips when working with a mortgage expert: Prepare your financial documents in advance (income proof, credit report, debts). Be clear about your short-term and long-term housing goals. Ask questions about all fees and potential penalties. Review multiple mortgage scenarios to understand the impact on monthly payments. Keep communication open for updates and advice during the process. Mortgage paperwork and financial calculations What is the Commission for a Mortgage Agent in Alberta? Understanding how mortgage agents are compensated can help you feel confident in the services you receive. In Alberta, mortgage agents typically earn their income from the lender once your mortgage closes. This is usually referred to as finder's fees. For traditional lenders, also known as A lenders, such as banks, credit unions, and monoline lenders, the finder's fees are paid by the lender and do not directly cost the borrower. For alternative lenders and private lenders, typically there would be a brokerage fee. Part of the brokerage fee would be paid to the mortgage agent. It is important to clarify any potential fees or charges upfront. This is reviewed prior to deciding to move forward or not with the application. Key points about mortgage agent commissions in Alberta: Finder's fees are paid by lenders, not borrowers for most mortgages. Lender fees and brokerage fees are discussed upfront prior to making a decision. There are no hidden fees for mortgage advice or application assistance. By knowing this, you can focus on the value and expertise the mortgage agent brings without worrying about extra costs. Mortgage agent discussing commission with client Tips for Choosing the Right Mortgage Expert Selecting the right mortgage professional is essential to unlocking the best mortgage solutions. Here are some practical tips to help you make an informed choice: Check credentials: Ensure the agent is licensed and registered with the appropriate regulatory body. Experience matters: Look for agents with a proven track record in your specific mortgage needs. Read reviews: Client testimonials and online reviews can provide insight into their service quality. Ask about lender access: A wider lender network means more options for you. Communication style: Choose someone who explains terms clearly and responds promptly. Transparency: Confirm how they are compensated and any potential fees. Interviewing multiple agents before deciding can help you find a professional who aligns with your expectations and financial goals. Maximizing Your Mortgage Benefits with Personalized Solutions Tailored mortgage solutions go beyond just finding a low interest rate. They involve structuring your mortgage to fit your lifestyle and future plans. For example: If you plan to pay off your mortgage early, look for options with prepayment privileges and no penalties. If you expect income fluctuations, consider a mortgage with flexible payment schedules. For those buying investment properties, explore interest-only payment options to improve cash flow. First-time buyers may benefit from government programs and incentives that a mortgage expert can help you access, such as First Home Savings Account (FHSA) and RSP Home Buyers Plan (HBP) . By customizing your mortgage, you can save money, reduce stress, and achieve your homeownership goals faster. Conclusion: The Importance of Expert Guidance Unlocking the right mortgage solution requires expert guidance, personalized strategies, and clear communication. Working with a trusted professional like those at Tina Kha Mortgages ensures you receive tailored advice and access to competitive products. Whether you are buying your first home, refinancing, or investing, expert mortgage help can simplify the process and secure your financial future. Take the first step today by consulting a mortgage expert who understands your unique needs and can guide you every step of the way. Let's connect today!
Knowledge Library
Getting a Mortgage
Understanding Mortgage Broker Fees in Canada
Reviewing mortgage documents with an Edmonton advisor. As a mortgage broker in Canada, I often receive a common question: "How do mortgage brokers get paid?" Like all professions, mortgage brokers need to earn a living. Fortunately, in most cases, you won’t have to pay any fees to work with a mortgage broker. How Does the Process Work? Let’s break down how the process typically unfolds: You either reach out to me or are referred because you need a mortgage. We connect, and I assess your budget, situation, and goals to find the best plan, lender, and product for you. I submit your application to your chosen lender and manage all communications. Once the mortgage closes, we get paid. How Do Mortgage Brokers Get Paid? Here’s a detailed breakdown of how mortgage brokers earn their income: Finder's Fees A finder's fee typically ranges from 0.20% to 1.10% of the mortgage amount. This percentage varies based on the lender, term, mortgage type, and other factors. Important Notes: The fee is calculated before: - Taxes - Brokerage splits (mortgage brokerages take a portion of the fee) - Team and mentor splits (some brokers work under a team or mentor and share the fee) - Credit checks (we pay for credit checks, which are necessary for the process) - Marketing costs - Website and blog expenses, among others. We only receive payment when a mortgage is fully closed. If a mortgage falls apart at the last minute, we do not get compensated for our efforts, which can sometimes take hours, weeks, or even months. Therefore, it’s crucial to trust your mortgage broker and provide all necessary information upfront. Who Pays the Finder's Fees? Traditional Lenders (banks, credit unions, and monoline lenders): - The bank or lender pays the mortgage brokerage, which then compensates me. Alternative and Private Lenders : - Borrowers may need to pay a lender fee and a brokerage fee, depending on the specifics of the file. - Alternative and private lenders may not always offer a finder’s fee, so a brokerage fee could be necessary. We will discuss any fees upfront to avoid surprises. What About Mortgage Renewals and Refinances? Renewals Renewing with Current Lender : - Generally, mortgage brokers do not receive payment when borrowers renew with their existing lenders. Renewing with a Different Lender : - We get paid as usual! Refinances We receive payment for refinances just like we do for new mortgages. Why Do Lenders Pay Mortgage Brokers? Mortgage brokers act as specialized representatives. We are not tied to any specific lender. Instead of hiring more bank advisors or mortgage specialists, lenders rely on mortgage brokers to bring in qualified clients who fit their guidelines. In return, they pay us for our work in preparing comprehensive mortgage files. Over the years, many borrowers have preferred working with mortgage brokers rather than directly with their banks . This preference stems from the access to a wider range of options and specialized guidance. You gain access to various mortgage options and expert advice without needing to learn everything from scratch. We are compensated for our expertise and time. Lenders receive well-prepared client mortgage files with minimal hassle, saving on marketing costs and administrative fees. Conclusion If you've made it this far, congratulations! You now have a clearer understanding of how mortgage brokers get paid. Our goal is to make your mortgage journey as seamless and stress-free as possible. We take the time to educate and guide you through the best options available. Additionally, if you’re a first-time buyer, understanding your mortgage options is just as important as knowing the fees, check out our guide to first-time home buyer programs in Edmonton . Have further questions? Let’s connect!
Getting a Mortgage
Bank OR Broker
There are a lot of misunderstandings about mortgage brokers. Some people think our job is just about rate shopping and hunt for the lowest mortgage rates, while others assume we charge steep fees for something they could easily do themselves. Let’s set the record straight and break down what we really do, without the corporate lingo and with a bit of personality. So, What Exactly Do We Do? Think of us like wedding planners, but for mortgages. If you were getting married, would you rather spend hours researching and visit every venue, caterer, and DJ on your own? Or would you rather have an expert who knows the best options, negotiates deals, and makes sure you don’t accidentally book a cheese fountain buffet for guests are lactose intolerant? That’s us!
Instead of working with just one lender, we have access to multiple banks, credit unions, monoline lenders (who only do mortgages), and alternative lenders.
What?!?!? Yes, that's right! Mortgage brokers have access to banks!, some people think we don't! We also have access to monoline lenders, which the general public can only access through working with a mortgage broker!
This means we can find the best mortgage for your unique situation, not just whatever one institution is offering. More Choices, Better Rates Banks can only have access to their own mortgage products, meaning you’re limited to their rates, their rules, and their approval process. Sometimes its tough to qualify only under one guideline...
A mortgage broker, on the other hand, has access to multiple lenders—including banks, credit unions, and alternative lenders, so you get more options and a competitive rate that fits your financial situation.
For example, if you’re purchasing your very first home, you may also want to explore first-time home buyer programs in Edmonton that can make the process more affordable. The Big Question: How Do Mortgage Brokers Get Paid? Unlike a bank, which prioritizes its bottom line, a mortgage broker works for you . Our job is to find the best mortgage solution based on your financial goals, not to push a specific product.
Plus, in most cases, there are no fees to work with a broker! In rare situations, such as complex cases or private lending, there may be lender and/or brokerage fees, this will be mentioned upfront before deciding to proceed. No hidden costs. When your mortgage is finalized, the lender pays the brokerage and the brokerage pays us! Expert Advice & Smooth Process Mortgage brokers don’t just find great rates, we guide you through the entire process, help you understand the product, and make sure you don’t accidentally jeopardize your approval (like financing or leasing a new car before closing!). We also handle the paperwork and troubleshoot any issues that arise. If you want more options, expert advice, and a stress-free mortgage process, working with a mortgage broker is a no-brainer. Thinking about buying or refinancing? Let’s chat! I'd love to assist you in finding the best solution that fits your financial plan!
Give us a call or book a time!
Mortgage Solutions
Understanding the Role of the Bank of Canada (BoC)
To put it simply, the Bank of Canada (BoC) creates and lends money to banks at what’s called the Overnight Lending Rate (or Key Interest Rate ). This is the rate banks pay to borrow money. One of the BoC’s primary responsibilities is managing inflation in Canada. It does this by adjusting the Overnight Lending Rate: If inflation is too high , the BoC raises rates to make borrowing more expensive. This slows down spending and curbs inflation. If inflation is too low , the BoC lowers rates to encourage borrowing. This stimulates economic growth. Currently, the BoC is focused on keeping inflation around 2% . However, rate changes often take months to impact inflation. Today’s inflation numbers reflect decisions made last spring. Likewise, today’s rate announcement will shape economic conditions next spring . This means the BoC must make forward-looking decisions—based on expert forecasts, but still with a fair amount of uncertainty. How This Affects Consumers The Overnight Lending Rate affects the prime rate . While influenced by BoC decisions, the prime rate is set individually by each lender. This means: Not all lenders have the same prime rate . They may apply different rates across products. A rate discount from one lender might seem better than another but could result in a higher overall rate if that lender's prime rate is higher. Prime Rate and Lending Products Many financial products are tied to the prime rate, including: Savings accounts (influencing the interest you earn) Lines of credit (e.g., prime + 2.00% for unsecured lines) Variable-rate mortgages (e.g., prime - 0.85%) Home Equity Lines of Credit (HELOCs) (e.g., prime + 0.50%) These products are often expressed as a premium or discount to the prime rate. As the prime rate changes, so do the interest rates on these products, affecting interest payments accordingly. Timing of Prime Rate Adjustments Since lenders set their own prime rates, adjustments after a BoC announcement can vary: Some lenders change rates immediately after an announcement. Others adjust rates within a few days or align changes with scheduled payment dates. Adjustable Payment Variable-Rate Mortgages Your monthly payment fluctuates with changes in the Prime Rate. If the BoC increases rates, your payment goes up. If it decreases rates, your payment goes down. Fixed Payment Variable-Rate Mortgages Your payment stays the same, but the portion going toward interest vs. principal shifts. If rates rise, more of your payment goes to interest, so you pay off less principal each month. If rates drop, more of your payment goes toward paying down the mortgage faster. So, depending on your mortgage type, a BoC rate announcement may or may not impact your monthly payment. The Big Misconception: Fixed Mortgage Rates and the Bank of Canada A major misconception I see every time the BoC announces a rate change is that fixed mortgage rates are affected . This is not true . When people see headlines like “Rates Are Dropping!” , they often assume this applies to fixed mortgage rates. So, if the BoC doesn’t set fixed mortgage rates, what does? Fixed Mortgage Rates and the Bond Market Fixed mortgage rates are based on the Canadian bond market, specifically bond yields. For example, 5-year fixed mortgage rates are influenced by 5-year Government of Canada bond yields . These yields fluctuate daily based on: Inflation numbers Employment data (Canada & U.S.) Investor confidence Global events (e.g., U.S. elections, geopolitical risks, economic outlooks) While the bond market and the BoC often react to the same economic conditions, fixed mortgage rates do not directly follow BoC rate changes . For example, if inflation data shows inflation dropping below target , bond yields might fall in anticipation of a BoC rate cut— before the BoC even makes an announcement. In contrast, when the BoC officially lowers rates, fixed mortgage rates may not change at all because the bond market already priced in that expectation. How to Choose Between Fixed and Variable Rates One of the most common questions I get is: “Should I go with a fixed or variable rate?” Unfortunately, no one has a crystal ball to predict future rates, but here’s my best advice: ✔ Make a decision based on today’s information, not speculation. ✔ Consider the long-term nature of a mortgage. You’ll likely go through 5–8 renewals over the life of your mortgage. Rates will fluctuate over time—sometimes you’ll “win,” and sometimes you won’t. ✔ Assess your personal risk tolerance. If you’d lose sleep over rate fluctuations, a fixed-rate mortgage might be better. If you’re comfortable with potential rate changes, a variable rate might save you money. ✔ Factor in potential penalties. Breaking a fixed-rate mortgage can come with significant costs, whereas variable-rate penalties tend to be lower. If you might need to refinance or sell early, this is crucial to consider. Since interest rate changes can influence your options, it may be worth exploring whether now is the right time to refinance your mortgage in Alberta . The Bottom Line When it comes to mortgage rates, not all loans are affected by the Bank of Canada’s decisions . If you’re in a fixed-rate mortgage , a BoC announcement won’t impact your existing payment. If you’re in a variable-rate mortgage , it depends on how your lender structures payments. As always, if you’re unsure about what’s best for you, speak with a mortgage broker (like me!) who can help you navigate the options based on your unique situation. Let’s Connect! If you want to know more about how mortgage rates affect your financial situation, please don't hesitate to reach out. Let’s connect today!
Getting a Mortgage
The RRSP Home Buyers' Plan (HBP)
Utilizing RRSP for Home Purchase: The Home Buyers' Plan (HBP) allows first time homebuyers to withdraw from their Registered Retirement Savings Plan (RRSP) tax-free. Considering combining the HBP with an FHSA for a larger down payment ? Let's explore if this strategy suits you. What is the HBP Withdrawal Limit? As of April 16 2024, withdrawal limit is $60,000. You can withdraw funds from multiple RRSPs, provided you own each account.
Spouses or common-law partners can collectively withdraw up to $120,000 ($60,000 each) for a home purchase if both meet the eligibility criteria.
HBP permits tax-free withdrawals from your RRSP for a qualifying home purchase. Leveraging this program allows you to maintain your investment fund for future needs while repurposing your RRSP investment into a real estate purchase. When do you have to repay HBP? Repayable through installments over 15 years timeframe As of April 16 2024, those who withdraw funds from their RRSP between Jan. 1, 2022, and Dec. 31, 2025, will have up to 5 years to restart payments (instead of the previous 2 years) Do you qualify for HBP? Being considered a first-time homebuyer , intending to live in the home as a primary residence, and having a written agreement to purchase or build a qualifying home are vital prerequisites.
Must be considered a first time home buyer Written purchase agreement for building a qualifying home or existing home Intended use of the property is primary residence Can HBP be combined with an FHSA ? Presents an opportunity to merge two savings products towards your primary home investment. Unlike the HBP, the FHSA doesn't require repayment, allowing tax-free withdrawals based on eligibility conditions.
Exploring the HBP can be a strategic financial move, offering dual benefits as a retirement and real estate investment. While the repayment period affects interest accumulation, it might align with your overall financial strategy, aiding your initial real estate purchase. Is the RRSP Home Buyers' Plan worth it? Taking advantage of the home buyers' plan is a great way to boost your down payment without having to pay income taxes for the withdrawal (if repaid on time).
With a repayment period of 15 years, this is plenty of time to pay it back. Having access to RRSP funds helps you afford your first home purchase.
Since RRSP withdrawals under the Home Buyers’ Plan can affect how much you borrow, it’s also important to understand how mortgage interest rates work and how they impact your overall affordability.
Ready to explore how the Home Buyers’ Plan can boost your down payment? Contact me today and let’s find the mortgage solution that fits your financial goals.
Getting a Mortgage
Understanding How Your Credit Score Affects Your Mortgage Outcomes
Your credit score is vital in determining your mortgage eligibility and rates. It significantly influences the overall approval process. Borrowers with good or excellent credit scores typically enjoy lower interest rates, improved terms, and a smoother application experience. However, even if your credit isn't perfect, securing a mortgage is still possible. Let's explore how credit scores impact mortgage rates, and the options available for various credit situations. The Influence of Credit Score on Mortgage Rates Lenders evaluate risk when issuing mortgages. Your credit score is one of the leading factors they consider. A higher credit score signals responsible management of financial obligations, making you a lower-risk borrower. This can lead to a wider range of lender options, lower rates, and more attractive terms for those with excellent credit histories. Imagine this: just as you wouldn’t lend money to someone you don't know without their financial background, lenders want assurance that you will make mortgage payments on time. A high credit score, paired with a good repayment history, provides that reassurance. Conversely, a lower score may lead to higher interest rates or additional lending conditions. Key Factors Lenders Review in Mortgage Applications Beyond credit scores, lenders consider other vital factors when assessing mortgage applications: Debt-to-Income Ratio: This metric compares your total debt payments to your monthly income. A lower ratio indicates that you can comfortably manage additional mortgage payments. Down Payment: A more substantial down payment lessens the amount needed to borrow and lowers the lender’s risk. In Canada, the down payment size also influences whether mortgage default insurance (like CMHC) is necessary. Employment History & Income Stability: Lenders seek a stable employment record and dependable income. A consistent job history assures them that you have the financial stability to make regular mortgage payments. The Importance of Good Credit Your credit score plays a significant role in the mortgage terms and rates offered to you. A strong credit score can be the deciding factor between mortgage approval and rejection. It also affects whether you qualify as an "A borrower" (preferred rates from traditional lenders) or a "B borrower" (alternative lenders with higher rates). A strong credit score can also open the door to better mortgage opportunities over time, which is why many homeowners explore whether now is the right time to refinance your mortgage in Alberta . What Constitutes a Good Credit Score in Canada? According to Equifax , Canadian credit scores are categorized as follows: 660 – 724: Good 725 – 759: Very Good 760 and above: Excellent Minimum Credit Score for Mortgage Approval While some lenders approve mortgages for borrowers with credit scores as low as 600, a score of 680 or higher is typically necessary to access the most favorable interest rates and mortgage products. Checking Your Credit Score: A How-To Guide To check your credit score, obtain your credit report from Equifax or TransUnion . This process won't impact your credit score and offers valuable insights about your credit health. When reviewing your report, watch for errors and correct them promptly if necessary. Steps to Improve Your Credit Score If your credit score needs improvement, don't fret. You can take these simple steps to enhance it. Ideally, begin these steps several months before applying for a mortgage: ✔ Make all payments on time: Even a single missed payment can adversely affect your score. ✔ Maintain low credit utilization: Aim to use no more than 30% of your total available credit. Avoid going over limit and high utilization rates. ✔ Regularly check your credit report: Report any inaccuracies immediately for correction. ✔ Limit applications for new credit: Each application can impact your score. ✔ Keep old credit accounts open: A longer credit history generally strengthens your score. Securing a Mortgage with Bad Credit Yes, you can still secure a mortgage with a less-than-perfect credit score! While a lower score may reduce available lender options, it doesn't eliminate the possibility of homeownership. Here are some strategies to improve your chances of approval: Provide a larger down payment: This action reduces the lender’s risk. Have a co-signer or guarantor: A stable co-signer can bolster your application. Explore alternative lenders: Private or other non-traditional lenders may offer viable solutions. Navigating the Mortgage Process While a robust credit score can help secure the best mortgage rates, there are still options available for those with less-than-perfect credit. It's wise to connect with a professional early and devise a strategy tailored to your needs. As an experienced mortgage broker, I can guide you through the mortgage process and find a solution that fits your unique financial situation. Ready to explore your mortgage options? Contact me today, and let’s find the best path to homeownership for you!
First Time Home Buyers
First Home Savings Account (FHSA)
Increase down payment power! Combine together with RRSP Home Buyers Plan (HBP) or use it alone.
Are you a first time home buyer in Canada aiming to secure your down payment while enjoying tax benefits?
Understanding its contribution limits, eligibility criteria, and strategic advantages can help pave your way to home ownership. Maximizing FHSA Contributions for a Tax Free Down Payment FHSA allows eligible individuals to contribute a tax-deductible amount of up to $8,000 annually, accumulating to a maximum contribution limit of $40,000 within five years, assuming maximum annual contributions.
Important note, that annual unused contribution room is capped at $8,000, restricting the maximum yearly contribution to $16,000 (current year's limit + previous year's carry-forward). Tax Free Savings and Withdrawals Saving within an FHSA offers tax advantages, enabling growth on contributions tax-free. Additionally, withdrawals made for a qualified home purchase remain tax-exempt, including accrued interest from FHSA investments. FHSA Eligibility and Account Details To qualify for an FHSA, certain criteria must be met: Being at least 18 years old (or 19 in some provinces) Holding Canadian residency Meeting the Canadian government's definition of a 'first-time homebuyer'
As a first-time homebuyer, you must not have owned or jointly owned a qualifying home in the current calendar year or the preceding 4 calendar years. Utilizing FHSA Funds for Home Purchase FHSA withdrawals for a home purchase can be used towards various expenses beyond the down payment, such as closing costs, legal fees, and moving expenses. What Happens If You Don't Buy a Home? If funds remain after 15 years from the opening date (or upon reaching 71 years of age), transferring the amount to an RRSP or RRIF maintains the tax-deferred status. However, not using the funds for a home purchase forfeits the tax-free withdrawal benefit. Combining FHSA and Other Homebuying Options Consider combining FHSA benefits with other programs, such as the Home Buyers' Plan (HBP) , allowing withdrawals from RRSPs for a home purchase, maximizing your down payment potential.
Funds withdrawn from RRSP through the home buyer plan must be repaid within 15 years to keep the tax deferral benefits.
Once you’ve built savings in your FHSA and are ready to buy, it may also be worth exploring whether now is the right time to refinance your mortgage in Alberta to take advantage of changing rates.
Ready to make the most of the First Home Savings Account for your first home? Contact me today and let’s build the best strategy for your down payment.
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