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Joe Gaglione and Matthew Gaglione (780) 488-4000

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Mortgage Insurance Fee Increases

March 3rd, 2014 by gaglionerealestate

What started as an announcement of rate increases by the Canadian Mortgage and Housing Corporation (CMHC) will surely lead to an industry wide change in mortgage insurance costs.  While mortgage insurance is available to a wide variety of lending situations, it is mandatory for consumers who wish to purchase a home with a down payment which is less than 20% of the purchase price.  Not all of the rate increases are equal, and while it is being reported that the average increase will be around 15%, there are different percentages depending on how much of a down payment you are willing to do.

Below is a breakdown of the breakdown of the old and new rates.  The fee is based on a percentage of the mortgage amount and is most often rolled into the mortgage:

Down Payment %     Old Rate         New Rate       Increase          % Increase    

15%                             1.75%              1.80%              0.05%              2.86%

10%                             2.00%              2.40%              0.40%              20.00%

5%                               2.75%              3.15%              0.40%              14.55%

On a $300,000 Purchase, here would be the changes in the premiums:

 

Down Payment %     DP Amount    Old Fee           New Fee         Difference

15%                             $45,000           $4,462.50        $4,590.00        $127.50

10%                             $30,000           $5,400.00        $6,480.00        $1,080.00

5%                               $15,000           $7,837.50        $8,977.50        $1,140.00

 

On a $300,000 Purchase, at 3.50% interest on a 25 year mortgage, this would be the impact on the approximate monthly payments:

 

Down Payment %     Old PMT        New PMT      Extra/mth

15%                             $1,298.93        $1,299.57        $0.64

10%                             $1,378.72        $1,384.12        $5.41

5%                               $1,466.01        $1,471.72        $5.71

While no one wants to pay more, these numbers show that there is no need to hasten a purchase or jump into a situation due to the fear of increasing costs.  As with anything in Real Estate, doing your proper due diligence and making a purchase when you are on sound financial footing should be a far greater determining factor than the recent changes in the mortgage insurance market.  Please do not hesitate to contact me if you have any questions regarding this or any other aspect of real estate and be sure that you have a good mortgage broker or specialist who is willing to take the time to explain, in detail, all of your mortgage options.

To see a PDF of some additional examples, click here.  For additional tips, links, and downloads, please visit http://www.gaglionerealestate.com/buyers_guide.php and scroll down to the Document Downloads section.

 

 

MATTHEW GAGLIONE
RE/MAX REAL ESTATE
10805 – 120 ST
EDMONTON AB T5H 3P9
OFFICE: (780) 488 – 4000
CELL: (780) 909 – 3171
FAX: (780) 426 – 5700
TOLL FREE: 1 (800) 275 – 8191
EMAIL: MGAGLIONE@REMAX.NET
WEBSITE: WWW.GAGLIONEREALESTATE.COM

What Happens on Possession Day?

January 8th, 2014 by gaglionerealestate

In a Real Estate transaction in Alberta, the closing and possession days are typically the same day.  While there are exceptions for tenancy-at-will scenarios and other possibilities, most commonly on Possession Day (Completion Day), quite simply, money for the property is transferred to the sellers and keys are released to the buyers.  While this sounds straight forward, there are a lot of parties involved in this process and by understanding how it unfolds will help ease the stress of this important day.

Rule #1: Buyers, Do Not Book Your Moving Van To Arrive For Noon on Possession Day!!!

On our standard Purchase Agreements, transfer of funds and ownership of the property is supposed to occur at 12:00pm on the Possession Day.  In reality, if all participants to the process are prepared and things happen smoothly, this will more likely happen closer to 2:00pm on a typical day.

If all the paperwork has been signed on time with the bank and the lawyers prior to the possession day, this is the sequence of events that is typically needed to unfold here in Alberta:

  1. Bank sends mortgage funds to the Buyer’s lawyer;
  2. The Buyer’s lawyer couriers the sale proceeds to the Seller’s lawyer;
  3. The Seller’s lawyer confirms receipt of the funds with the Seller’s Realtor;
  4. The Seller’s Realtor makes contact with the Buyer’s Realtor and arranges to release keys;
  5. The Buyer’s Realtor picks up keys at the Seller’s real estate brokerage; and
  6. The Buyer’s Realtor contacts their clients and meets them to hand over the keys.

 

Delays in any of the above steps can cause a delay on closing resulting in a delayed key release.  Late mortgage funds, busy couriers or law offices, and distances between law firms, real estate brokerages, and the Property are all factors in the timing of the key release.

What can you do to help ensure a smooth possession day?

  1. Try to avoid Friday, Mid Month, and End of Month Closing Dates.  Nothing is worse than a Friday possession that gets delayed to the following Monday causing an entire weekend worth of moving to be wasted.
  2. Ensure plenty of communication is occurring between all parties to the transaction.  A Lawyer that is reminded the day of possession that they are to be transferring funds will not contribute to a speedy transaction. This especially can occur when there is an amendment changing the date of possession and either the mortgage company or the lawyer are not made aware of it or do not adjust their dates.
  3. If you have any questions at all about the process, DO NOT HESITATE to contact us and we’ll do our best to answer any and all of your concern

 

To Download this as PDF, click here.  For additional tips, links, and downloads, pleave visit http://www.gaglionerealestate.com/buyers_guide.php and scroll down to the Document Downloads section.

MATTHEW GAGLIONE
RE/MAX REAL ESTATE
10805 – 120 ST
EDMONTON AB T5H 3P9
OFFICE: (780) 488 – 4000
CELL: (780) 909 – 3171
FAX: (780) 426 – 5700
TOLL FREE: 1 (800) 275 – 8191
EMAIL: MGAGLIONE@REMAX.NET
WEBSITE: WWW.GAGLIONEREALESTATE.COM

What Your Real Estate Lawyer Appointment Entails

December 16th, 2013 by gaglionerealestate

When conducting a real estate transaction in Alberta, you will at one point, typically after all your conditions have been removed and approximately a week before possession, meet with your lawyer to sign your transfer paperwork.  Below are some of the items you will be required to bring with you to make this a smooth process.  For a downloadable summary of this blog, please download my Lawyer Appointment PDF.

Purchase:

When you set your appointment to sign the documents with your lawyer, there will be certain items that you will need to bring with you. While the Law Firm should be outlining this with you beforehand, here is a list to get started:
1. Piece of Government Issued Photo Identification (Driver’s Licence, Passport, etc)
2. 2nd Piece of Identification (Alternate photo ID, Credit Card, SIN Card, Birth Certificate)
3. Void Cheque: Some banks require this as part of the mortgage automated debit paperwork
4. Proof of Insurance: Most mortgages require that the home be insured as a condition to having a mortgage placed on it. Condominiums typically have the Corporation insure the building but you are still responsible for insuring your unit and contents. This is often called Condominium Property Insurance which is similar to Tenant’s Insurance in that it insures your contents, but you want to make sure there is an additional Liability Rider in there as well that may protect you from things like leaving the tub running and damaging neighbouring units. Be sure your insurance company or broker explains ALL the coverages in DETAIL with you and that you ask a lot of questions to see what cases are covered and what events are not looked after by your policy.
5. Cash to Close: This is the amount that your lawyer will have calculated which figures out how much remaining that you owe for the transaction. It takes the Purchase Price, subtracts what you have paid in deposits and the mortgage to come up with the Balance Owing and then adds the Legal Fees and Disbursements as well as any Adjustments (Tax/Condo Fee)

Example: Purchase Price: $300,000.00
Mortgage Amount: $240,000.00
Deposits: $20,000.00
Leaves a Balance Owing of $40,000 which is the rest of your down payment. In this scenario, there is also a $1,500 Tax Adjustment that needs to paid to the seller and a $200 Condo Fee Adjustment that also needs to be paid to the seller. Legal Fees and Disbursements are $2,000. That would mean your Cash to Close amount that you would need to bring via certified cheque or bank draft would be $43,700.00.
Sale:

When selling your home, the list is similar with the exception of needing proof of insurance. The Cash to Close is also calculated but if there is enough equity in the home, will result in a cheque being written to you. It takes the Sales Proceeds (Purchase Price), subtracts the mortgage payout amount, your real estate and legal fees, adds or subtracts any applicable tax or condo fee adjustments, leaving an amount to be paid out.

For additional tips, links, and downloads, pleave visit http://www.gaglionerealestate.com/buyers_guide.php and scroll down to the Document Downloads section.

MATTHEW GAGLIONE
RE/MAX REAL ESTATE
10805 – 120 ST
EDMONTON AB T5H 3P9
OFFICE: (780) 488 – 4000
CELL: (780) 909 – 3171
FAX: (780) 426 – 5700
TOLL FREE: 1 (800) 275 – 8191
EMAIL: MGAGLIONE@REMAX.NET
WEBSITE: WWW.GAGLIONEREALESTATE.COM

Ending of Canada Post’s Door to Door Mail Delivery

December 11th, 2013 by gaglionerealestate

According to releases from Canada Post, there is now a timeline in place for the complete termination of all remaining door to door mail delivery within the next five years.  This will signal in the ubiquitous adoption of their Community Mailboxes not only in newer communities, but throughout all centres.  This decision impacts approximately one third of households who still receive mail delivery straight to their homes.  While common in younger neighbourhoods, those who have not had experience using them may encounter unanticipated logistical challenges with regards to obtaining keys after a residential purchase in one of these evolving areas.  For more information, you can go to view our Canada Post Mailbox Rekeying instructions.

 

For some background on the issues and impacts of this decision, here are a few news articles:

http://news.nationalpost.com/2013/12/11/canada-post-to-stop-door-to-door-delivery-convert-to-community-mailbox-delivery/

http://www.cbc.ca/news/canada/ottawa/canada-post-to-phase-out-urban-home-mail-delivery-1.2459618

 

For additional tips, links, and downloads, pleave visit http://www.gaglionerealestate.com/buyers_guide.php and scroll down to the Document Downloads section.

Pigeon Lake Lot

December 2nd, 2013 by gaglionerealestate

Silverwoods: Private, Peaceful, and Affordable Treed lots in a Paved Subdivision located within a short walk to the Village of Pigeon Lake.  Whether you are looking for Country Residential or Purely Recreational, these densely forested plots offer power, gas, and roughed in sewer connections for the County’s planned future waste management plan right at their property line.  Steps away from Shopping, Restaurants, and Pigeon Lake, here is your opportunity to experience the perfect balance of quiet seclusion within a modern community.  Various building options are available, GST may be applicable, and taxes are to be assessed.  Come see for yourself what truly sets Silverwoods above the rest.

Oliver Beauty

November 16th, 2013 by gaglionerealestate

Fantastic Top Floor Two Bedroom, Two Bathroom Condo with TWO Underground Titled Parking Stalls!  This Bright and Open 828 sq/ft unit features Air Conditioning, In Floor Heating, Gas Fireplace, Natural Gas BBQ Outlet (Included in the Condo Fees), and South Facing Balcony with a Spiral Staircase which leads to a Private, Roof Top Patio!  This Home also Boasts an Enormous 18′ Vaulted Living Room Ceiling, a Large Walk-Through Closet to the Master Bedroom Ensuite, as well as In-Suite Laundry.  Located in the Heart of Oliver, this Pet, Smoke and Carpet Free Condo Includes all Appliances, plus is Walking Distance to Shopping, Restaurants, Transit/LRT, and Grant MacEwan University.  All Situated in a Steel Building, the unit is a Definite Must See!

 

Fabulous Find

September 19th, 2013 by gaglionerealestate

Renovated three bedroom, one and a half bath townhouse in Pleasantview! This clean and well-kept property has newer flooring, kitchen cabinets and appliances, paint, upgraded four and two piece baths, vinyl windows, plus a finished rec room in the basement.  Conveniently located near public transit, this great south side location is just minutes to Southgate Mall and the LRT.  With a spacious fenced rear yard backing on a lane, this turnkey, pet and smoke free home is definitely a must see!

Twin Brooks Adult Condo

August 13th, 2013 by gaglionerealestate

Beautiful bi-level duplex with double attached garage in Twin Brooks! This 2+2 bedroom, 2.5 bath home features a large fully finished basement, air conditioning, hardwood floors, corner gas fireplace, vaulted ceilings, and comes with all appliances.  Upstairs, the large master bedroom boasts a walk-in closet and attached four piece en-suite with separate tub and walk-in shower.  The bright kitchen has plenty of storage along with additional built-in cabinetry in the dinette.  Out back you have a nice deck with privacy screening and a natural gas BBQ hookup.  With lots of storage and big bright windows in the basement, this home is definitely a must see!

Your Dream Home only minutes from Sherwood Park

August 13th, 2013 by gaglionerealestate

Fantastic Custom Built home in Ranchlands! Located right next to Sherwood Park and situated on a 1.95 acre lot serviced with municipal water and sewer, this 2700 sq/ft walkout bungalow features a total of five bedrooms, den, four and a half baths, four car attached garage, granite, hardwood, plus in-floor heating downstairs in the fully finished basement.  Above the garage is a fully functional in-law suite with a living room, bedroom and ensuite bath.  Beautifully landscaped, raised deck and massive patio, all with a bright and open sun room that overlooks the private back yard, this home truly is a must see property.

Matt Berry Deal

July 12th, 2013 by gaglionerealestate

Best priced home in Matt Berry.  Built in 2005, this 1256 sq ft 3 bedroom, 2 full bath bilevel has been immaculately maintained. Master bedroom boasts walk in closet and 4 piece ensuite. Features a double attached garage, landscaping and fenced yard with concrete patio and raised deck. Comes with all appliances. Flexible possession. This well-built, affordable home located on a non-thru road truly must be seen.


Joe Gaglione and Matthew Gaglione, RE/MAX Real Estate Central
#100, 10510 - 121st Street, Edmonton, Alberta, T5N 1L4
Tel: (780) 488-4000 Fax: (780) 426-5700
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