Your Home Buying A-Team

General Greg Weaver 20 May

There are four major components to any successful home buying A-Team: your mortgage professional, realtor, home inspector, and lawyer. Each of these individuals is important to various aspects of the home buying process.


While many people think a real estate agent is the most important person when it comes to buying a new home, your mortgage professional comes first. This is especially true for anyone looking to pre-qualify for a mortgage before searching for their forever home! Not only does pre-qualification help you establish your budget, but it can also lock in a low rate for you for up to 120 days while you search for your perfect home.

When it comes to choosing a mortgage professional, there has been a recent upward trend in using a mortgage professional to arrange mortgage financing. Many banks are cutting back on staff and centralizing operations to save money. While this doesn’t affect the day-to-day finances, it can create a headache when it comes time to discussing and finalizing a mortgage agreement.

You may not know much about mortgage professionals, but they are steadily gaining popularity due to providing top-notch service and unbiased advice. Also, unlike individual banking representatives who often move from one branch to another, mortgage specialists work to form lifelong relationships with their clients. The dedication of mortgage professionals to their clients and their unique position in the mortgage market often results in finding lower rates for their customers and providing the best possible plan to ensure their clients financial success.

One of the reasons mortgage professionals are able to find their clients such amazing deals when it comes to mortgage interest rates is that they operate independently of any single financial institution. Banks are only able to access their rates – no one else’s. On the other hand, Mortgage brokers have access to MORE rates and lenders than the bank! In fact, a typical broker has access to over 90 lenders! This means they are able to shop around, on your behalf, to find the most affordable option thereby saving you tons of time and money in the long run.

So, not only can a mortgage professional shop around for you AND save you money on your interest rate, their services are almost always free to the homebuyer! This is because mortgage professionals get paid by the lenders directly! What else can you ask for? Better rates, personalized service, flexibility and products at no cost to you. Some people may argue that the fee is built into the payment, but this is not so. It costs the banks approximately 40 per cent less to generate a mortgage through an agent than a branch, as there is no overhead to pay if the bank doesn’t get a client’s business. Instead, the mortgage broker bears the entire cost of day-to-day business activity and the bank simply pays for the privilege of gaining you as a client.

Your mortgage professional has also developed relationships with numerous realtors and is also able to recommend a qualified realtor to help you through the home-buying process.


Mortgage professionals have access to a variety of lenders to ensure they find you the best rate, but who exactly are these lenders?


A bank is a financial institution that accepts deposits, lends money and transfers funds. Banks are listed as public, licensed corporations and have declared earnings that are paid to stockholders and are regulated by the federal government’s Office of the Superintendent of Financial Institutions. Most Canadians know the five big banks: BMO, Scotiabank, CIBC, RBC and TD Canada Trust. Big banks are great options for variable rate mortgages as they have smaller penalties if you have to break the mortgage for any reason. When it comes to fixed-rate mortgages however, the penalty can be quite large when compared to different types of lenders.


Credit unions also deposit, lend and transfer funds much like a bank, but beyond that there are some major differences between the two.

Credit Unions have an elected Board of Directors that consists of elected members from their community. They are local and community-based organizations and, unlike the banks, are provincially regulated versus federally.

One major advantage of getting your mortgage through a credit union versus a bank is that the credit unions are not subject to the recent “stress test” changes for uninsured mortgages (excluding Quebec). This is due to the fact that credit unions are provincially regulated and the stress test is a federal regulation. Of course, your ability to pay down your debt will still be tested, but not at a higher rate.

Another advantage of using a credit union is that the calculation for penalties when it comes to breaking a mortgage agreement is typically friendlier to the borrower, and, if there are credit issues, they tend to be more understanding than the big banks.


A monoline is a type of financial service that specialises in consumer credit, home mortgages or a sole class of insurance. While these businesses typically do not have branches and are mainly accessed through a mortgage professional, there are some advantages to the consumer when it comes to using a monoline lender.

The first is that monolines usually offer better discounted rates and how they calculate the penalties can be friendly to the client. The biggest strike against them is they’re just not as well-known or trusted as a bank. It should be noted, however, the major investors in monolines are the big banks, so there’s nothing really to fear.


If for any reason you are not able to get approved for a mortgage through traditional lender channels, there is another option – Plan B. In fact, these secondary lenders make up almost 10 percent of mortgage transaction volume! That said, there are a few things to know.

The first is that alternative lenders often provide higher interest rates than A-lenders as it is a more risky investment. In addition, most B-lenders will charge a one-time fee of 1% of the loan amount. However, if you have no other options this is still a viable way to get approved!

Mortgage professionals have access to a fair number of alternative mortgage lenders (B-lenders) who offer excellent solutions above and beyond the traditional branch-based options. When mortgages are arranged through an agent with an A-lender, the charge is covered by the lender directly. However, it is important to note that there may be a fee when sourcing an alternative mortgage lender.


Before a mortgage can be approved, there are a few things that your lender or mortgage professional needs to know.


The first thing that your mortgage professional or lender will ask for is details surrounding your income and job stability.

Your income will determine how much money you can borrow. In most cases, 35 percent of your gross income for salaried, non-self-employed or commissioned people is used to determine how much you can borrow to cover the cost of the mortgage payments, taxes and any applicable maintenance. All other debts (car loans, credit cards and lines of credit, etc) must not exceed an additional seven per cent of your gross income.

It is also important to note that sticking with your employer while going through the home buying process is crucial. Any changes to your employment or income status can stop or greatly delay the mortgage approval process.


Your credit history and credit score are used to show that you pay your bills on time. A great credit score includes keeping a balance on credit cards at any given time that is below 30 percent of the total card limit – and paying it off monthly. A credit rating above 680 puts you in a good position to get financing while a score below will result in higher interest rates or a more challenging mortgage acquisition.

If you’re new to the world of credit, consider the 2-2-2 rule. Lenders want to see two forms of resolving credit (ie: credit cards) with limits no less than $2,000 and a clean payment history for two years.


Once you have put in an offer on your dream home and it has been accepted, there are a few things you will need to finalize your mortgage agreement.


Supplying your income details to the lender for pre-approval helps to determine your budget and how much you can borrow. Once you are ready to finalize the mortgage, you will need to confirm this information. For salaried individuals, this can be done by submitting a letter of employment, your most recent pay stub, your last two years income, and Notices of Assessment from Revenue Canada.


The lender will require that you prove the source of your down payment. You’ll have to send in bank statements, RRSP statements, stocks, etc that show the previous three-month history of your accounts. If there are any large lump-sum deposits, you’re likely to be asked to show where the deposit originated. You’ll also be asked to demonstrate that you have access to 1.5 percent of the purchase, in addition to the down payment, to ensure you are able to cover closing costs such as: legal fees, Title Insurance, property tax prepayment, and Property Transfer Tax.


This is a copy of the accepted offer of the home you intend to purchase and a copy of the MLS listing sheet. The purchase contract will also be accompanied by a Property Disclosure Statement and a Strata Form B Disclosure if applicable.


As you may already know, a real estate agent is one of the most vital members of your homebuying A-Team! In fact, in today’s competitive real estate market, it can be very difficult to acquire property WITHOUT the help of a realtor.

One of the reasons realtors are integral to the home buying process is that they can provide access to properties that never even make it to the MLS website. Realtors also gain access to information about homes that may come onto the market before a listing is even signed.

Most importantly though, a realtor understands the ins and outs of the home buying process and can tell you how to be successful in your endeavors to purchase a home by guiding you through the process from the first viewing to having your bid accepted.


While a competitive market can make a home inspection more difficult, it is a highly recommended part of the home buying process! Having a home inspection done is important to ensure that there are no hidden surprises which may crop up after the sale is finalized. A home inspector can determine what’s behind the walls and look for any signs of mold, leaks or old wiring that could cost you down the road. A good home inspector can often be recommended by your mortgage professional or realtor who may know of many reliable options for getting your inspection done.

While most people assume home inspections are just for the buyer, that’s not always the case. If you’re selling a home, you might want to consider a home inspection too! Any issues that come up during an inspection by a potential buyer can lead to delays and kill a deal altogether but scheduling a certified inspection prior to putting the home on the market could save you time and ensure a smooth process once you do start getting offers!


Once you are ready to finalize financing and purchase a home, you will need a lawyer or notary to draw up the documents and register them on file for you. Since the visit to your legal professional is the last step in the entire process, it’s extremely important that this be handled with care. Mortgage professionals can recommend a qualified lawyer or notary who specializes in real estate transactions that can help streamline this process.

If you are looking to get help with your mortgage, contact one of Dominion Lending Centres Mortgage Professionals today for expert advice you can count on!


Published by DLC Marketing Team

Process in the Paperwork

General Greg Weaver 9 May

Documents Required to Qualify for a Mortgage

Mortgages can sometimes feel like endless stacks of paperwork, but being prepared in advance can save you time and stress! Getting your mortgage pre-approved is part of this prep-process, and will make things easy in the long run.

In order to get pre-approved, the lender must have taken you on as a client and reviewed all your documents before you begin house-hunting. It is important to ensure you have your pre-approval certificate before moving ahead and your pre-approval agreement in writing. This should include the pre-approved mortgage amount, the mortgage term, interest rate, payment information, and the expiry for the pre-approval. Typically, they are valid for up to 120 days.

To prepare for the mortgage pre-approval process, there are a few must-have documents that you will need to organize and have available prior to submission.

  1. Letter of Employment: One of the key aspects for financing approval is employment stability. Lenders want to see a letter from your employer (on a company letterhead) that details when you started working at this company, how much you make per hour or your annual salary, your guaranteed hours per week, and any probation if you are new. This can be done by your direct manager or the company HR department – they will be used to this type of request.
    1. Previous Two Pay Stubs: In addition to the employment letter, you must also have your previous two pay stubs. These must indicate the company name, your name and all tax deductions.
  2. Supporting Documents for Additional Income: If you have any other income, such as child support, long-term disability, EI, part-time income, etc., the lender will want to see any and all supporting documentation.
    1. NOTE: If you are divorced or separated and paying child support, it is important to also bring your finalized separation or divorce agreement. In some cases, they may request a statutory declaration from your lawyer.
  3. Notice of Assessment from Canada Revenue Agency: Lenders will also want to see your tax assessment for the previous year. If you do not have a copy, you can request one from the CA by mail (4-6 weeks) or you can login to your online CRA account to access it.
    1. Your Previous Years T4: Along with your tax filing and assessment notice, lenders will also want to see your previous years T4 slip to confirm income.
  4. 3-Month (90 day) Bank Account History: Lastly, it is important for lenders to see 90 days history of bank statements for any funds that you are using towards the down payment. As saving up for a down payment takes time, there should be no issues providing these documents. If you received the money from the sale of a house or car, or as a gift from your family, you will need proof of that in the form of sales documents or a letter.

The above documents are required for any potential buyer who is a typical, full-time employee. But what if you only work part-time? Or maybe you are self-employed? Here is what you will need:

part-time employee

You will still require all of the above documents (letter of employment, previous pay stubs, supporting documents for any additional income and 90 days of bank history).

However, the difference between a full-time employee and a part-time employee, is that if you only work part-time, you will need to supply THREE years worth of Notice of Assessments, versus just one. You will also need to have been working for at least two years in the same job to use part-time income.

If you have both a full-time and a part-time job, you can use that income too, assuming it has been at least two years.


If you are self-employed, the requirements for documents to lenders are slightly different. You will need to provide them:

  1. 3-Month (90 day) Bank Account History: Lenders need to see 90 days history of bank statements for any funds that you are using towards the down payment.
  1. T1 Generals: Also known as the Income Tax and Benefit Return
  2. Statement of Business Activities: This is used to illustrate the business income versus expenses and should include financial statements for your business.
  3. Notice of Assessment from Canada Revenue Agency: Similarly to part-time income, if you are self-employed you will also need to provide the previous three years of assessments.
  4. If Incorporated: You will need to supply your incorporation license and articles of incorporation.

When it comes to mortgages, preparation is key. Having pre-approval in hand can prevent any delays or issues with subject-to-financing clauses in the mortgage agreement. While you can walk into a bank, fill in an application and get a rate for a potential mortgage, this is just a ‘rate hold’ meaning it is a quote on the rate so you can qualify for the same rate later. This is not a pre-approval and does not guarantee financing.

To save yourself the headache down the line, contact Greg Weaver today to start the pre-approval process! Plus, our services are free to you. Why wait? Get fully pre-approved today to make closing the deal that much faster when you do find that perfect home.



Published by DLC Marketing Team

Benefits of Home Ownership

General Greg Weaver 6 May

So, you have decided to utilize your buying power in the Canadian retail market and are looking to purchase a home – congratulations! This is a great step towards ensuring your future.

As a potential homeowner, there are some amazing benefits that we think you should be aware of right out of the gate:

  1. Homeownership is the single largest source of savings for Canadian households.
  2. Your payments build equity (as opposed to renting, where your money goes to the building owner).
  3. Equity you build in your home can be used as security for other loans.
  4. The return on investment is substantial – in fact, the average price of a house for sale on the Canadian real estate market has increased every year since 1998.
  5. While other investments can prove volatile, investing in real estate is a solid use of your hard earned money.

Buying a home is not just about equity and investments, but it is about the future. While it is important to know what a mortgage is and how much you qualify for (and can afford), ensuring your new home is so much more than numbers. In these changing times with the cost of living constantly increasing, having home equity to fall back on can have a huge impact on your quality of life. Not only that but owning your own home gives you a sense of pride, a feeling of security, and the freedom to design the perfect living space for yourself – without having to ask permission from strata or a landlord! Moving into your first apartment or moving on up to your first house is an incredible step in the journey of life!

Now, as excited as you are to get started, you probably have some questions! Let us take you through some of the most important things to know when it comes to homeownership to ensure your experience is as smooth as possible – and provides the best possible outcome for you!


It is amazing how many people really don’t know what a mortgage is. Maybe you weren’t sure you would be in a position to have one or maybe you just never asked! Never fear – we have the answers.

To keep it simple, a mortgage is a loan that is specific to properties and homes. This type of loan uses the home or land you purchase as security in the event the loan cannot be paid. Mortgages are registered as legal documents and can be obtained through a variety of sources (or lenders) including banks, credit unions, and alternative lenders, or through the use of a mortgage broker!


Principle The principal is the amount of the loan that is actually borrowed.
Interest Rates As with any loans (credit cards, lines of credit, etc) interest will be incurred. This is the amount that the lender charges for the privilege of funds borrowed. The amount of your interest payment will depend on the interest rates, which vary depending on terms and conditions of the mortgage and the borrower’s credit history.
Mortgage Payments These can occur monthly, semi-monthly (twice a month), bi-weekly (every other week), accelerated bi-weekly or weekly and are made to the lender. These payments encompass both payments to the principal amount borrowed, as well as interest charges.
Amortization Period This is the number of years it will take to repay the entire mortgage in full and is determined when you are approved. A longer amortization period will result in lower payments but more interest overall as it will take longer to pay off. The typical range is 15 to 30 years.
Term Term is the length of time that a mortgage agreement exists between you and the lender. Rates and payments vary with the length of the term. The most common term is a 5-year, but they can be anywhere from 1 to 10 years. Generally a longer term will come at a higher rate due to the added security. A “Fixed Mortgage” means you are locked in at the interest rate agreed for a longer length of time.A “Variable Mortgage” features an interest rate that is adjusted periodically to reflect market conditions.
Maturity Date The maturity date marks the end of the term. At this time, you can repay the balance of the principle or renegotiate the mortgage at the current rates. Note: If you choose to repay or renegotiate the mortgage before the term is up, penalties may be charged.


One of the biggest factors in purchasing a home is knowing how much you qualify for when it comes to a mortgage – and how much you can afford!

To determine the amount of the mortgage you qualify for, banks will utilize a set of ratios that determine the amount of your income that will be used to pay down the debt. These ratios are Gross Debt Servicing (GDS) and Total Debt Servicing (TDS).

It sounds confusing, but let us help break this down for you!


The first ratio, Gross Debt Servicing (GDS) is the percentage of gross income that is required to cover housing costs. If you are looking at getting an insured mortgage (less than 20 percent down payment on the purchase price) the limit is 32% GDS. For uninsured mortgages (20 percent or more down payment) the limit is 39% GDS.

To calculate this, you would take any home-related expenses (mortgage payments, property taxes, utilities and strata fees when applicable) and divide them by gross monthly income to get your GDS percentage.

Gross Monthly Income $4,500.00
Mortgage Payment $1,000.00
Property Taxes $200.00
Heating Expenses $150.00
Total Expenses $1,350.00
Gross Debt Servicing (GDS) 30%

The rate of 30% GDS is well within the requirements and would be approved.


The other ratio banks use is known as Total Debt Servicing (TDS). This is the percentage of your gross income required to cover housing costs (same as with the GDS) but also any other debts. The guidelines for an insured mortgage (less than 20 percent down) have a limit of 40% TDS while an uninsured mortgage (20 percent or more down) is 44% TDS.

To calculate this, you would take all home-related expenses (mortgage payments, property taxes, utilities, and strata fees when applicable) and other debts (credit cards, personal loans, student loans, car payment,s or a line of credit) and divide them by gross monthly income to get your TDS percentage.

Gross Monthly Income $4,500.00
Mortgage Payment $1,000.00
Property Taxes $200.00
Heating Expenses $150.00
Student Loan Payment $100.00
Car Payment $300.00
Total Expenses $1,750.00
Total Debt Servicing (TDS) 39%

The rate of 39% TDS is well within the requirements and would be approved.


In order to get approved for the mortgage, you need to declare your income so the bank can compare it to your expenses and determine the ratios noted above.

If you are employed with a company, you would provide an employee statement declaring minimum guaranteed gross wage OR last two-year average if there were bonuses or commissions that put your income above your guaranteed wages. If the most recent year was lower, that year will be used instead of the average.

If you are self-employed, you would provide the average of your last two years of income based on line 150 of your tax returns. It is important to know that there are programs available for self-employed borrowers in cases where the two-year average does not qualify them for a mortgage. Just ask your mortgage broker!


There are many cases where buyers will qualify for more than they intend on spending – but don’t get greedy! It is vastly more important, especially for your first home, to stay within a budget that you can afford each month instead of overextending yourself simply because it is available to you. The most important aspect is that your payments are reasonable and affordable. There are always options to move to a larger home in the future!