(EP: 142) Buying a home when 'New to Canada' - Money Saving Tips for Home Owners

Winnipeg’s Real Estate Podcast Nov 26^th Transcript

[00:00:00] Bo Kauffmann - REALTOR: [00:00:00] In today's episode number one 42, our main topic is going to be mortgage options for buyers who are new to Canada. We'll also touch on a few points on how to get your home ready for the market and talk about some home insurance options all on this episode of Winnipeg's real estate podcast.

You're listening to the bone knows real estate podcast tips and advice for home buyers, sellers, and owners with award winning Remax agent Beau Kaufman.

As many of you hopefully know, I'm a professional real estate agent specializing in helping home and condo buyers and sellers in the Winnipeg market area. That's how I earn a living. And I absolutely love what I do. I love interacting with people, explaining teaching new things about real estate and home ownership and educating buyers and sellers along the way.

That's how this podcast was born. It's a labor of love. I don't charge for ad spots or collect money from a directly. [00:01:00] If I mention a promoter local business, a service is because I've had to used it myself or recommended it to friends and family, and I've had great feedback. So if you find this podcast useful, please download the free podcast app, right to your phone.

It's super easy. Just go to Bono's dot homes slash apps, and you can choose from Apple or Android apps. So let's dive right into this week's episode. What the late fall of 2020. And if you're thinking of selling your home in either the late winter or early spring next year, believe it or not now is the time to start planning, call your agent now to do a walkthrough and give you an honest and direct feedback on your home.

This is the time for critical unvarnished information. So don't be offended and we hope that the agent is. Forthcoming enough to tell you what, if anything you should fix. So it might be hard to hear that criticism because as a homeowner, you naturally love your home and you don't want to be told any bad news, but it is important to get [00:02:00] that information now, before buyers come through the house.

So this week on Winnipeg's, we'll just take blog. I have a post about six things that you need to do to prepare your home for sale. Whether it's late winter or spring, start a few months early. The link is in the show notes as well. Which brings me to a, another topic as well. I may mention that links are in the show notes and depending on where you're listening to this, you may not be able to see show notes.

If you're listening to this on Spotify or Apple or Google or Amazon or whatever, pod catcher you're listening to, it may not have the show notes. Very easy. I've set it up to be very simple to access. Just go to Bono's dot homes slash one 42. That's the number of the episode. If you go to Bono's dot homes slash one, four, two, you'll see all the show notes with all the links and explanations below.

Spotlight well business. If you're buying a house or a condo and getting a mortgage, like most people are, you will be required to get property [00:03:00] insurance. Whether it's a bank credit union mortgage broker, doesn't matter who it's, who you're going to deal with. If they're loaning you money to pay for the home, you will need to get property insurance because they need their investment protected.

Lots of insurance providers out there. But my favorite property insurance companies are a Hughes insurance. They're located at 57 Goulay street in the dominion shopping center at the foot of the Norwood bridge. There's a couple of reasons. I liked them. The first one on a professional note, they are an insurance broker, which means that they deal with a variety of insurance companies.

And can offer you different options, like different companies have different options. So for example, a fairly new one is a what's called sewer service line protection. Now that's the line that runs from your house to the city sewer line. And depending on how old your house is, that line may be 60, 80 years old.

And if it ever breaks you, the homeowner are going to be responsible for replacing it. And guess what? That's thousands, if not tens of thousands of dollars. In [00:04:00] addition to that, some companies may be cheaper, but have higher deductibles. So you, as the homeowner are well advised to take a look at a number of different options and make an educated and informed decision.

An insurance broker will shop around and give you the different options. So on a professional level, that's why I like Ari has insurance on a personal level. I know the owner R C cook. His family has owned this insurance brokerage since 1929, Darcy and a super friendly staff have been protecting your peace of mind since 1929.

That's actually their catch line. So call Darcy at (204) 837-1960. And tell him both Sencha. So up next, we're going to make a phone call to my friend, Mike Schroeder of mortgage architects. I call them mortgage Mike, and we're going to talk about mortgage options for people that are new to Canada, whether the landed immigrants or whatever other statuses they are.

there, there are mortgage [00:05:00] options for people that are new to Canada to buy a house or a condo. And we're going to find out what those options are right after this.

Announcer: [00:05:08] Darcy's animal rescue center in Winnipeg is a charitable organization which helps save and protect our Nick and Frank, since it started 15 years ago, dark season saved and found new homes for over 10,000 cats and dogs in the house to be Darcy.

Oh, Kaufman of Remax performance. Reals is a proud supporter of Darcy's animal color, and now makes us special offer, buy or sell your house or condo in Winnipeg keys. And Beau is your agent and he'll donate $250 towards Darcy's arc.

[00:06:00] call Beau Kaufman helped his saddle buy your next home in Winnipeg, Bo. No realistic.

Bo Kauffmann - REALTOR: [00:06:15] You know, funny things happened, Mike and I had actually planned this episode several weeks back, to discuss the options for new to Canada home buyers. So it was completely fortuitous that I received a voicemail from a potential and future home buyer in England. this gentleman apparently wants to move to Canada in about a year from now.

And he's got, he's got questions about options for getting mortgages and, and what the costs are involved in buying a house. Here's his voicemail.

Mike Schroeder - Mortgage Specialist: [00:06:42] Oh, hi, Bo. I hope you're well, I'm a podcast listener from the UK. My lovely wife is a winter picker and we're looking to move back to Winnipeg with our young kids in a year or so.

And my question is this, aside from the usual downpayment and taxes, is there anything else you think we may need to consider when buying in Winnipeg we're [00:07:00] moving from abroad, particularly in relation to mortgages and credit. Otherwise, thanks for doing the podcast. It's a nice place to stay in touch with what's happening over there.

All the best. Right

Bo Kauffmann - REALTOR: [00:07:10] now, first of all, let me say, I really love getting feedback like that. It tells me that there's actually people listening and, it's making a difference. That's that's really good. A very simple way for you to leave me a voicemail like this by simply going to my podcast website page, which is at Bono's dot Holmes slash podcast.

Or if you go to this episode in particular, Bono's. DOD homes slash one four, two. Every time you go to my site, a little microphone will appear at the bottom of your screen. Just click it and leave me a voicemail. You will be required to leave an email address and I will get back in touch with you. I will play, or I may, I probably will play your voicemail, but I take your name out to keep it private love to hear from you.

But for now let's let's call Mike and see what he asked us.

[00:08:00] Hey, Mike, it's Bole. Kaufman. How you doing today?

Mike Schroeder - Mortgage Specialist: [00:08:05] Hey, doing

Bo Kauffmann - REALTOR: [00:08:05] well. How about yourself? Excellent. So you heard, I sent you that question from the gentleman in England who was thinking of moving.

Mike Schroeder - Mortgage Specialist: [00:08:13] Correct. And so it answered his question. That first question is how much for down payment do you have? He's asking you to determine what type of credit and income information we need.

for example, if you have a 25% down payment and you've been in Canada for three years or less, it doesn't matter what your income or immigration status, we can get you a mortgage at a competitive rate

Bo Kauffmann - REALTOR: [00:08:35] that kind of threw me or there it's three years or less.

Mike Schroeder - Mortgage Specialist: [00:08:39] Correct three years or less. So if you've been in Canada for less than three years, you're good to go

Bo Kauffmann - REALTOR: [00:08:44] with 25% down.

Mike Schroeder - Mortgage Specialist: [00:08:45] That's correct. Yeah. And then you can pick students. You don't have to have employment. You don't even have to have credit. That's

Bo Kauffmann - REALTOR: [00:08:51] the requirement. Cool.

Mike Schroeder - Mortgage Specialist: [00:08:54] So as we go down from there, so the next level down would be, let's say a 10% down. So if you [00:09:00] have a 10% down payment, You'll have to been at your job and in Canada or three months.

and you need to show a letter from your bank saying that you have a history of making payments. The next step. Now there will be 5% down payment. If you have a 5% down payment, you do have to be in Canada typically for 12 months. So for one full year and have a letter from your landlord showing you paid your rent

Bo Kauffmann - REALTOR: [00:09:22] on time.

Mike Schroeder - Mortgage Specialist: [00:09:23] So those are the sort of the, with the descending amounts of down payment, what's required to get a mortgage.

Bo Kauffmann - REALTOR: [00:09:29] Okay. What about a job? If 5% down, are you here for a year? You still have to do a qualifying employment, right? Correct?

Mike Schroeder - Mortgage Specialist: [00:09:36] Yes. You, you still have to have a job. You have to be off of probation and most lenders have a one to three month probationary period.

Bo Kauffmann - REALTOR: [00:09:42] Let's go back to that first one. Really, if you're in the country, even a student, a refugee, anybody who's in the country for less than three years can buy a house. And I understand you just recently did a mortgage for somebody. Tell me about that.

Mike Schroeder - Mortgage Specialist: [00:09:57] Correct. And so we helped a couple where, there was, two brothers had [00:10:00] been in Canada for 10 years and they just brought their parents over from Asia and their parents wanted to buy a house.

Well, they brought over money with them. So the parents did not have a job. They did not have any income in Canada, but because they just came here and they had a 25% down payment, they were able to buy a nice house, close to their kids.

Bo Kauffmann - REALTOR: [00:10:18] Wow. Okay. That's that's yeah, that's really awesome. That's good. And, and the rate for those people was

Mike Schroeder - Mortgage Specialist: [00:10:24] they got a rate of 2.1, 4% on a five-year fixed.

Bo Kauffmann - REALTOR: [00:10:28] That's nothing to sneeze at. That's really good. Okay. So, this gentleman who was coming from England, it really depends on how much money he's got down. If, if he has 5% down, he needs to be here for a year and have a job and qualify and all that kind of stuff. Correct.

Mike Schroeder - Mortgage Specialist: [00:10:44] The only exception on that. And there is one exception on that, that he hit a host court quickly, is that if he has an Equifax credit report, so some countries do you report to Equifax and I believe England may actually be one of them, so we can pull his Equifax credit report.

[00:11:00] We might be able to get him an exception to get a house in three months or less, but that's on an exception basis.

Bo Kauffmann - REALTOR: [00:11:06] Still has to have a job though. He still has to be working and showing income.

Mike Schroeder - Mortgage Specialist: [00:11:10] That is correct. Cause you'd have to be working a job and you'd have to be off of probation.

Bo Kauffmann - REALTOR: [00:11:14] Okay. And the only way to avoid that whole job thing, that pesky little, you know, I've got to prove that I have income is by putting 25% down.

Mike Schroeder - Mortgage Specialist: [00:11:22] That is correct. Yes.

Bo Kauffmann - REALTOR: [00:11:24] Okay. Awesome. Any other tips you want to share?  T he only other thing I would suggest is that if you've just moved to Canada and you want to buy a house shortly, Make sure that you get some alternative forms of credit in your name. So for example, you might not want to get a car loan or a credit card, which is understandable, but instead if you register the utilities in your name, cell phone, your name, internet service, or even something like a car insurance, if you make those payments on a regular basis, those count as alternative credit.

Mike Schroeder - Mortgage Specialist: [00:11:53] So you don't actually have to. Oral money to build credit. You just need to be shown that you have a track record of making monthly payments. And so if [00:12:00] you'd like a strategy of how to establish your credit, so you can get a house when you're new to Canada, I'd be happy to walk you through that process.

Bo Kauffmann - REALTOR: [00:12:07] Awesome. And that's all your ready to accept phone calls or emails from people who, uh, who need some advice in that field.

Mike Schroeder - Mortgage Specialist: [00:12:13] Exactly. It's what I do for a living and I really enjoy it.

Bo Kauffmann - REALTOR: [00:12:16] So share with me your email and your phone number.

Mike Schroeder - Mortgage Specialist: [00:12:19] Email address is mortgage@mikeschroeder.ca and can always be reached at two Oh four.

Two two nine three two

Bo Kauffmann - REALTOR: [00:12:27] one four. And I was just thinking about those tips you just gave me, probably the best thing. Of course the bills is a great way, but the best thing is to get a credit card and not abuse it. Cause if you buy a car, now you're obligated to make those three, $400 a month, whatever it is.

But if you get a credit card and start using it and paying it off right away, that's probably the best way to establish that kind of a credit history.

Mike Schroeder - Mortgage Specialist: [00:12:49] It is, and make sure you get it with a credit card, at least $2,000 limit because otherwise a lender may not recognize it. The other possibility, especially if you don't have a down payment saved up yet [00:13:00] would be either getting an RRSP loan or a GIC loan.

Because number one, it builds your credit. Number two helps you save towards the down payment so you can kill two birds with one stone.

Bo Kauffmann - REALTOR: [00:13:10] That's right. Put your money into an RSP, keep it there for three months and then you can take it out and use it as a down payment.

Mike Schroeder - Mortgage Specialist: [00:13:15] Or we can also arrange an RRSP loan.

We can loan you the money for the RSP. You make payments on that to help establish credit as well. So

Bo Kauffmann - REALTOR: [00:13:25] killing like five birds with one stone. Exactly. Plus you get

Mike Schroeder - Mortgage Specialist: [00:13:28] that bigger income tax return from lower your taxable income.

Bo Kauffmann - REALTOR: [00:13:31] Absolutely. Okay. Mike, it's been as always really educational. I appreciate it.

And, as always, I look forward to the next one.

Mike Schroeder - Mortgage Specialist: [00:13:39] Beautiful. We'll talk again later.

Bo Kauffmann - REALTOR: [00:13:41] You betcha. Bye Mike.

Welcome to a new section in this podcast. It's money saving tips for homeowners and those who want to be, I don't know why. I didn't think about this topic before it fits in. So naturally into this podcast. So here we are. God, I got to come up with a catchy name for this, [00:14:00] and I'm open to ideas today. I want to talk about saving money on water bills.

In 1999 study by the American water works association research foundation. There is a mouthful in a study on residential end uses of water, and they found that out of all the water used in a home 27% goes down the toilet 22 in the clothes washer 17 in the shower, 16 through a faucet, and 14 is just playing loss through leaks.

If your toilet was manufactured before 1994, it wastes up to a hundred dollars a year on water had toilet made prior to 1980 with swapping $200 a year. So if you have an older home, replacing those toilets will over time amount to a great investment energy saving dual flush toilets range in price for around 300 to $400 plus installation.

That means a return of around a minimum of 25% a year. Plus, unlike earlier models, which require two or three flushes today's water-saving toilets can often do [00:15:00] the job in just one flush, not to mention that it increases resale value of your home as well. If you're inclined to sell it in the near future, this is an upgrade that's worthwhile.

Another item to consider are low flow shower heads. 70% of the water that comes through the shower. Head passes through your water heater. First, adding an extra expense. They're easy to install and modern types actually changed the shape and velocity of the water to provide a high flow feel all the while saving you money.

One last tip along the same line, wash your clothes in cold water as much as possible. Just like with that shower head example, most of the water entering, the warm or hot cycle of your washer had to come through your water heater first. I don't know what it's like in your city, but here in Winnipeg, our sewer bill is directly tied to water consumption.

So if you save a buck on water, you're actually going to save a corresponding amount on the sewer bill as well. So using the above tips, you can actually save hundreds of dollars on your water bill. I hope you've enjoyed listening to this [00:16:00] podcast half as much as I enjoyed creating it. And I really do love it.

So if you like receiving this information, here's a couple of things I'm asking you to do install the free podcast app available for iOS and Android devices. I've made it super simple to do on your phone. Just go to Boknows dot homes slash A P P S that's apps and there you'll get the option. For your devices, app store downloads.

Another thing you can do is go visit this show on the web at Bono's dot homes slash one four, two. That's this episode there, you'll see the show notes and all the links. Once there you'll also see a little microphone, which enables you to leave me a comment or suggestions of how to make this podcast better.

Lastly, if you really want to show me some love, give me a five star rating again. I've made it super simple. Just go to love-the-podcast.com/ Boknows.  All these links are in the show notes, which again are at Boknowsdothomesslash and then the episode I look [00:17:00] forward to hearing from you. Bye bye.

You've been listening to Boke Hoffman of Remax performance Realty. Are you thinking of buying or selling a house or a condo in Winnipeg called bow at (204) 333-2202. Remember bone knows real estate.