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List of Documents for Mortgage Approval

If you are thinking of purchasing a new home these are the documents your lender will require:

  • Most Recent Pay Stub

  • Letter of Employments – on company letterhead, detailing length of tenure, job title, rate of pay, guaranteed number of hours

  • Last Two Years of T4′s

  • Last Two Years Notices of Assessment – with the most recent year showing now taxes outstanding

  • Most recent Mortgage statement from current home

  • Property Tax Assessment from current home

  • Most recent Mortgage Statement from all rental properties

  • Property Tax Assessment from all rental properties

  • Rental Agreements from all rental properties

  • Bank Statements – 90  days worth of statements from each account that down payment funds will be drawn from, if not all down payment will be covered from the sale of your current home – please ensure that all accounts show your name and account number clearly at the top and that they are unaltered

  • If down payments is to be gifted, please send in a statement showing the account number, name and corresponding deposit, to line up with the amount on the gift letter. Letter will be forwarded to you once a lender has been chosen, as each lender has a specific letter

List of Documents for Self Employed

  • Articles of Incorporation

  • Last two years company financials

  • Last two years Notices of Assessment – with the most recent year showing no taxes outstanding

  • Last two years T1 Generals

  • Most recent Mortgage Statement from current home

  • Property Tax Assessment from current home

  • Most recent Mortgage Statement from all rental properties

  • Bank Statements – 90 days worth of statements from each account that down payment funds will be draw from, if not all down payment will be covered from the sale of your current home – please ensure that all accounts show your name and account number clearly at the top and that they are unaltered

  • If down payments is to be gifted, please send in a statement showing the account number, name and corresponding deposit, to line up with the amount on the gift letter. Letter will be forwarded to you once a lender has been chosen, as each lender has a specific letter.
senior couple smiling

Do I Need Home Insurance?

Absolutely. Although some people may not think home insurance is necessary, what they may not realize is that most lenders will require proof of insurance before approving you for a mortgage.

There are however, many other reasons why home insurance is important to have: it protects your investment, you can get back what you’ve lost in the event of theft or other damage and you can rest easy at night knowing you’re covered.

For a lot of people, buying a home is the most significant investment they will ever make, and that is worth making home insurance a high priority. Keep in mind, the value of your home will generally increase over time, unlike vehicles whose value drops the minute it drives off the lot.

Nobody wants to think that catastrophe, such as a fire or flood, or a break-in, will affect their family, but being prepared ahead of time can take some of the sting out of heartbreak. With adequate coverage, home insurance can help pay for repairs or to replace expensive possessions.

Things to Remember

When buying or selling a home, it’s easy to forget about home insurance. Whether you’re buying or selling a home, here a few things to keep in mind.

Buyers

If you’ll be taking possession of your new home, and leaving your current property vacant for awhile, make sure that both properties are insured. (Contact your insurance company to ask about continuing liability coverage while discontinuing the insurance contents).

Home insurance is something best taken care of right away. Make sure your insurance company is aware of all the features of your new home that may reduce your premiums, such as sprinkler systems, alarms and wired-in smoke detectors.

Sellers

Once your property has sold, you’ll need to contact your insurance company to let them know the date that ownership of your property will be transferred. They’ll arrange to cancel your insurance once you’re no longer the owner of that property.

Realty in Red Deer

If you’re buying or selling a home in the Red Deer area, Realty in Red Deer can help. We say our team is “Your Connection to Real Results,” because it’s true. If you’re selling, our team has the market knowledge and expertise to get you the right price for your home, and if you’re buying, we have a great variety of listings in Red Deer, Blackfalds, Lacombe, Sylvan Lake, etc., and we can connect you to the home of your dreams. Please don’t hesitate to contact us if you have any questions.

If you are in need of home insurance, one of our partners (listed under Resources) may be able to help you.

Types of Mortgages

Fortunately for buyers, there are a variety of mortgage to choose from. It is in your best interest to investigate each of them to determine which is the best for your situation. You probably won’t qualify for all of them. In fact you may only qualify for one. But if you qualify for more than one, you may save yourself money (and worry) in the long term if you do your homework before signing on the dotted line.

Fixed Rate Mortgages – A fixed rate mortgage is where the rate of interest and payment amounts are fixed for a specific term. This is a good option of you are planning on living in your home for many years of you are not a risk taker and prefer the stability of knowing how much your payment will be each month for the term of the loan.

Closed and Open Mortgages – A closed mortgage agreement does not provide for payout before the maturity date. A lender may permit early payout of a closed mortgage under certain circumstances but will charge a penalty for doing so. An open mortgage permits for prepayment / payout in full at any time without penalty. Many lenders allow you to increase your payments by 20% each year or prepay up to 20% of your loan each year without penalty. Check with your lender to find out what options are available to you should you choose a closed term mortgage.

Open Fixed Rate Mortgages – Choose an open fixed rate mortgage when you want the security and stability of a fixed rate mortgage with the flexibility to pay off your mortgage or make additional payments at any time without penalty.

Variable Rate Mortgages – Choose a variable rate mortgage if you are comfortable trading the peace of mind that comes with a fixed rate for the potential interest saving of a variable rate. What a variable rate mortgage, interest rates fluctuate with prime lending rate while your payment amount remains consistent over the term of the mortgage. If rates go down, a larger portion of the payment is applied to your mortgage principal, which means you could pay down your mortgage faster and save on interest payments.

Conventional Mortgage – A mortgage loan that does not exceed 80% of the lesser of the appraised value or the purchase price of the property. A mortgage that exceed that limit must be insured.

High Ratio Mortgage – A mortgage loan that exceeds 80% of the lesser of the appraised value of purchase price of the property. This mortgage must be insured and borrowers must pay an application fee and the insurance premium (which may be added to the mortgage) to the insurer.

Canada Mortgage and House Corporation (CMHC) – The Corporation of the Federal Government that provides mortgage insurance to lenders against borrow default, under the National Housing Act (NHA).

A Cash Back Mortgage could be ideal if you are a first time home buyer with a minimum down payment of 5%. The amount of money you receive is based on the size and term of your mortgage. Your cash back is paid on the date your mortgage is advanced just in time to help you cover immediate expenses, expected or otherwise!

First Time Buyer’s can borrow the down payment from their retirement savings. The Government of Canada has a home buyer’s plan (HBP) that allows you to withdraw up to $25,000 from your registered retirement saving plan (RRSP) tax free if you use it to buy or build your first home. You’ll have to repay this amount back to your RRSP’s within 15 years and there are some other conditions.

home interior

What To Look For When Buying a Home, Room By Room

When viewing a home for sale, many buyers look at the property from a “macro” perspective. They ask themselves questions like: “Is it large enough?”, “Does it have enough bedrooms?”, or “Is it in a nice neighbourhood?”

While those questions are important, it also pays to consider a potential new home from a “micro” perspective. Here are some tips on what to look for when buying a home, room by room:

Living room and family room:

Is it large enough to fit all the furniture? Are the rooms conducive to family get-togethers and entertaining? Do you need a separate living room and family room?

Kitchen:

Is it important to have enough space to eat comfortably in the kitchen as well as the dining room? Does the kitchen have all the cupboard and other storage space you need? Will your fridge fit?

Bathroom:

Is the main floor bathroom uncomfortably small? Does the ensuite bathroom have all the features you desire, such as a large tub and/or separate shower? Do you need double sinks?

Bedrooms:

Is the master bedroom large enough to fit the bed and other furniture? Does it have the closet space you need? Are the other bedrooms large enough for your needs? (It’s a good idea to get the measurements of these rooms as it can be difficult to judge measurements during a viewing.)

Basement:

Does the basement size and orientation fit with your renovation plans? Does it have the storage space you need? Storage space. This is particularly important if you’re shopping for a condo. Does the storage space or locker have the space you need?

Closets:

Are there enough closets for your needs? Is there a linen closet?

Garage:

Homeowners use the garage for more than just cars. If you plan to use this space for
storage or hobbies check that the garage will be suitable for those purposes.

Do you want more tips on selecting your next dream home? Contact the Realty in Red Deer Team today.

family smiling

Become a Savvy Home Viewer

The last thing you want to experience after purchasing a home is “ buyer’s remorse.” That’s the sinking feeling you get when you realize, days or weeks later, that you may have made the wrong decision.

Say, for example, you buy a home based on your first impressions. When you viewed it, you thought it was just perfect. Then, a few weeks after you’ve moved in, you start to notice that the bedrooms are smaller than you had originally thought and the street is loud and busy. That’s not a nice feeling!

That’s why it’s important to become a savvy home viewer. When you visit a property for sale, you need to move past your first impressions and take a comprehensive look at the property and neighbourhood. That way, there won’t be an unpleasant surprises later on.

Here same some tips on how to do just that:

  • Take the time to carefully view each room, including closets, storage areas and the basement.

  • Make sure you have measurements of all the rooms.

  • Imagine yourself living in the home. Where will you have dinner? How will your furniture look? What is it going to be like to travel to work and school each day? Where will your kids play?

  • Get a professional home inspection. Then, make sure you read and understand the report.

  • Understand and get estimates for any maintenance and repair issues, such as required bathroom upgrades or roof shingles that need replacement.

  • Walk the neighbourhood and get a clear sense of what it’s going to be like to live there.

  • Carefully consider any negative aspects before telling yourself, “I can live with this.”

The best way to ensure you don’t get buyer’s remorse is to work with a good REALTOR! As one of the top producing teams in Central Alberta, Realty in Red Deer can help. Call today.

family outdoors

Reasons to Consider Making a Move

When is it a good time to sell your property and buy another home? Whenever there’s a good reason to do so! There are many things that may motivate you to consider making a move. For example, your reasons to consider making a move may include:

  • Your current home no longer meets your needs. You may have more space than you need or you might be looking into a larger home to accommodate a growing family.

  • You’re looking for feature your current property can’t accommodate. For example, you might want to install a pool but don’t have the backyard space or you might want a larger living room for entertaining but don’t have room for a renovation.

  • You want to live in a more desirable neighbourhood. This is one of the most common motivators since the area you live in has a huge impact on your lifestyle.

  • You want to move closer to work, school, family, shopping, theatre, etc.

  • You’re simple bored of your current property and are ready for a change.

Whatever your reasons, if you’re thinking of looking for a new home – even if you haven’t made a firm decision yet – you should talk to a good REALTOR. He or She can help you understand all your options.

Realty in Red Deer is your connection for real results. Find out more on our Meet The Team page, or contact us directly.

red country barn

Moving to an Acreage in The Country

Whether in pursuit of a lifelong dream or just due to a desire for slower-paced living, there has been a real boom in Alberta lately of people wanting to buy an acreage and move to the country.

And why not? Certainly there is much to recommend the lifestyle: space, privacy, recreation. Perhaps you’ve always wanted horses, or want to be able to go quadding or fishing in your own backyard. There are many kinds of rural properties, and you could find the one that suits you best.

With the proper footwork and research these things can be yours. Without doing your homework though, your cozy reclusion to the country may feel more like being banished to the backwoods.

Among the many things you should consider, add drinking water, septic systems, garbage disposal, municipal regulations, zoning, Internet access and proximity to a school district if you have children, to the list.

When you are a rural landowner, you are often responsible for your own septic system, obtaining drinking water if there is a cistern instead of a well, maintaining private access roads, as well as your own garbage disposal.

Another good thing to keep in mind is the distance from your property to the nearest Fire Department. This may affect your insurance premiums.

Something you should consider is the natural environment of the area. Is your property in a floodplain, for example? You may be responsible for flood or fire risk management.

You will also need to know the local bylaws and regulations that may affect your property. Some of these regulations may include zoning, water rights and easements. There may be provincial rules and regulations that could affect you as well.

A rural property can be zoned as residential, agricultural or commercial. It’s important to know what uses the land is approved for before buying a property or building on it.

A good time to start searching for a rural property or acreage is in the spring or summer. At this time of year, you’ll be able to physically walk around the property and notice if some areas feel soft or soggy.

It may be a lengthy list, but moving to the country is not an insurmountable task with the help of a qualified, professional realtor. The Realty in Red Deer team has access to many beautiful acreage and other rural property listings and can help you find the right one for you. Contact us today to discuss your needs.

two children inside summer log cagin

Find The Summer Cabin of Your Dreams

Have you been dreaming of owning a summer property, such as a summer home, cottage or cabin, or other kind of recreational property? It doesn’t have to just be a dream.

A summer cabin or recreational property is a fantastic way to get away from the city when the weather is hot and let your hair down. There is a world of difference between staying at a hotel when on vacation, rather than simply spending some time at your second home.

If you’re in the market for a summer cottage, cabin or otherwise home-away-from-home, there are quite a few things you’ll need to know and consider.

Before you outright buy a place, you should have spent some time in the area, possibly renting a cabin for a few summers, to make sure it’s ideal for you and your family.

You should take some time to get to know your neighbours. If you share a lake with other summer home owners, those other people will likely have an effect on your experience. It will help if you like them!

Don’t forget to do your financial homework as well. Owning your own special summer getaway property may seem like a dream, but you’ve got to make sure your head isn’t in the clouds when it comes to dollars and sense (see what I did there?). Get pre-approved first so you know what your budget is and you can stick within it.

You may have other costs that don’t come with a regular mortgage to consider as well, such as boat fuel, docking costs, as well as possible maintenance and repairs.

With those monetary concerns in mind, make sure you weigh your needs and wants to ensure you purchase the right summer property for you. For example, how much space do you need? Do you want enough room for all of your large family to visit? Do you want to be close to water? Would you then want a private dock? Do you prefer to be more remote, or be closer to amenities?

The best way to strike a balance between your needs, wants, and your budget is to seek the expertise of a realtor who knows the area. Realty in Red Deer has access to multiple recreational property listings in Central Alberta and can help you find the right one for you.

To get started looking at properties, go to our property search page and select “recreational” under property type to find some great country getaway options or contact us.

What You Need To Know Before Buying a Revenue Property

If you think you’re ready to take the leap of investing in a revenue property, also called “rental” or “income” properties, then there are some things you’ll need to consider first.

You must check the comparable properties in the area, and not just how much money you’d like to bring on or how much you think the rental is worth, when considering what price to set the rent at.

If the rent you are asking for is significantly higher than other rental properties in the area, chances are high that you will be left without a renter. A realtor can assess your property and make a realistic recommendation for the amount of rent.

You will also need to account for fixed and unexpected expenses, such as property tax and replacing appliances, or when the suite sits empty without a renter. You should have enough money saved to cover each of these contingencies.

Before buying a revenue property, you will need to find out if proper permits were taken out when it was built. Every municipality has different bylaws and regulations on income suites. If an illegal secondary suite is reported t, the owners may find themselves paying fines or being required to gut the illegal suite at their own expense.

Before buying, have a realtor look into the zoning of the residence and to investigate if all construction was done using the proper permits.

Another important point to note is that under Canada’s new mortgage laws, a buyer must have a down payment of 20% or more for a rental property that includes one to four units.

There is much, much more that you should know, so make sure you do your research, and consult a professional.

Realty in Red Deer has the professional expertise to help you navigate your real estate needs, whether you’re looking to buy your first home, or you think you’re ready to make an investment in a revenue property. With access to Multiple Listing Services (MLS) systems, we can match you with the perfect property for your situation and budget in the Red Deer area.

shake hands

The Benefits of Using a REALTOR®

In this day and age where the Internet and ever-evolving technologies are making it easier than ever for people to connect, why use a realtor ?(Properly written “REALTOR®.”)

First of all, what is a REALTOR®? The word “realtor” and the “R” logo are actually trademarked by the Canadian Real Estate Association (CREA). The CREA is associated with the National Association of REALTORS® In the United States, as well.

This means there’s an important difference between REALTORS® and other real estate salespeople or brokers. REALTORS® are knowledgeable, are held to a standard of conduct, are expected to continue learning, and have access to Board MLS® (Multiple Listing Service) Systems (also trademarked).

More than just a database of listings, MLS® means cooperation between REALTORS® . As a buyer, that means you aren’t restricted to a set number of listings when searching for your dream home.

REALTORS® can help you with questions like: “Is it the right time to sell/buy?”, “How can I get the best price for my property?”, “How can I advertise most effectively?” They will also be able to tell you what schools and amenities are close by and the comparative market value of homes in the area when you’re buying a home.

To be a REALTOR® and hold membership in the CREA, that person is required to actively update their education through courses, professional development and workshops. They are also held to a strict code of professionalism and ethics.

There are a multitude of websites out there that allow you post your home for sale and view listings, and yes, they can help you find a buyer or ideal-looking property, but what about everything else? There are many services and tasks a realtor may perform in the process of closing a deal that are behind-the-scenes, that you may not be aware of.

Before you even meet a REALTOR® for a walk-through, they’ve likely done at least a few of the following:

  • Researched comparable properties in the area

  • Reviewed property tax information

  • Found out the lot size by checking municipal records

  • Checked the current zoning of the property

  • Verified information about previous owners

  • Identified the school district and its effect on property values

There is also a lot of paperwork and legalities involved in closing, mistakes in which could be costly for a buyer going it alone.

For more information, visit the CREA website.

Realty in Red Deer is your connection for real results. When you deal with our Realty Team, you know you are dealing with expert professionals, knowledgeable about Red Deer and its surrounding communities. Please contact us. It would be our pleasure to put our expertise to work for you.