The Power of Education

Michael Hallett • Jul 18, 2016
Knowledge is power! With education comes limitless possibilities.

Are our kids learning the essentials in life? Are they being empowered to make life-changing decisions when they enter into the real world of economics?

The education that most kids in senior secondary school receive these days focuses on biology, math, physics, chemistry, English, physical education, social studies, mechanics, wood-working and home economics, not real life!

What about personal finance? We need to teach our kids about everyday economics.

Most people remember when they got their first credit card. What a disaster that was (for some people). If we aren't taught about how to use credit, it can quickly get out of hand. Most people think that if they have a $1,000 limit all is good as long as they don't exceed the limit —FALSE! Credit scores strengthen and increase if balances are at or less than 30% of the limit. There you go, you may have just learned something. What are most teenagers more concerned with, the growth of one's mutual fund or the latest and greatest Apple product.

Why not educate our kids about credit, day-to-day banking, mortgage financing, stocks, mutual funds etc... before leaving the protective confines of the International Bank of Mom and Dad. 

My entire mortgage practice is based solely on information and education — just look at the title of this monthly email. ALL of my clients are provided options in order for them to make an informed choice. I encourage all my clients to ask as many questions as possible, if there are unanswered questions then I am not doing my job correctly.

It's never too late to learn. The brain is a muscle that constantly needs exercise and craves new data. Keep feeding it. Ask questions, even if the answer seems obvious. Maybe the person answering will put a slightly different twist on the topic and reveal something new to you. This business I'm involved in yield new information on a daily basis, I thrive on it and it's a necessity of survival.

Here is an open invitation to all of you that made it through this blog. If you or your teenage child(ren) want a FREE comprehensive tutorial about how CREDIT REPORTS & SCORES are determined — more importantly, how bad credit and habits created now can affect your livelihood in the future — please contact me. I'm easily accessed by phone 604-616-2266 or by email michael@hallettmortgage.com.

Education is a priority for me, it should be for you too!

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Amazing stats about learning

  • 25% of children starting kindergarten in Canada lack the skills needed to learn how to read.
  • Every time 350,000 Canadians learn to read, our GDP goes up by $32 billion (i.e., a 1% increase in the nation’s literacy rate translates into a 2.5% GDP increase).
  • On average, Google processes over 40,000 search queries every second, over 3.5 billion searches per day and 1.2 trillion searches per year worldwide… whatever it may be, we are always learning.

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MICHAEL HALLETT
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Protect Yourself at Renewal

By Michael Hallett • 15 May, 2024
It’s a commonly held belief that if you’ve made your mortgage payments on time throughout the entirety of your mortgage term, that the lender is somehow obligated to renew your mortgage. The truth is, a lender is never under any obligation to renew your mortgage. When you sign a mortgage contract, the lender draws it up for a defined time, so when that term comes to an end, the lender has every right to call the loan. Now, granted, most lenders are happy to renew your mortgage, but several factors could come into play to prevent this from happening, including the following: You’ve missed mortgage payments over the term. The lender becomes aware that you’ve recently claimed bankruptcy. The lender becomes aware that you’re going through a separation or divorce. The lender becomes aware that you lost your job. Someone on the initial mortgage contract has passed away. The lender no longer likes the economic climate and/or geographic location of your property. The lender is no longer licensed to lend money in Canada. Again, while most lenders are happy to renew your mortgage at the end of the term, you need to understand that they are not under any obligation to do so. So how do you protect yourself? Well, the first plan of action is to get out in front of things. At least 120 days before your mortgage term expires, you should be speaking with an independent mortgage professional to discuss all of your options. By giving yourself this lead time and seeking professional advice, you put yourself in the best position to proactively look at all your options and decide what’s best for you. When assessing your options at the time of renewal, even if the lender offers you a mortgage renewal, staying with your current lender is just one of the options you have. Just because your current lender was the best option when you got your mortgage doesn’t mean they are still the best option this time around. The goal is to assess all your options and choose the one that lowers your overall cost of borrowing. It’s never a good idea to sign a mortgage renewal without looking at all your options. Also, dealing with an independent mortgage professional instead of directly with the lender ensures you have someone working for you, on your team, instead of seeking guidance from someone with the lender’s best interest in mind. So if you have a mortgage that’s up for renewal, whether you’re being offered a renewal or not, the best plan of action is to protect yourself by working with an independent mortgage professional. Please connect anytime; it would be a pleasure to work with you!

The Property Matters in Mortgage Financing

By Michael Hallett • 08 May, 2024
When looking to qualify for a mortgage, typically, a lender will want to review four areas of your mortgage application: income, credit, downpayment/equity and the property itself. Assuming you have a great job, excellent credit, and sufficient money in the bank to qualify for a mortgage, if the property you’re looking to purchase isn’t in good condition, if you don't have a plan, you might get some pushback from the lender. The property matters to the lender because they hold it as collateral if you default on your mortgage. As such, you can expect that a lender will make every effort to ensure that any property they finance is in good repair. Because in the rare case that you happen to default on your mortgage, they want to know that if they have to repossess, they can sell the property quickly and recoup their money. So when assessing the property as part of any mortgage transaction, an appraisal is always required to establish value. If your mortgage requires default mortgage insurance through CMHC, Sagen (formerly Genworth), or Canada Guaranty, they’ll likely use an automated system to appraise the property where the assessment happens online. A physical appraisal is required for conventional mortgage applications, which means an appraiser will assess the property on-site. So why is this important to know? Well, because even if you have a great job, excellent credit, and money in the bank, you shouldn’t assume that you’ll be guaranteed mortgage financing. A preapproval can only take you so far. Once the mortgage process has started, the lender will always assess the property you’re looking to purchase. Understanding this ahead of time prevents misunderstandings and will bring clarity to the mortgage process. Practically applied, if you’re attempting to buy a property in a hot housing market and you go in with an offer without a condition of financing, once the appraisal is complete, if the lender isn’t satisfied with the state or value of the property, you could lose your deposit. Now, what happens if you’d like to purchase a property that isn’t in the best condition? Being proactive includes knowing that there is a purchase plus improvements program that can allow you to buy a property and include some of the cost of the renovations in the mortgage. It’s not as simple as just increasing the mortgage amount and then getting the work done, there’s a process to follow, but it’s very doable. So if you have any questions about financing your next property or potentially using a purchase plus improvements to buy a property that needs a little work, please connect anytime. It would be a pleasure to walk you through the process.
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