Lori Wolfe 780-962-8580

Estimate the Total Cost of Your Home Purchase

Determining Your Household Budget Worksheet

Professionals Who Can Help You with Homebuying

RED FLAGS FOR CONTRACTOR FRAUD
With Spring on its way and many homeowners thing about fixing up or remodeling their homes, it’s always wise to educate yourself on signs of contractor fraud to ensure you don’t end up paying for work that never gets completed.

Following the five red flags that may indicate a contractor is not legitimate:

1.  The company does not list a number in the phone book.  This may indicated a fly-by-night operation that will be here today and gone tomorrow.  They may seem legitimate in the beginning but, as soon as you make your first payment for the job, they may vanish.

2.  Asks how to pay for the entire job up front.  This contractor will be long gone well before your project gets underway.  Or, worse yet, the contractor may have started the project, leaving you with a ripped up home and depleted funds.

3.  Only accepts cash.  A legitimate business should have the appropriate financial accounts in place to accept a variety of payment options from clients, including personal cheques and credit cards.  If a contractor only accepts cash, you probably won’t see them again once they receive a payment.

4.  Solicits door to door.  Most legitimate contractors find enough work through word-of-mouth referrals and advertising. If they need to drum up business by going door to door, they probably are not an established, local operation.  Chances are this contractor is running a fly-by-night business.

5.  Offers exceptionally long guarantees.  The contractor may be making promises that can’t be kept solely to sucker you into hiring them for the job.  The contractor could be inexperienced or may be running a fly-by-night business.

The best way to protect yourself from contractor fraud is to seek referrals from people you trust who can vouch for the contractor including friends, family, colleagues or your mortgage or real estate professional.

It’s also important to read and understand every word of a contract before signing it.  If you don’t understand something, ask for clarification.

Also keep in mind that you should never sign a contract with a service professional who makes promises that sound too good to be true.  Chances are, this contractor needs to create these incentives to attract customers.  If that’s the case, the contractor’s record can’t speak for itself.

Be especially wary of contractors who try to scare you into signing for repairs that they say are “urgent”.  Before agreeing to any additional costly repairs, seek a second opinion.

Just call me at 780-962-8580 if you would like to know more.
Bernie Larson
RE/MAX Real Estate
780-962-8580

Buying a home is one of the most important financial and lifestyle decisions you will ever make. To ensure you make smart home buying decisions from start to finish here is a list of step-by-step tips.

Step 1 — Make Sure You’re Ready

Before you start your search, make sure homeownership is right for you. Ask yourself some

fundamental questions. Are you planning on relocating soon? Can you manage home repairs?
Step 2 — Know Your Financial Situation

Evaluate your current financial situation by calculating your net worth and reviewing your monthly

expenses and debt payments. Ask a mortgage professional how much mortgage you can afford and

the maximum house price that you should be considering.   Obtain mortgage pre-approval to make buying a home less time-consuming.
Step 3 — Calculate Costs

Make a list and calculate the upfront costs and other expenses associated with buying and owning a

home to make sure you’re financially prepared.
Step 4 — Determine Your Needs

Before you start searching for a home, think about your current and future housing needs, which
Step 5 — Find the Right Professionals

Buying a home requires the services of real estate professionals, lawyers, mortgage professionals,

home inspectors and so on. It will give you peace of mind to have experts on your team to answer

your many questions along the way.
Step 6 — Start the Search

Now it’s time to start your home search. Don’t forget to consider the wide array of search options you

have at your disposal, including friends and family.
Step 7 — Make an Offer

Once you’ve found the home you want to buy, you will need to present the vendor with an Offer to

Purchase or Agreement of Purchase and Sale. Your real estate agent and/or your lawyer/notary can

help you to prepare your offer.
Step 8 — Close the Deal

Closing day is the day you finally achieve your goal — you get to call your new house your own. Quite

a few things get done on closing day, and you may also require the services of a mover.
Step 9 — Budget, Budget, Budget

The financial responsibilities of homeownership begin when you take possession of your home. You

need to budget for mortgage payments, ongoing operating costs and an emergency fund.
Step 10 — Home Maintenance

Keep it up. Maintenance, repair and renovations are a normal part of homeownership. Regular

maintenance will help you keep your home in top condition and protect your investment.

For more information contact me today!
Bernie Larson
RE/MAX Real Estate
780-962-8580
16 Westgrove Drive
Spruce Grove, AB T7X 3X3

Becoming Mortgage-Free Faster

Regardless of how long you’ve had your mortgage or how large or small the current balance is, there are a variety of ways to make prepayments work for you to pay down your mortgage faster and, therefore, pay less interest throughout the life of your mortgage.  After all, each extra payment amount will reduce your principal balance, which, in turn, reduces the amount of interest you’ll have to pay on your borrowed mortgage amount.

Most lenders allow you to make a lump-sum payment of anywhere between 10% and 25% of the value of your mortgage per year. The lump-sum payment is based on either the original amount you borrowed or the amount currently outstanding. Since mortgages decrease with each payment, it’s best to negotiate a lump-sum payment option based on the original amount you borrow. That way, if you come into an inheritance, a bonus or save some extra money, you can pay down the largest amount possible.

Another factor to consider is when you can make a lump-sum payment. Some mortgages allow prepayments throughout the year, while others permit them only on the anniversary date. Still others allow you to make prepayments on the day you make your regular payment.  If you can’t pay the maximum prepayment amount, it’s still worth your while to at least make some form of extra payments, even if it’s a few thousand dollars each year. That will still save you thousands of dollars in interest payments throughout the life of your mortgage.  Another prepayment option involves taking advantage of flexible payments. Most lenders allow you to increase your regular payment up to a set maximum, such as 15%, while others allow you to double up your payments.  If, for instance, you have a $1,000 per month mortgage payment and increase it by 15% to $1,150, you could shave off as much as five-and-a-half years on a $200,000 mortgage.

Even rounding up your mortgage payments a few dollars each payment can help make your balance decline sooner. If you round up your mortgage payment from, say, $766 to an even figure such as $800, you can feel confident in knowing that every extra bit goes toward your principal.  You can also pay off your mortgage faster by moving to a different payment schedule. Instead of making monthly payments, make them biweekly or even weekly. Using an accelerated mortgage payment plan – where you make payments every two weeks as opposed to twice a month – you actually make one extra payment each calendar year. By paying more and paying faster, you reduce your principal earlier, which lowers the amount of interest you pay.  As always, if you have questions about paying your mortgage off quicker, or other mortgage-related questions, I’m here to help!

Call me today, 780-962-8580.

Bernie Larson
RE/MAX Real Estate
16 Westgrove Drive
Spruce Grove, AB T7X 3X3

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