Why do Lenders ask for Employment letters?

employment letters

Why do Lenders ask for Employment letters? Checking for employment letters might seem like just one more piece of paper, but it’s important.  It’s due diligence.  And it works on your behalf. A borrower will provide employment letters if requested when applying for a mortgage.  You will also need a current pay stub dated within 60 days. The mortgage broker informs the borrower for additional income documents.  A lender requests the most recent 2 years Notice of Assessments or T1 Generals (tax return) or T4s certainly if overtime or bonus income is used to qualify. Employment letters should provide the…

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What is the biggest misconception with using a Mortgage Broker?

Residential Mortgage Lenders

What is the biggest misconception with using a Mortgage Broker? One of the biggest misconceptions of using mortgage brokers is that brokers place their residential mortgages with private lenders and not banks.  That is misguided information often passed down to borrowers. There are 3 types of residential mortgage lenders that borrowers are placed with. What are the Different types of Residential Mortgage lenders? ‘A’ Lenders – ‘A’ Lenders are the big name Banks, Credit Unions and Monoline lenders.  The big name Banks in the broker channel are Scotia, TD, and ATB.  Brokers in Alberta can deal with Servus Credit Union and First Calgary. There are different Credit Unions that…

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Buy now or wait for the rates to go down?

Buy now or wait for better rates ? Recently I was asked a great question from a local realtor.  Her clients are looking to buy BUT are on the fence about whether to buy now or wait 6 months to see if the interest rates go down. With the state of the economy now, there is anticipation that home prices may drop in the future, however there is also talk that mortgage interest rates are on the increase. What is the best option for saving money? Buy now or wait 6 months? There is no crystal ball in the mortgage world. …

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4 Tips to Manage a Layoff

4 Tips to Manage Your Finances When Faced with a Layoff The Canadian economy is in a recession and there are uncertain times for many. Low oil prices and the change of both Provincial and Federal government leadership has had a tremendous impact on the economy, resulting in many layoffs in 2015. More layoffs are predicted in the upcoming months. What happens if you have lost your job or are faced with a huge income cut? Losing a job or facing an income reduction is an emotional time when many are already living pay check to pay check. Step out…

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Be Life Rich, Not House Poor

be life rich not house poor

BE LIFE RICH, NOT HOUSE POOR! Buying at the top end of your pre-approval price could be setting you up for many dull years to follow. WHY? Because, your home cost is more than just a mortgage payment. There are property taxes, maintenance, utilities and more due every month. If those add up to 35% of your total income, you’re on the right track. If not you might have to sacrifice in other categories such as vacation, debt repayment or savings. Budgeting is really a piece of cake, or a pie in this circumstance. The pie chart here illustrates a…

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