20 May

When Home Owners Divorce


Posted by: Cory Lewis

Divorces can be difficult and expensive, however good mortgage advice early can save you considerable stress and money. The first thing I will tell my clients who are starting the separation process is to continue with keeping all joint loans and payments up to date. If it is a less than amicable situation, we will often find that disputes over financial responsibility will result in payments being missed and as a result credit ratings being affected negatively. By not paying a joint debt you are sabotaging your own credit worthiness and ability to qualify for mortgages and loans in the future on your own. Keep good records of payments and if necessary, you can seek reimbursement through your lawyers at the time of negotiation and divorce.


Marital Home Buyout

When it comes to the marital home, if one party would like to remain in the property and buyout their spouse, there are a couple of options.

Option 1

  •  Refinance the home conventionally.
  • One party can refinance the property up to 80% of the value of the home. This person will need to qualify for the mortgage and any other liabilities on their income alone or with a possible cosigner.


Option 2

  •  Refinance through Genworth or CMHC’s spousal buyout program.
  • Qualified clients can refinance the home to up to 95% of the value of the property.
  • CMHC’s spousal buyout program will allow the equity to be used only to pay out the spouse and not for any other debts or penalties.
  • Genworth will allow the funds from the refinance to be used to pay off other matrimonial debts and mortgage penalties as long as they are specified in the separation agreement.
  • For refinances over 80% loan to value clients will be subject to mortgage default insurance premiums. If the mortgage was originally CMHC or Genworth insured clients may just face a smaller top up premium, however if not, a full premium will apply.



At the time of mortgage approval, in addition to income verification and other standard conditions most lenders will require:

-A Separation Agreement. Lenders will not want to finalize a mortgage approval until there is a separation agreement in place outlining the split of assets. This protects both the lender and the client as a soon to be ex spouse could make a claim against any assets in your name.

-Proof of Support Payments: If there are child or spousal support payments and these are needed as income for the buyer to qualify, further documentation will be required. The payment amounts should be specified in the separation agreement and most lender will request up to 3 months worth of bank statements showing that the support payments are being made / received.

-An Offer to Purchase between the two spouses for the subject property (in the case of a spousal buyout).

-An Appraisal (in the case of a spousal buyout): As this transaction is not at arms length the bank or insurer will order an appraisal be completed on the property to confirm market value.


As always, I am available to help and answer any questions you may have. Please contact me anytime.


Cory Lewis – Jencor Mortgage   1

20 Feb

Morneau Eases Stress Test on Insured Mortgages


Posted by: Cory Lewis

Minister Morneau Announces New Benchmark Rate for Qualifying For Insured Mortgages

The new qualifying rate will be the mortgage contract rate or a newly created benchmark very close to it plus 200 basis points, in either case. The News Release from the Department of Finance Canada states, “the Government of Canada has introduced measures to help more Canadians achieve their housing needs while also taking measured actions to contain risks in the housing market. A stable and healthy housing market is part of a strong economy, which is vital to building and supporting a strong middle class.”

These changes will come into effect on April 6, 2020. The new benchmark rate will be the weekly median 5-year fixed insured mortgage rate from mortgage insurance applications, plus 2%.

This follows a recent review by federal financial agencies, which concluded that the minimum qualifying rate should be more dynamic to reflect the evolution of market conditions better. Overall, the review concluded that the mortgage stress test is working to ensure that home buyers are able to afford their homes even if interest rates rise, incomes change, or families are faced with unforeseen expenses.

This adjustment to the stress test will allow it to be more representative of the mortgage rates offered by lenders and more responsive to market conditions.

The Office of the Superintendent of Financial Institutions (OSFI) also announced today that it is considering the same new benchmark rate to determine the minimum qualifying rate for uninsured mortgages.

The existing qualification rule, which was introduced in 2016 for insured mortgages and in 2018 for uninsured mortgages, wasn’t responsive enough to the recent drop in lending interest rates — effectively making the stress test too tight. The earlier rule established the big-six bank posted rate plus 2 percentage points as the qualifying rate. Banks have increasingly held back from adjusting their posted rates when 5-year market yields moved downward. With rates falling sharply in recent weeks, especially since the coronavirus scare, the gap between posted and contract mortgage rates has widened even more than what was already evident in the past two years.

This move, effective April 6, should reduce the qualifying rate by about 30 basis points if contract rates remain at roughly today’s levels. According to a Department of Finance official, “As of February 18, 2020, based on the weekly median 5-year fixed insured mortgage rate from insured mortgage applications received by the Canada Mortgage and Housing Corporation, the new benchmark rate would be roughly 4.89%.”  That’s 30 basis points less than today’s benchmark rate of 5.19%.

The Bank of Canada will calculate this new benchmark weekly, based on actual rates from mortgage insurance applications, as underwritten by Canada’s three default insurers.

OSFI confirmed today that it, too, is considering the new benchmark rate for its minimum stress test rate on uninsured mortgages (mortgages with at least 20% equity).

“The proposed new benchmark for uninsured mortgages is based on rates from mortgage applications submitted by a wide variety of lenders, which makes it more representative of both the broader market and fluctuations in actual contract rates,” OSFI said in its release.

“In addition to introducing a more accurate floor, OSFI’s proposal maintains cohesion between the benchmarks used to qualify both uninsured and insured mortgages.” (Thank goodness, as the last thing the mortgage market needs is more complexity.)

The new rules will certainly add to what was already likely to be a buoyant spring housing market. While it might boost buying power by just 3% (depending on what the new benchmark turns out to be on April 6), the psychological boost will be positive. Homebuyers—particularly first-time buyers—are already worried about affordability, given the double-digit gains of the last 12 months.

If you have any questions, please feel free to contact me anytime. Cory Lewis – Jencor Mortgage

Blog Posted February 18th, 2020 by Dr. Sherry Cooper – Chief Economist, Dominion Lending Centers


23 Jan

The Ins & Outs of Pre-Approvals


Posted by: Cory Lewis


1.Gas Station Sushi

2.Emails from Nigerian Princes

3.60 Second Online Mortgage Pre-Approvals


Not all mortgage pre-approvals are created equally.

Many lenders offer quick and easy pre-qualification numbers for their clients and others will issue written pre-approval letters without any documentation requirements. As we all know, this can lead to heartache down the road when a deal goes live and an offer to purchase is in place.

My clients are offered a fully underwritten Pre-Approval.


The Top 3 Questions clients have about Mortgage Pre-Approvals:


  1. What is an Underwritten Pre-Approval?

A fully underwritten preapproval ensures that not only we take a full application, but we collect and review the client’s paperwork upfront. This is not standard practice in the industry unfortunately.  A client’s ability to qualify for a mortgage hinges on 4 main criteria– Their provable income, their down payment, AND their credit bureau showing their ratings and liabilities. Collecting and reviewing this information upfront helps us avoid any confusion or disappointment at the time of purchase. Through no fault of their own, clients often misrepresent their information on a mortgage application.

For example, with an online application a client may advise that their annual income is $120k, (understandably basing this on their tax return info from the previous year). However, every lender has their own rules and document requirements for proving and accepting various income sources. Unless this is 100% salaried income – we need to investigate further to determine the income that can be used – IE: Hourly rates, shift premiums, taxable benefits, support payments, child tax credits, and  self-employment income are all handled differently.


  1. If I am Pre-Approved, Why do I need a Finance Condition in my Offer?

I will always advise any client who requires a mortgage, preapproved or not –make their offer conditional to financing. The reason for this is that the client themselves is only half of the equation. The lender also has to approve the property in question, and this cannot happen until a written offer to purchase is in place. A lender may approve a client but decline a property. This could be due to any number of reasons, for example, a lower appraised value or special assessments that are disclosed once reviewing the condo documents.

Clients also need to be aware that a preapproval is based on their information at the time of application. If there are any material changes to their information (new debts, income or employment changes etc.) this can also affect their approval at the time of purchase. I always advise my clients contact me before making any material changes or applying for any new loans or liabilities.


  1. Does a Pre-Approval come with any Obligation?

The answer is NO.

Most Pre-Approvals are good for 120 days and come with a rate hold for that period. If you decide not to purchase or use this preapproval it simply expires after that 4 months. It can be cancelled at any time or renewed at expiry if desired. The main benefit to the rate hold is that it does protect the client from any rate increases over the 120 period.

Another great advantage to working with a Mortgage Advisor who has access to  many lender options is that we will always shop around again for our clients  at the time of purchase . If some time has passed since the pre-approval was issued, we may find a better rate or product on the market and opt not to proceed with the lender who pre-approved you.

9 Jan



Posted by: Cory Lewis

One of the decisions you will need to make before your new mortgage is set up, is what kind of payment frequency you would like to have. For many, sticking to a monthly payment is the default, however, different frequencies may end up saving you less interest over time.

Monthly Payments

Monthly payments are exactly as they sound, one payment every month until the maturity date of you mortgage at the end of your term. Took a 3-year term? You will make 36 payments (12 payments a year) and then you will need to renegotiate your interest rate. 5-year term? You will make 60 payments.

$500,000 mortgage

3% interest rate

5-year term

$2,366.23 monthly payment


$427,372.90 remaining over 20 years

$69,346.70 paid to interest

$72,627.01 paid to principal


Semi Monthly

Semi-monthly is not bi-weekly. Semi monthly is your monthly payment divided by two. That means, you are making 24 payments every year, but each payment is slightly less than half of what the monthly payment would of been.

$500,000 mortgage

3% interest rate

5-year term

$1,182.38 semi monthly payment


$427,372.99 remaining over 20 years

$69,258.59 paid to interest

$72,627.01 paid to principal



Bi-weekly, you are not making 2 payments every month. With 52 weeks in a year, you are actually making 26 payments, 2 more than semi-monthly (2 months a year you make 3 bi-weekly payments). The interest paid and balance owing are slightly less than the others, but mere cents. You will still need to make payments for another 20 years.

$500,000 mortgage

3% interest rate

5-year term

$1,091.38 bi-weekly payment


$427,372.36 remaining over 20 years

$69,251.76 paid to interest

$72,627.64 paid to principal


Accelerated Bi-Weekly

Just like regular bi-weekly, you are not making 2 payments every month. With 52 weeks in a year, you are actually making 26 payments, 2 more than semi-monthly. However because this is accelerated, the payment amount is higher.

$500,000 mortgage

3% interest rate

5-year term

$1,183.11 accelerated bi-weekly payment


$414,521.40 remaining over 17 years 4 months

$68,325.70 paid to interest

$85,478.60 paid to principal


You have increased your yearly payment amount by $2,384.98, $11,924.90 over 5-years. That extra $11,924.90 has decreased your outstanding balance at the end of your mortgage term by $12,850.96 because more of your payments went to principal and less went to interest. Also, you will now have your mortgage paid off more than 2.5 years earlier.

The same option is available for accelerated weekly payments which will shave another month off of time required to pay back the whole loan as well. If you can afford to go accelerated, your best option is to do so! Especially in the early years where a larger portion of your payments are going towards interest, not paying down your principal.

If you have any questions, please do not hesitate to reach out to me anytime. Cory Lewis – Jencor Mortgage


Original post by Ryan Oake – Dominion Lending Centers – Accredited Mortgage Professional

14 Nov



Posted by: Cory Lewis

Every so often I have a client who does not qualify for a standard mortgage and will look at a rent to own as a potential option. Though I only have limited involvement in these transactions until the very end, I do try to educate my clients on the process and potential risks involved so they can make an informed decision.

The most common reasons for not qualifying would be that they either do not yet have a down payment OR perhaps credit issues that need some work before qualifying.

The property owner and the tenant will come to an agreement on the  purchase price and the contracts are usually set up with the tenant paying an initial deposit and a premium on regular monthly rent. For example, if market rent should be $1200 per month the client may pay $1600. The additional $400 per month is typically held in a trust account for the term of the rent to own contract, say 3 years. After the 3 years is up the cash in the trust account can be used for their down payment upon qualifying for a mortgage.

What could possibly go wrong? 

Property Value Issues: If at the end of the term the value of the property is not at least equal to the original agreed upon purchase price – the banks may not finance the home. For example, if the contract sets the price at 300K and values drop within the 3 years to 280K the client will now need both a minimum 5% down payment on the 280K value AS WELL as an extra 20K to make up for the value discrepancy. Appraisals are almost always required on ‘rent to own’ homes and this is the biggest issue I have seen over the last few years.

Qualifying Issues: Again, at the 3 year mark the tenant will have to qualify to buy the home. Mortgage rules are constantly changing so a buyer who qualifies based on today’s guidelines may not qualify in 3 years time. If the tenant happens to develop some credit issues within the 3 year contract or lose their jobs/take a pay cut ,they may not qualify to get a mortgage at all. Most rent to own contracts are based on 5% down payments at the end of the term. With less than a 20% down payment in the trust account – the mortgage default insurers (CMHC  / Genworth / CG) have to approve the buyers , property  and contract as well as the lender.

Owner Defaults: What kind of protection does the tenant have if the current owner of the home stops paying his mortgage or property taxes? Usually NONE. If the current owner stops paying the bank the property could be foreclosed upon while the tenant is occupying the property and fulfilling their end of the bargain.

What does the tenant have to lose? Often these contracts are drawn up in favor of the owner, not the tenant. If the tenant misses a rent payment or does not qualify at the end of the rent to own contract the tenant may lose some or all of their deposit and down payment in trust.

What should one do if considering a rent to own property? ALWAYS seek legal advice. Do not use the seller’s lawyer, It may cost you extra to have your own lawyer review the contract but it is important to have your own representation. Also, speak with a mortgage professional in advance. You will want to ensure that after the rent to own term is up that you have the best chance possible at qualifying for a  mortgage.

31 Oct

Purchasing a Condo?


Posted by: Cory Lewis

Condo Considerations

What you need to know when it comes to financing.

Condos are an affordable option considered by many first time home buyers. However, what many aren’t aware of is that they can be more complicated than a single family home when it comes to qualifying for a mortgage and securing financing.

When you purchase a condo, the investment involves not only your unit, but the condo corporation as a whole. The condo corp needs to be in good standing for a lender to be comfortable approving your mortgage.

What should I be looking for?

Are the financials up to date?

  • Banks typically will not finance a property without up to date financial statements.

Are there any pending special assessments?

  • Outstanding Special Assessments can be a big problem for lenders. For example:  If your condo requires a new roof right away and there isn’t enough money in the reserve fund to cover the costs of this expense – the condo will issue a special assessment. The bill will be divided between all of the units in the building accordingly and each owner will be responsible for coming up with their share of the costs.  Unfortunately, even if you are able to pay your share of this assessment, it doesn’t guarantee that all of the other unit owners will be able to pay their share. If not, the required maintenance may not happen. Often times you will not be able to secure financing until these assessments are fully collected, assuring the lender that the needed repairs to the building now can and will be done.

Is the condo board self-governed?

  • For a self directed condo board, the lending options can be more limited. Not all lenders are comfortable with this, however there are still options. This can be fairly common place in smaller condos with only a few units.

Post Tension Cables?

  • Post tension cables are sometimes used to reinforce concrete during a condominiums construction. If properly installed and maintained there are typically no issues,  however if not properly maintained they  can corrode and result in very expensive repairs. As such , not all lenders and insurers will finance these properties.  If your condo was built using post tension cables you may be limited in your lender and insurer options. You can also expect that recent engineer reports will be requested at the time of purchase to confirm that they are in good standing.

Age Restrictions?

  • Certain properties can come with age restrictions. For example there are building catering to seniors / 55+. CMHC will not insure age restricted properties, and many lenders will also shy away. Not only is the lending option pool reduced, but also the pool of potential qualified buyers if and when the property needs to be sold. Resale value is a key component in mortgage approvals for lenders.

Flood Damage?

  • If your condo was in a flood zone , you can expect the lender to do some detective work. They will want to ensure any and all water damage has been fully remediated and will likely request a recent engineers report to confirm the property is structurally sound.

High Percentage Of Rental Units In The Building?

  • Without a stake in the property,  rental tenants do not have a vested interest in how the condo is run, kept clean and in good repair. This is also something the banks will look at when deciding to approve or decline a mortgage application. If the condo has a high percentage of rental units and minimal owner occupied suites – this can result in a decline.

If you have any questions or concerns, I would love to hear from you. Cory Lewis – Jencor Mortgage

22 Aug



Posted by: Cory Lewis

1) You have missed a payment/made a late payment.
Credit card payments can become a vicious cycle; you make monthly interest payments and elongate the process of chipping away at that debt. Alleviate the stress of credit card debt by consolidating smaller loans with a reverse mortgage at a much lower interest rate. By consolidating your debt with a reverse mortgage, you can eliminate the stress of having to make monthly payments towards your loan and in turn, free up your monthly income.

2) You have asked to skip a payment or are accessing your investments earlier than you’d like.
If your debt has led to missing payments or touching your RRIF or retirement accounts, consider using a reverse mortgage to unlock up to 55% of your home equity. This way you can pay off debts while your investments keep working for you.

3) You want to start crossing things off your bucket list, yet can’t afford to.
Maybe your dream is to purchase a second home like a cottage, take a vacation, or even just dine out or attend the theatre regularly. A reverse mortgage can improve your retirement lifestyle by supplementing your monthly income without affecting your OAS and pension.

4) You want to financially assist your aging parents/kids/grandkids.
As the sandwich generation, you’re caring both for kids and aging parents. That can place huge financial stress on a household. A reverse mortgage can give both you and your aging parents financial independence and the ability to help your kids/grandkids pay for their education or even assist with a down payment for their home.

5) You are facing unexpected expenses.
Maybe it’s a leaky roof or a flood in your basement. Or you might have to renovate your home, allowing you to stay in your home long term. A reverse mortgage gives you quick access funds to pay for unplanned expenses without worrying about making any payments until you move or decide to sell your home.

If any of the above examples resonate with you, the CHIP Reverse Mortgage could be great solution!  I’m always available to help! Cory Lewis – Jencor Mortgage

Originally posted by: Eric Bisaillon   – HomeEquity Bank

4 Jul



Posted by: Cory Lewis

When it comes to income qualifying for a mortgage, the lenders and insurers have different requirements for various income sources.

The majority of applicants with employment income fall under the following 6 categories:

1. Salaried Employees

2.Full Time Employees, Paid Hourly with Guaranteed Hours

3. Part Time Employees, Paid Hourly with Guaranteed Hours

For these 3 income types, a borrower’s income is paid through a business in which they do not have any interest / ownership. A lender will typically request the following paperwork as income confirmation for mortgage approval in these cases:

  • A letter of Employment stating the applicants position, date of hire and salary or hourly rate and guaranteed hours.
  •  A Recent Pay-stub
  • Many lenders will also complete a verbal income confirmation, calling the employer  / HR to verify the details and tenure details outlined on the letter of employment.

4. Shift Workers, Seasonal Workers or On-Call Employees with a 2 year history at same employer 

5. Commission Sales Employees with a 2 year history in the same role/industry

6. Contract Employees with a 2 year history in the same role/industry  

With income sources 4-6,  income verification requirements are a little more complicated. As the employer cannot guarantee the employees annual income in writing, the lenders and insurers will require we supply a 2 year history on their employment income.  The lender will look at an average of the borrowers last 2 years income if it is increasing year over year, or the lowest of the last two years if the income has decreased. This 2 year average can also be used for employees who claim tips, earn overtime or receive significant bonus income.

Income verification requirements for these income sources could be any or all of the following:

-The last 2 years of T4s from the employer(s) and  / or Personal T1 General Tax Returns

– The last 2 years of Notice of Assessments from Revenue Canada as 3rd party verification of the income claimed

-A letter of Employment or Copy of their contract stating their position, date of hire, pay rate and tenure

-A recent paystub confirming the year to date income is consistent with past years / income used on the application

As always, every lender is slightly different in their paperwork requirements and every income source is reviewed on a case by case basis. If you have a questions regarding a specific income type, please do not hesitate to call or email me anytime.

Cory Lewis

Jencor Mortgage


20 Jun



Posted by: Cory Lewis

Sometimes in life, things don’t always go as planned. This could not be truer than in the world of Real Estate. For Instance, lets say that you have just sold your home and purchased a new home. The thought was to use the proceeds of the sale of your house as the down payment the the new purchase. However, your new purchase closes on June 30th and the sale of your home and the sale of the existing house doesn’t close until July 15th – Uh-oh! This is where bridge financing can be used to ‘bridge the gap’.

Bridge Financing is a short-term down payment that assists purchases to ‘bridge’ the gap between an old and a new mortgage. It helps to get you out of a sticky situation like the one above and has a few minimal fees associated with it.

The cost of a bridge loan is comprised of two parts. The first is the interest rate that you will be charged on the amount of funds that you are borrowing. This will be based on the Prime Rate and will vary from lender to lender. As a rule, you can expect to pay Prime plus 2.5%. The second cost to consider is an administrative fee. Again, this will vary depending on the lender and can range from $200-$695.

The amount that you are able to borrow is easily calculated. The calculation looks like this:

Sale Price

(less) estimated closing cost of 7%

(less) new mortgage of the purchase property

= Bridge Financing

*Note: The closing costs include the expense of realtor commissions, property transfer tax, title insurance, legal fees and appraisal costs if applicable.

So that’s the cost side of things, now the next question is: How long? The length of time that you can have Bridge Financing is going to vary again from lender to lender as well as what province you are in. For most, it is in the range of 30-90 days but there are some lenders that will go up 120 days in certain cases.

Before applying for Bridge Financing, you must also have certain documents and be ready to present them. The documents include the following:

  1. A firm contract of purchase and sale with a copy of the signed and dated subject removal on the property that you are selling and the property that you are purchasing.
  2. An MLS listing of the property being sold & purchased.
  3. A copy of your current mortgage statement .
  4. All other lender requested docs to satisfy the new mortgage and upcoming purchase.

Once you have those documents, you can work with a qualified mortgage broker to apply for bridge Financing, it is an important tool to understand and a great one to have in your back pocket for when life throws you one of those ‘curve balls’. You can have peace of mind knowing that if/when that situation arises, you are not without a strong option that can provide you with interim financing for minimal cost.

As always, if you have any questions about Bridge Financing, or any quotations about your mortgagee (be it new or old) contact me anytime.

Cory Lewis, Jencor Mortgage

Blog posted by Geoff Lee GLM Mortgage Group Vancouver, BC

16 May

Understanding B-20 Guidelines


Posted by: Cory Lewis

A new survey has emerged showing that out of 1,901 owners and would be homeowners, 43% (more than two out of five) Canadians

are not confident in their knowledge of the mortgage stress tests—despite them being in place for more than a year now.

We wanted to give you a brief set of notes regarding the guidelines. This is something you can use and reference whether you are

a first-time home buyer or looking to refinance underneath these new guidelines. It gives a clear picture of what/how you are impacted

as a buyer or someone who is looking to refinance.

Here’s what you need to know about B-20:

The average Canadian’s home purchasing power for any given income bracket will see their borrowing power and/or buying power under

these guidelines reduced 15-25%. Here is an example of the impact the rules have on buying a home and refinancing a home.


When purchasing a new home with these new guidelines, borrowing power is also restricted. Using the scenario of a dual income family

making a combined annual income of $85,000 the borrowing amount would be:

Up To December 31 2017 After January 1 2018
Target Rate 3.34% 3.34%
Qualifying Rate 3.34% 5.34%
Maximum Mortgage Amount $560,000 $455,000
Available Down Payment $100,000 $100,000
Home Purchase Price $660,000 $555,000


A dual-income family with a combined annual income of $85,000.00. The current value of their home is $700,000. They have a

remaining mortgage balance of $415,000 and lenders will refinance to a maximum of 80% LTV. The maximum amount

available is: $560,000 minus the existing mortgage gives you $145,000 available in the equity of the home, provided you qualify

to borrow it.

Up to December 31, 2017 After January 1 2018
Target Rate 3.34% 3.34%
Qualifying Rate 3.34% 5.34%
Maximum Amount Available to Borrow $560,000 $560,000
Remaining Mortgage Balance $415,000 $415,000
Equity Able to Qualify For $145,000 $40,000

Source (TD Canada Trust)

These guidelines have been in place since January 1, 2018 and we are starting to see the full impact of them for both buyers and

those looking to refinance. Stats are showing that there is a slowdown in the real estate market, however there is also a heightened

struggle for many buyers to now obtain approval under these new guidelines. It’s a difficult situation as the cry for affordable housing

is still ongoing as the new guidelines may slow down the market but appear to further decrease the borrowing/buying power of individuals.
Keep in mind, this is just a brief refresher course on the B-20 guidelines. As always, if you have more questions or are looking for more

information, we suggest that you reach out to your Dominion Lending Centers mortgage broker to discuss and get a full and detailed look

at how it will impact you personally.  Blog Post by Geoff Lee – DLC Mortgage Group out of Vancouver B.C

Cory Lewis

Jencor Mortgage Corporation