We buy homes in British Columbia

 Should You Break Your Current Mortgage Contract to Take  Advantage of a Lower Interest Rate?

 By: RBC Advisory Services
With rates these days at historical lows, you may be wondering if it is  the right time to break your current mortgage and lock into a new term to take advantage of these low interest rates. Remember that if you have a closed mortgage, you will incur what is called a pre-payment charge.

Why do banks charge a penalty to do this?

Lenders incur significant sales, underwriting and funding costs to issue and renew mortgages.  Mortgage rates are designed to recoup these costs over the contractual mortgage term. Most of today's mortgages are 'closed' which, for similar terms, tend to have lower rates than open mortgages.  The lower rates are in large part due to the fact that there are prepayment charges which are designed to compensate the lender for the economic costs it incurs when a prepayment amount exceeds the prepayment privileges permitted under the mortgage.  These costs include prepayment transaction costs, plus the fact the lender will not receive the full term amount of interest that was designed, in part, to recover the lender’s costs to acquire the mortgage. In contrast, you can pay off an open mortgage at any time without penalty. However, rates tend to be higher than for closed mortgages with similar terms.
By: Gabor Palos - D&H Group LLP, Chartered Accountants

Owners of residential rental properties often spend significant money on the maintenance and improvement of their investments. And they often wonder whether they can deduct these expenditures on their income tax returns.

The answer is: it depends! The tax rule says that the cost of maintenance is deductible, but capital expenditures are not. How to tell the difference? Well, the difference is not always obvious and for that reason this area is the subject of frequent controversy between taxpayers and the Canada Revenue Agency (CRA). hammerMinor repairs and routine maintenance are considered “current expenses” and are deductible when incurred. A current expense simply restores the property to its original state, and has little or no long- term effect. These expenses usually recur after a relatively short period of time. On the other hand, renovations that extend the useful life of the property and improve it beyond its original condition are considered “capital expenditures” and are not deductible when they are incurred. Instead, these expenditures may be deducted in small portions over time by claiming “capital cost allowance” (tax depreciation).


Great Canadian Real Estate Crash; The Housing Bubble Has Burst, and Few Will Emerge Unscathed

By: Chris Sorensen
Keith Roy began warning his clients about a faltering Vancouver housing market in early 2012. The realtor says he was tipped off not by industry statistics, but by chatter across backyard fences. “When you hear about a homeowner who thinks his neighbour got too much money when he sold his house, you know there’s something going on,” says Roy. “That was the first clue.” The next shoe to drop was a handful of homes in desirable west side neighbourhoods that took a few extra days to sell. Sensing a shift in the market, Roy put his own house up for sale in June and penned a blog posting the following month that advised people to “cash out.” Though he was criticized by fellow agents for breaking rank, Roy says he now feels vindicated after watching Vancouver home sales crumble to their lowest point in more than decade, with prices falling 3.5 per cent since hitting a high last May. The lesson? Recognizing a looming real estate downturn is more art than science; once it shows up in the numbers, it’s too late to do much about it. “One day the phone just stops ringing,” Roy says. “Then you’re in it.”
foreclosure2If You Are Facing Pre-Foreclosure or Foreclosure, You May Be Able To Stop It
Written by: Kristen White
Foreclosure is an extremely stressful situation and the process is unknown to many people. It is important for you to know the process you are facing. Information in this article is a general overview of the Foreclosure process and mainly applies if your first mortgage is in Foreclosure and your first mortgage is with a larger banking institution or credit union. If you have a second, third or fourth mortgage that is in Foreclosure with a smaller  credit union or private lender, some information in this article applies but the Foreclosure process can be drastically different. We specialize in Pre-Foreclosure, please call us today if you have questions regarding your 1st, 2nd, 3rd or 4th mortgage with a larger banking institution or credit union or a smaller credit union or private lender. 1. If you have fallen behind on mortgage payments, your Bank/Lender will send you a letter and also call you to make you aware of the missed payment(s). If you don’t respond or attempt to bring your payment(s) up to date, the Foreclosure may start immediately without any further notice to you. There is no general rule on the number of missed payments it takes for your Bank/Lender to start the Foreclosure and is solely at the discrepancy of the Bank/Lender.


The demands you put on yourself can create more pressure than you know how to handle. Break the cycle of anxiety by changing the way you respond to stress.

 By: Deepak Chopra
Anxiety is like a shortcut. When faced with uncertainty, the normal response is to stop,  consider what might happen, and make a decision based on the best prediction you can make. But the anxious person doesn't go through this process; they jump right towards feeling afraid. No one enjoys uncertainty. There is always a tinge of anxiousness when you don't know what the future holds. But going straight into fear is the worst way to handle the situation because fear is almost never a good advisor. It blocks clear decision-making, and exaggerates the risks and dangers that might lie ahead.  If you are an anxious person, you need to stop making the leap into fear. But how do you do that? It requires a new way of approaching uncertainty. Life is always uncertain, and until you can embrace this fact, you will imagine risks, dangers, and threats that never materialize. Yet, suffering in your imagination is just as painful—perhaps more painful—since dealing with a crisis is always easier than waiting for one in a state of dread. The Anxious Self Many spiritual traditions speak of separation as the real cause of human misery. Separation can mean being apart from God, your soul, or the higher self. But the terminology isn’t important; even the word "spiritual" isn't crucial. What is crucial is that people are divided inside. One part of the self opposes another part. With guilt, the good fights against the bad. With anxiety, the strong part of the self is at war with the weak part.

worriedWorrying is hard to overcome because in a strange way, it actually makes a lot of sense to your mind. First, you imagine risks and sometimes you are right. So, how do you overcome anxiety when you don't even think it's a problem?

By: Deepak Chopra
Worrying is such a prevalent habit that many worrywarts don't recognize themselves as anxious. In fact, many worriers often feel justified. Why not turn the car around to double check that the doors are locked? Why not worry about how unsafe the world is because of global warming and terrorism?, Convinced of its own beliefs, worry is anxiety backed up by excuses invented by the mind. Worriers Believe They're Doing Good. In a strange way, worriers believe they are doing something good by protecting ourselves and others from danger. Since our minds are filled with every conceivable risk, we wind up being right some of the time. Like hoarders who never throw anything out, worriers uses the same logic. If one item proves useful, it justifies keeping a hundred that aren't. We don't see the obvious: worrying about ninety-nine useless things is a waste of time and emotion. But until we can accept this fact, we will feel justified.


At times, life's everyday stressors can send you into a tailspin. But if you always let your emotions rule, your body won't remember to calm down.

By Deepak Chopra
Fear is a natural reaction built into the mind-body system triggered by danger. After the danger is past, so is the fear response. But when fear spreads out into a general condition, it becomes a mysterious thing: anxiety. Anxious people are afraid even though there is nothing "out there" to be afraid of. Others overreact to triggers that ordinarily should be fairly easy to handle, such as being left alone for a day on their own. Still others are nearly paralyzed by highly specific phobias such as fear of heights, open spaces or insects. What is going on and what can we do about it? Record numbers of people in modern society, predominantly women, suffer from mild to extreme anxiety. Billions of dollars are spent every year on tranquilizers to treat this condition, yet as the doctor writes out a prescription, he knows that the cause of the condition is unknown. Since human beings have lived with the fear response before recorded history, there should be a way to heal anxiety, and perhaps the best way to approach the mild-to-moderate types is not as a disease, but as a challenge. In anxious people, fear is allowed to roam freely; we can truly say that fear rules the mind. Yet it should be that you use your emotions, not that they use you. The challenge is to bring the fear response back under control. Otherwise, anxiety becomes ingrained and over time will spiral downward. The anxious person begins to be afraid of being afraid, because she knows that she has no power against it.