After many years of working in a bank, Nicole Turcotte decided she wanted a new career. She was looking for something that would keep her excited and at the same time allow her to use her financial literacy.
“The opportunity to go into mortgage brokering occurred, and that just seemed like a really good fit,” Turcotte told the Georgia Straight in a phone interview.
As a mortgage broker, she works with homebuyers and homeowners in exploring their best financing options. By the nature of her profession, Turcotte is not tied with any financial institution, and she relies on a network of lenders.
“The problem-solving aspect of the business is what I really enjoy, and having access to numerous solutions through the brokering world is what really became interesting for me,” she said.
The Vancouver broker noted that things have become more difficult, especially for first-time homebuyers.
In January this year, the federal government tightened up lending, making it harder for many people to get a loan for a home purchase. Previously, buyers who could not put down a payment of at least 20 percent were subject to a stress test, which meant they had to qualify for a higher interest rate.
Now, borrowers who can put down an initial payment of 20 percent or more have to pass the same test. “It is a really challenging time right now because as we’ve seen, people are qualifying for less,” Turcotte said.
In B.C., the new mortgage rules have slowed down the property market. But as Turcotte pointed out, buyers have “not seen a dramatic drop in housing prices”. While noting that it can be a “very frustrating situation”, Turcotte said that buyers should not be stymied.
“The best thing that we can tell people is start out with what you can afford, be very realistic about what your budgets are, and make sure that you give yourself lots of time to plan to get to achieve your goals,” Turcotte said.
Talking about tips, here are some in Turcotte’s own words.
Best way for a first-time homebuyer to get approved for a mortgage
The best thing that you can do is to speak to a mortgage broker before you start looking for property. That’s the big one, because what they need to do …have a realistic budget. So setting a realistic budget, and then making sure that your mortgage broker has all of the financial documents that they require for an approval. So this is really going through that discovery process with your broker, and making sure that you have…everything lined up so that there are no surprises when you actually do go out purchasing.
Best way for homeowners to get a good deal when renewing their mortgage
Shop around. So whether you are doing that yourself by looking at other offers from different banks or lending institutions, or you speak to a broker who can do that for you, shopping around will be the most important because everyone’s unique situation is so different. So making sure that you know all of the options that are available to you is really important.
Best way to manage a mortgage
Here on the West Coast, especially in Vancouver, we tend to have very large mortgages. Whatever you can do to pay down your principal faster is what I recommend to clients. So even something as simple as switching from a monthly to a weekly payment can have a big impact in the overall amount of interest and how quickly you pay down your principal. So taking advantage of prepayment privileges…being able to throw whatever extra amount you have toward your mortgage when it’s possible will…in the end work out in everyone’s favour.
Best neighbourhoods for millennials to buy a home in Vancouver
Always, always consult a realtor, because they will know…the neighbourhoods [that are] the best. But my personal opinion…is that the Strathcona or Kensington–Cedar Cottage areas are the best places for millennials. Well, they’re just still up-and-coming areas of Vancouver, so there are opportunities there.
Best alternative city to Vancouver to raise a family
I love Squamish. That would be where I would recommend raising a family, not only for the lifestyle opportunities that are there. I think a lot of families have moved out that way, and it’s still a reasonable drive into Vancouver if you do need to make a commute. And not only a reasonable drive, but a beautiful drive…There are so many great opportunities now for flexible working environments where you can do…a portion in the office, a portion from home. And Squamish…it’s…45 minutes to an hour away from Vancouver. Its commute, in my personal opinion, is much nicer than, say, driving out on Highway 1.
Best advice you can share
The best tip that I can give people is to take ownership of their finances and to do it early, and to really educate themselves on the options that are out there. And I think one of the best things that goes hand in hand with mortgage planning is financial planning. And so to me…if I throw myself back 15 years and were starting again, I would say…getting my finances set up for success at an earlier age…That area really goes a long way in terms of how you can deal with mortgages and purchases and expensive life decisions going down the road.