It’s impossible to guess how many people have asked me that question.
If I had to, I think the number is probably in the hundreds.
It’s a great question.
So let’s start at the beginning…
It’s impossible to guess how many people have asked me that question.
If I had to, I think the number is probably in the hundreds.
It’s a great question.
So let’s start at the beginning…
When you got your mortgage, you meticulously shopped around for different options, weighed the pros and cons, and eventually found a good deal that suited your financial situation. You probably consulted with financial advisors and even used mortgage calculators to help you make an informed decision.
Most likely, you settled for a five-year mortgage, choosing between a fixed mortgage rate or a variable rate mortgage based on what made the most sense for you at the time.
Then, life happens. Maybe you got a new job in another city, or your family is growing and you need more space. Alternatively, perhaps the real estate market is booming and you see an opportunity for profit. Whatever the reason, after three years, you decide to sell your property.
You still have two years on your term. This means you’ll have to break your mortgage contract in order to sell. You call the bank to find out how much it will cost. When the voice on the other side of the phone tells you the figure, you can’t believe what you are hearing.
You put down the phone in a hurry, and ask yourself the following question:
You’d think that lenders would be thrilled if you wanted to be financially responsible and pay off a loan early. Contrary to popular belief, that isn’t the case at all. In fact, lenders often frown upon early repayments. This is because they make money through the interest payments that accrue over the life of the loan. When you pay off your mortgage early, you’re essentially cutting into their profits.
Lenders don’t want you to pay your loan early because they want the interest payments.
A mortgage contract includes specific language regarding the penalties you need to pay if you want to prepay your mortgage. These aren’t mere footnotes or small clauses buried in the fine print, they are essential parts of the agreement that outline the financial consequences of breaking the mortgage terms early. It’s not unusual for these penalties to be quite substantial, sometimes amounting to several months’ worth of interest payments, or even a percentage of the remaining loan balance.
Whether pay the whole mortgage off in cash, or by switching to a new mortgage, you’ll most likely have to pay these (often) astronomical penalties.
That’s why, before you sign a new mortgage contract, you’ll want to know exactly how much these penalties are.
The amount of money you’ll pay in penalties for breaking your mortgage will depend on the type of mortgage contract you have.
Variable-rate mortgages are mortgages in which the current interest rate is adjusted periodically to reflect market conditions.
If you have a variable-rate mortgage, the mortgage penalty you’ll have to pay is of three months of interest on your current balance.
In other words, if the current balance on your loan is of $100,000 and the interest rate on your mortgage is 2.79%, you’ll be paying $697.50 in penalty.
Here is how we got those numbers:
Interest rate x current balance x three-months = penalty
.0279 x 100,000 x (3/12) = $697.50
A fixed-rate mortgage is a mortgage in which interest rates and payments are fixed for the duration of the term.
This type of mortgage provides monthly financial stability, but calculating the penalty for breaking your fixed-rate mortgage is complicated.
The general rule of thumb in these cases is that when you break a fixed-rate mortgage you will pay whichever is greatest between the three-month interest or the interest rate differential.
First, calculate your three-month interest rate using the same equation as above. Here’s what that would look like using the example above.
Interest rate x current balance x three-months = penalty
Then, figure out what your interest rate differential (IRD) is.
For this, you’ll need to know the following four things: the balance on your current mortgage, your original rate, the rate you can get now, and the remaining number of months in your mortgage term. This information can normally be found on your online banking profile.
Using the same example from above, let’s assume that the current balance on your mortgage is $100,000, your original interest rate was 2.79%, the current rate is 2.59%, and you have two years (24 months) remaining in your mortgage term. In this case, your interest rate differential is $400.
Here’s how we got this number:
(Contract rate – Current market rate) x Current balance x Remainder of contract = IRD
(.0279-.0275) x 100,000 x (24/12) = $400
In this example, because the three-month interest ($697.50) is higher than the IRD ($400), your penalty will be of three-month interest rate. In many cases, however, your IRD will be much higher than the three-month interest.
Many times penalties are in the thousands or tens of thousands of dollars, meaning that you may need to reconsider whether or not to break your mortgage.
Also, some lending institutions may use different methods to calculate your interest rate differential, including variables like discounts and advances. Make sure you ask your lending institution how they calculate IRD.
First, you’ll need to get the following information:
When your mortgage started
Whether it’s variable or fixed
The term on your mortgage contract
The remaining balance
Your existing interest rate
Next, go to the Penalty Calculator on Ratehub.ca and fill out the information about your mortgage.
An example is a 3-year mortgage for $100,000 with HSBC with a 2.79% interest rate would have a $75 penalty on a variable mortgage, but a $3175 on a fixed rate. The same figures with CIBC are estimated at about $875 on variable and $3875 on fixed-rate mortgages.
It shows that rates are different for every bank and mortgage.
Here are a few things you can do to avoid paying astronomical prepayment penalties.
Your mortgage contract will most likely be the most complicated document you ever sign. That’s why it’s important that you review your mortgage contract thoroughly before signing it. This includes looking specifically at prepayment penalties.
Get some help with this from an expert and make sure you know exactly what you are signing.
Some mortgages include clauses that allow you to pre-pay up to 20% of your mortgage balance per calendar year without a penalty. If you have calculated your penalty and figured out it is going to be astronomical, you can pay down up to 20% of your mortgage, and incur the penalties on the reduced balance.
If you’re looking to buy a new property, one of the ways to avoid paying a prepayment charge is to port your mortgage. This means taking your current mortgage contract —with its current rate and terms—and transferring it from one property to another. This can only be done if you’re buying a new property at the same time as you are selling your old one, and needs to be approved by your lending institution.
If you are selling your house, this means transferring your mortgage to the buyer. Not all loans will allow you to do this (most won’t, in fact) but it could be an option if your mortgage contract allows it and your differential is very high. Ask an expert to look at your mortgage contract to make sure you qualify for this.
Have you recently moved in with your significant other or are you planning to do so?
If so, you’re entering a high-stakes game.
Like in most high-stakes games, things could go your way. If that happens, the payoff could be huge. You could, as they say, live happily ever after.
But if things don’t go well, that’s when things could start to get messy.
I asked my colleague and family lawyer: Laurence Klass from Watson Goepel to help shed some light on Cohabitation Agreements. The rest of this article is what he had to say.
Breakups are never pleasant, and unfortunately, that’s when disputes can get nasty. Most people don’t think that it will ever get to that point with someone they love, but sadly, breakups are when they see an entirely new side to the person.
I’ve seen this happen plenty of times. Two people, let’s say both of them divorced and with kids, fall in love and move in together. After a while, the relationship starts to fall apart.
Each of them brought different things they shared…but now the question of who brought what isn’t quite as clear. And as things start to unravel, the issues begin to emerge…
Who keeps the dog?
What are our kids entitled to?
What do we do with the property we bought during the time we were together?
Typically, answering these questions is tough, and becomes the center of a legal dispute.
Other times, when people have the foresight (and good advice from a lawyer), they sign a cohabitation agreement, making separations much easier.
Much like a marriage contract or a prenuptial agreement, a cohabitation agreement is a legal document signed by two people who live together or are planning to move into the same home.
Cohabs, as this written agreement is sometimes called, outline how things will be divided if the relationship were to end.
This includes who:
retains ownership of property purchased together
retains ownership of property acquired before the relationship started
takes responsibility for any debt accrued before or during the relationship
pays for household expenses; and
how inheritance would be divided if families are being combined
In British Columbia, as long as the terms are deemed fair and don’t infringe on anyone’s individual freedoms (like, for example, specifying who a person can or can’t talk to), these cohabitation agreements can be pretty wide-ranging.
Generally speaking, yes having one makes sense. If you are planning to move in with your partner it is a good idea to do so before you move in. However, if you are already living with your partner it is more important to have this agreement written and signed before two years of living together. After two years you are considered to be in a common-law relationship which is considered the same as a marriage-like relationship under BC Family Law.
If you are getting married or plan to, your cohab agreement can be worded in a way to ensure that it will still remain in force once you are married. It also gives you a chance to come to an agreement on how things will get divided while you are still in the relationship (and on good terms with your partner).
Having a cohab reduces some of the stress during breakups and helps avoid the costs involved with disputes. They also help make sure that both parties take care of their families and protect the inheritance that they give or receive from their own family members.
By having a cohabitation agreement, you are resolving in advance how to separate property if the relationship breaks down. Everything is much quicker, cost-effective, and less stressful.
In short, you can move on quicker with your life.
In BC, if a couple doesn’t have a cohabitation agreement and a dispute ensues after their relationship breaks down, the decision as to who gets what will be governed by the Family Law Act.
According to this act, property and debt is divided equally among both parties. It becomes the responsibility of each person to provide evidence proving who brought what into the relationship, which is sometimes difficult to do.
The time to have these agreements made is when people are on good terms. If you wait and the couple isn’t on good terms, lawyers get involved, and that can get pricey and could take years.
Under British Columbian law, cohabitation agreements hold the same power as a marriage contract (in fact, they are the exact same thing, except named differently).
These agreements apply to anyone in a married couple, a common law partnership, or who is living together. They can even include clauses that say that they remain valid if the status of the relationship transitions from cohabitation to a common law relationship to being legally married.
Here is a list of things that can be included in a cohabitation agreement:
How family property or an individual person’s property, like real estate, possessions, and pensions, will be divided
How shared debts will be divided
The agreement can also determine who gets what if the relationship were to end. This includes:
who owns what within the party’s assets
how much money each person puts in to run the household
how credit cards are dealt with
whether someone will receive spousal support (typically in the form of financial support) upon an eventual breakup
how any disagreements following separation will be solved
In BC, certain things cannot be included in a cohabitation agreement.
Laying out how people must act within the relationship
Stating parental responsibilities for children who have not been born.
Laying out future child support obligations for any unborn children.
Cohabitation agreements should be seen as a living document. They need to be reviewed at regular intervals to keep them current and make sure they still do what they are meant to.
We recommend that people update their cohabitation agreement every five years, or whenever a significant event, such as a marriage or the birth of a child, occurs. Additionally, if one of the members of the agreement were to suddenly receive a large sum of money or property from an inheritance, for instance, the agreement should also be reviewed.
If you would like to make sure that this update occurs at regular intervals, you can include a review clause in the document itself. This clause would be triggered after an event (such as the ones mentioned above) or could state that the agreement needs to be reviewed every couple of years to remain valid.
Whatever you choose to do, the main point is that it’s important to look at the agreement regularly to make sure it continues to work for both parties and to make sure that it hasn’t become significantly unfair.
There is a growing trend of people who choose to try to save money by using resources online to create their own cohabitation agreements.
While an online template gives the appearance of saving time and money, this is just not true.
There are plenty of precedents of people who have entrusted their property and significant debts to these online templates, only to find out that they hold no legal value, causing their assets to be divided according to the Family Law Act.
If you want your cohabitation agreement to stand up in court, you need a lawyer who knows family law and can tailor it to fit your specific needs. Both parties should also seek independent legal advice to make sure the agreement is fair and gives adequate coverage to their own best interests.
If you have any more questions about Cohabitation or Marriage Agreements, let me know and I’ll put you in touch with a family lawyer who can assist.
A big thanks to Lawrence Klass for this great information!
That might have felt like a lot of information. Here is a summary of all the key points we went over for you to reference.
A cohabitation agreement is a legal document signed by two parties who live together or plan to move into the same home. It outlines how assets, debts, and other matters will be divided in the event the relationship ends.
Cohab agreements are essential to protect you legally and to avoid disputes and complications if your relationship ends. They provide clarity on ownership of property, responsibility for debts, household expenses, and inheritance division.
In the absence of a cohabitation agreement, the shared property and debt are divided equally among both parties according to the Family Law Act. Proving ownership of assets can become challenging and lead to prolonged legal battles. Under the law, unmarried couples in a common law relationship (living together for at least 2 years) are treated as having a marriage-like relationship.
Cohabitation agreements have the same power as marriage contracts in British Columbia and apply to married couples, common law partnerships, and couples living together.
A cohab agreement can cover the division of family and individual property, shared debts, spousal support, and dispute resolution methods.
Certain aspects, such as dictating behavior within the relationship, parental responsibilities for unborn children, and future child support obligations for unborn children, cannot be included in a cohabitation agreement.
Cohabitation agreements should be considered living documents and should be reviewed regularly, especially after significant events like marriage, the birth of a child, or changes in financial circumstances.
Using online templates for your cohabitation agreement may not be legally valid. It is advisable to consult a lawyer who can tailor the agreement to specific needs and ensure it holds up in court. Both parties should seek independent legal counsel to ensure fairness and adequate coverage of their interests.
Age isn’t quite what it used to be.
60 is the new 50, 80 is the new 70. There’s been a considerable amount of talk in the media about “miracle” technological advances that cure all types of ailments and promise to keep us alive well into the triple digits.
There’s no doubt that some of these advances are real and are actually extending and improving our lives, but there’s one thing they’ll never be able to change: accidents still happen, especially as we age.
According to a report by the Canadian Medical Association, nearly three-quarters of Canadians over 65 have at least one chronic health condition, and unexpected accidents like falls remain a leading cause of hospitalizations for people over 60.
Despite these staggering statistics, many people remain unprepared to deal with what could happen to them and their families if they suddenly become incapacitated by an accident or illness, or when they die.
Recent polls show that the majority of Canadian adults lack basic estate documents such as wills, representation agreements, or powers of attorney. And, many of those who have them need to update their documents for them to remain legally binding.
As you get older, not thinking about the very real possibility that something could happen to you means you are putting an unfair burden on your family and leaving them exposed to a number of headaches and responsibilities.
So what can you do to remedy that? Here are five things you can do right now to protect your family as you age.
Wills are extremely important documents. If you don’t have one (or if things have changed since you wrote it or you’re not sure what’s in it or where it is) you should definitely consider getting one (or a new one) as soon as possible.
Wills allow you to express how you want your estate to be divided and help keep an inventory of what you own. This provides a HUGE help for your family and takes the burden of many decisions off of their shoulders.
Perhaps more importantly, wills allow you to select someone you trust to be in charge of executing your wishes. This helps guarantee that your wishes are actually carried out after you die, and helps organize the division of your stuff once you are gone.
Power of attorney documents allow you to authorize someone else to sign financial or legal documents and act on your behalf. This can also be used to buy and sell assets, and sign tax returns if you are unavailable or incapacitated.
There are two types of power of attorney. While a specific power of attorney is limited to a single transaction, an enduring general power of attorney allows you to choose someone who will take control of all your legal and financial matters if something were to happen to you.
In addition to this, it is a smart thing to do if you are in the early stages of Alzheimer’s, other forms of dementia, or degenerative diseases and believe that you may need help managing your daily finances now or in the future.
One small note, a power of attorney doesn’t apply to health care decisions (you’ll need a Representation Agreement for that).
Representation Agreements are legal documents that allow a person (or a group of people) to make personal care and health decisions on your behalf.
This allows someone you trust to manage your affairs if you are incapacitated or unable to make your own decisions due to illness, injury, or disability. It also allows you to dictate your specific wishes regarding your physical, emotional and personal needs, including:
Without a Representation Agreement, a doctor or health care provider will choose your Temporary Substitute Decision Maker (TSDM) if you can’t make your own decisions.
This person is selected based on the Health Care Consent Act. Your spouse would be the first choice, followed by one of your children.
Your TSDM is required by law to make decisions based on your best interests. However, this person may not necessarily be the person you want, or may not know what type of care or treatment you would prefer.
A Representation Agreement allows you to choose in advance who you want to represent you. Most people choose a spouse, partner, friend or family member in their representation agreement.
The representative’s main responsibility is to assist a person to make a decision for themselves. This means that before making any decision, the representative is legally obligated to try to determine your current wishes.
If you are completely incapacitated and your current wishes cannot be determined, then your representative will follow what has been outlined in your Representation Agreement.
As a last resort, the representative will make a decision based on what they think is in your best interest while consistent with your values.
Most people tend to accumulate lots of things throughout their lives. While some of these things may hold sentimental value, they also tend to pile up in basements, attics, and closets and are a hassle to deal with as we get older (not to mention a nightmare for those left to do it after you pass).
Downsizing isn’t as easy as “just getting rid of some stuff”. Letting go of your things can be difficult, but it can also be a very liberating process and one that your family (and future you!) will definitely appreciate.
Going over your things with your family members (especially your kids) is a great way to get the ball rolling on downsizing.
According to the BC Wills, Estates and Succession Act and the BC Wills Variation Act, which legislate estate succession in British Columbia, there are a number of reasons why your estate documents may be deemed invalid by a court.
For example, there could be undo interference (which is when someone influences the writing of another person’s will); formal invalidity (when proper processes aren’t followed); or a lack of testamentary capacity (when someone doesn’t have the mental capacity to legally sign a will).
Regardless of the reason, if a judge declares that a will is invalid, it’s essentially thrown away.
Draftinging or reviewing your documents with a BC Notary can help to ensure your wishes are followed and documents stand up to scrutiny.
The bottom line: if you haven’t created or reviewed your legal documents lately, now is the perfect time!
David Watts is a BC Notary who has practiced in Downtown Vancouver since 2006. David’s office specializes in working with people to create their Wills, Power of Attorney and Representation Agreements; as well as performing Real Estate Transfers for properties all around British Columbia. David has trained to receive the Certified Professional Consultant on Aging (CPCA) designation. David has been long-serving Director of the Society of Notaries Public of British Columbia and is currently 2nd Vice President.
We are excited to announce that BlueShore Financial is now working with David Watts Notary as a mortgage lender.
It’s an exciting week for BlueShore Financial as they open their new downtown Vancouver branch, just a few blocks from our office.
What we love about BlueShore is they aren’t your average financial institution – they think differently. One example of this is they have built a unique Financial Spa® which designed to create a calming and relaxing environment. Their branch has soothing sounds of their waterfall, soft lighting, comfortable seating and refreshments. They even sell spa products such as lotions and soaps with proceeds going to BC Children’s hospital.
You can take a virtual tour of their Financial Spa® here.
We also love that they are a Vancouver-based credit union who donates 1% of their pre-tax profits to local charities and not-for-profits in the local community. Wishbank, one of their impressive programs is a financial literacy program for kids delivered in local schools.
BlueShore Financial will be working with us to provide mortgage solutions. Some features of their mortgages include:
If you are interested in finding out more, phone or email, we’ll be happy to discuss.
Buying a new home can be one of the most exciting times of your life, but it can also be rather stressful.
Not only does it mean making a huge financial investment, but it also requires that you make a number of decisions that will impact your life for years to come. This is especially true in Vancouver, where a red hot market, enhanced mortgage rules and new government regulations add extra pressure to the process of purchasing a home.
In this context, understanding the buying process and learning from people who have previously purchased properties in the city are great ways to make the process of buying a house a little bit easier.
That’s why we’ve put together a list to help you avoid making common mistakes when the time comes to buy a new place.
Many people start their search for a new home by going onto the Internet, visiting their bank’s website, and using a basic calculator to get an estimate of their mortgage.
We highly recommend that you do not do this.
There tends to be a pretty big difference between what the calculator tells you your mortgage will be and what it ends up being in reality.
That’s why we believe that it’s critical to have your loan pre-approved (not just pre-qualified) before you even start searching for a home. This will give you a better idea of how much house you can actually afford, whilst also showing sellers and real-estate agents that you’re serious about purchasing.
In your urge to start seeing new homes, you may be tempted to accept the first mortgage offered to you–but this is probably not a good idea.
Before you start looking at homes, it’s critical that you actually get a mortgage plan that is right for you. While doing this isn’t easy, it will help guarantee that you are purchasing a home that’s really within your means, which is crucial for long-term financial stability.
That’s why we recommend that you shop around before settling on a mortgage. Try out a few different banks; or better yet, hire a mortgage broker that will help you figure out how much you can truly afford, determine what the best mortgage product is for you, and compare options that help you save money.
Many home buyers make the mistake of trying to fly solo when looking to purchase a home.
While they may have read some articles and done good research about the home purchasing process, they are in no way qualified to do this on their own.
That’s why we always recommend that buyers hire a real estate agent to help them throughout the purchasing process. Real estate agents will help you find homes that are within your means, negotiate contracts, and provide support every step of the way.
That’s why it’s critical to find a real estate agent that can help you make a smart purchase.
Wondering how to find a real estate agent that will help you purchase your next home? Make sure you read our post on choosing the right real estate agent for you.
One big mistake home buyers make — especially those flying solo — is buying properties out of desperation.
These people tend to buy something that’s barely “good enough” for them, rather than something that really suits their needs, just because they’re sick of the emotional rollercoaster of searching for homes.
While this may seem tempting at the time, it is a terrible idea. Remember, you’ll probably be at your new home for several years so it’s important that you purchase something that will make you happy.
Rather than buying out of frustration, stop looking for a while, or heed our advice and hire a real estate agent that can help you look for properties that tick the boxes you are looking for.
Not budgeting properly for closing costs is one of the most common mistakes buyers make when purchasing property in Vancouver.
Whether you’re a first time homebuyer or an experienced purchaser, you need to learn about closing costs–and budget for them properly. Not doing this can land you in a heap of financial trouble and can put the approval of your mortgage at risk.
A few months back I put together a comprehensive guide on closing costs for first time buyers. I highly recommend that all buyers take a look at it. The guide provides great detail about the following closing costs:
Avoid common mistakes by getting help from a Notary Public
BC Notaries provide conveyancing and other legal services on more than half of all real estate transactions in B.C. and are highly trained and experienced in both simple and complex real estate transactions.
By giving you professional legal guidance on the purchase of a home, notaries will help you navigate through this often daunting process and help make it much easier for all buyers.
Want to know more? Get in touch now.
People who know me know I’m not a DIY fan.
It’s empowering to do something yourself. There is a satisfying sense of accomplishment that comes with the successful completion of a project. I also love cutting costs by doing things on my own, and often learn new skills in the process.
But even an avid DIY fan like me knows that there are some things that I simply can’t do by myself. I also know the value of working with a professional.
Some of them are obvious. Like open-heart surgery or building an aircraft.
But others aren’t so straightforward, like legal documents. Even as an experienced BC Notary, I know there are certain legal documents that I can’t prepare on my own. I accept that and defer to other experts when I need these documents.
This is why I’m concerned about a growing trend: people wanting to DIY their Wills (often using the internet as their only source of information).
Don’t get me wrong, I understand the appeal: cutting costs, avoiding the hassle of having to see a professional, the satisfaction of learning a new skill. These reasons are valid, but trust me when I say, it’s just not worth it.
In the best of cases, DIY Wills are often ineffective, and seriously hinder the chances that your wishes are followed.
In the worst of cases, they are deemed invalid by the courts and leave your loved ones scrambling to figure out what to do with your estate.
The final decision to DYI your Will is yours to make, but at least you won’t be able to say that I didn’t warn you…
In B.C. and in many other jurisdictions across Canada and the United States, certain formal elements must be in place in order for a will to be valid. If the procedures aren’t followed correctly, then the whole will is deemed invalid.
There are legalities to consider, and you’ll need to make some difficult decisions about the future of your estate. It’s advisable to have an expert that can help you understand the legal consequences of your decisions.
Executors play a central role in the administration of a will. Without good executors, the final division of your estate can cause huge headaches to everyone involved. Guardians take care of our Children should we not be there. Should they be the same person? Do you know why it’s good for them to be different people? Have you thought about checks and balances?
DIY-ing your Will may lead you to make bad or inappropriate choices about executors and guardians.
Many people forget that taxation plays a central role in estate planning and wills drafting. When a BC Notary drafts a will, they can tell you what type of taxes a person will have to pay in estate and transfer taxes, giving you the information to adequately divide your estate.
Without understanding how taxes work and what role they plan in estate transfers, there’s a chance you may be burdening your loved ones with heavy taxes.
In general, DIY legal service providers create one will template, but not everybody’s situation is the same. BC Notaries create a will to meet your estate needs, personalizing your will so that it is both valid and effective.
Whenever you write a Will with the assistance of a legal professional, you are walked through a series of questions that help you account for the totality of your estate.
Only once your estate is properly assessed, will a Will be drafted to divide your estate as you see fit. DIY-ing you Will may cause your assets to be divided differently then you wished because they are not properly accounted for.
The whole point of making a Will in the first place is to decide what you want to do with your estate. Whether it’s big or small, your estate comprises of the fortune that you were able to build over your lifetime.
DIY legal service sites can make it sounds like creating a Will is simple. But it isn’t. And mistakes cost money. In fact, ineffective wills can end up costing your family thousands of dollars in legal fees down the road. That can mean that your fortune — big or small — can end up going to covering those fees rather than to your loved ones.
No matter how much research you do, you probably don’t speak legalize, (which is how I call the oh-so-complicated language of the law). So even though you (and other normal humans) think that your Will is clear, without proper training, there’s a good chance that your wishes may not be clear for the law.
If this happens a court case is required to determine the correct meaning of the Will, costing your family their precious money and time.
One of the big benefits of working with a BC Notary is that you get to discuss your estate plan, ask questions, and get advice about the best way to structure things.
Our experience makes the process much easier to work through. Common feedback we hear is that “that was much easier than I expected”. We also hear that “I feel like a heavy load has been lifted from me”.
Let us do the heavy lifting. You’ll feel better having these important details sorted out.
BC Notaries can help with Wills, but we also prepare and advise on Powers of Attorney and Representation Agreements.
For a complete estate plan and to provide full protection; it’s important to discuss if a Power of Attorney and/or Representation Agreement is something you can consider and learn about when working with a professional as opposed to a DIY wills kit.
At David Watts, Notary Public, we can help you write your Will.
We have more than a decade of experience helping people with their estate planning and can give you the advice you need to write a valid and effective Will.
Get in touch and we’ll make sure your Will reflects your wishes.
A notary public (also known as a notary), is a trained professional who can provide limited legal services to the public.
Notaries have been around for a long time. Babylonian notaries chiselled the oldest written law into stone over 4000 years ago. At that time, notaries were wise and trusted members of society. Their role was to oversee transactions and guarantee their fairness.
The role has since evolved into a professional service, but its essence is still the same. Notaries still guarantee the fairness and legality of transactions.
There are a number of scenarios in which you should consider hiring a notary. These include:
Many people think that they should hire a lawyer to do these things. I’ve written about the difference between lawyers and notaries in the past, but here’s what you need to know in a nutshell:
BC Notaries are experts in the areas we choose to practice.
If we act for you in a residential real estate transaction, for example; our experience will help us to identify issues and deal with them before they become problems.
If we do get to a place where litigation is necessary, we have a network of trusted referral partners and we will find a lawyer who’s an expert at litigation.
BC Notaries have professional standards dictated by the Notaries Act of BC. They also are governed by the rules, by-laws and best practices dictated by The Society of Notaries Public of British Columbia.
That means that at David Watts Notary Public we are certified experts, and can help you with all your notary needs.
We help you complete you with Purchases, Sales, Mortgages and Family Transfers.
Prepare for the future with Wills, Powers of Attorney, and Representation Agreements.
General Notarizations and Certified True Copies of Original Documents as well as Notarize your signature on:
Get Documents authenticated and legalized for use in Canada and around the world.
To find out more including information about our processes and receiving a quote please call or email us. We are happy to assist you directly or to provide a referral for someone who can help.
Every year Vancourites vote in the Georgia Straight’s Best of Vancouver. Getting to the top is no easy feat – there are so many great businesses servicing the community!
This year we received first place as the “Best Notary”. Previously, our category was called: “Best Lawyer/Notary When Buying/Selling Real Estate”. This is our ninth win!
A big thank you to all of our amazing clients and referral partners, we couldn’t do it without you.
We are fortunate to have an incredible team working behind the scenes to make the magic happen. Read on to find out what they love about their work and as they share their own Best of Vancouver.
What I love about my work:
I love making a difference for people. Sometimes it’s the opportunity to go the extra mile and help people get their real estate transaction done despite challenging circumstances and tight timelines. This is where our office really shines and I’m always happy to hear from clients how one of our team has helped them or done some excellent work.
I also really like sitting down with people to help with their Wills. It’s a chance to get to know my clients and help provide comfort around recording their wishes with their planning documents. Wills Clients often say that the process was much easier than they expected and that they feel like a large burden has been lifted. I love it when people tell me how they feel after they’ve worked with us; it’s always very satisfying.
My favourite thing about Vancouver:
What I like most about Vancouver is the proximity to a variety of outdoor activities. I love being outside. Vancouver has hiking opportunities, great beaches, golf courses, amazing skiing fairly close by at Whistler; trails around Burrard Inlet and False Creeks. There so much to do; you can find something outside almost always.
It doesn’t hurt if you have good rain gear this time of year!
What I love about my work:
Being able to assist the community with legal services that allow them to move forward in life. Whether it’s allowing a minor to travel with a parent to another country through a notarized consent form or assisting first time home buyers in purchasing their first home, the reward comes with the satisfaction of knowing that each person was able to make a positive step in their life through our services.
My favourite thing about Vancouver:
The ability to obtain virtually any type of food you want. Vancouver holds some of the most amazing world cuisines and having it close by brings so many options and opportunities to always be trying something new.
What I love about my work:
Helping clients to complete their real estate transactions and hearing back their excitement and a massive smile :).
I always feel happy and supported working with our team. When there’s a huge challenge, we are always here for each other and we fix the issues together.
I also love the degree of control and flexibility with my job. If needed, I am able to make perfect arrangements with our team to accommodate any circumstance.
My favourite thing about Vancouver:
The food! We have so much variety.
Besides trying out new foods, I love to walk my dog, Milo, in the parks, exploring new trials, and meeting new furry friends in my days off!
What I love about my work:
99% of the time, I bring good news to people – the emotional reward from clients makes me feel happy to work.
Our system is really well designed and I love to complete my work in an effective and efficient system – I get a sense of satisfaction regarding my everyday tasks.
I love our team. There’s no stress working together, everyone supports each other and we face problems as a team. Everyone is willing to help each other.
My favourite thing about Vancouver:
The top of Blackcomb Mountain during winter and Rivendell Retreat Centre in Bowen Island. I love to ski, hike, swim and eat with my family.
What I love about my work:
The legal profession offers people the opportunity to continually learn. I like working hard and developing a skill until I am good enough to help others benefit from it.
My favourite thing about Vancouver:
One place I really enjoyed this summer was the Steveston Country Farms. I went just before the beginning of fall and all the cute farm animals really put me in an autumn mood. If you go, grab some of their fresh produce before winter comes and they close for the year.
What I love about my work:
I love how everyone in our office works to the best of our abilities and genuinely care about the people we work with.
My favourite thing about Vancouver:
I love hiking our mountains and running our trails… give Golden Ears and Burnaby Lake a shot.
We are grateful that we earned the appreciation of our clients, peers, and friends to win again this year.
Are you getting ready to buy your first home?
While it’s a big task, when you are arm yourself with the right information, you can avoid setbacks that complicate the purchasing process.
Most of these items can easily be avoided if buyers have access to proper information. That’s why, if you’re looking to buy your first home in Vancouver or the surrounding area; here’s a guide to help you navigate through this complicated (and often daunting) process.
Before you even start thinking about purchasing a home, there are a few things that you must consider.
The health of your credit score will dictate whether or not you can secure a loan, how much you can borrow and what interest rate you will get so it’s helpful to find out in advance where you are and what you can do to improve it.
Every lender has their own criteria, however, most consider a score of 650 and above low risk.
According to Mogo, your scores are calculated by:
35% payment history – whether or not you make your payments on time.
30% utilization ratio – they recommend staying before 35% of your total available credit and never going above 70%.
15% length of credit – the longer you have accounts open, the more history it shows of you being responsible with credit.
10% types of credit – have a mix of high risk credit such as credit cards and lines of credit, and low risk personal loans.
10% inquiries – hard credit checks occur when you are applying for new credit, phones and even bank accounts. Too many can affect your credit rating.
Both Equifax and Transunion will give you a free report each year – go here for full instructions. Services such as Mogo and Credit Karma will give you free monthly updates without making formal credit checks that affect your scores.
Make sure to check your credit reports for any errors and look for ways you can improve your credit score by:
Given the high prices of real-estate in Vancouver and its surrounding areas, a downpayment for a house or a condo may be a significant amount of money.
You will be required to have at least 5% for a down payment to get a mortgage with default insurance; or at least 20% for a mortgage without default insurance.
You’ll also need to prove to your lender that you can cover your closing costs on top of your down payment.
Closing costs may include:
For full details check out our article The First Homebuyer’s Guide to Closing Costs in Vancouver.
You should also factor in moving costs, home insurance and anything you might have to spend as soon as you move into your property.
There are a number of different ways to get a mortgage, the most popular being banks, credit unions, and mortgage brokers.
Each will have different terms, conditions, and interest rates.
Working with a mortgage broker will give you access to a wider range of mortgages and lenders than working with a solo lender such as your bank.
Every mortgage broker will have relationships with different lenders, so ask them who they work with.
Mortgage brokers charge the lender a commission so you don’t have to pay any additional out of pocket fees with institutional mortgages. There may be additional fees with private mortgages.
To make sure you find the right Mortgage broker, check out our guide on How to Choose the Right Mortgage Broker.
Getting pre-approval doesn’t mean you are guaranteed to get a mortgage, or the amount that you’ve pre-approved for. It means the lender has assessed your financial situation and determined the maximum amount they will lend you and the interest rate they will apply.
Pre-approval allows you to begin looking at homes knowing your price range while understanding your mortgage payments.
Once you have found a home, the approved mortgage amount will depend on the value of the home and percentage of your down payment.
To get pre-approval you’ll need to provide:
The lender will determine how much they are prepared to lend you based on your credit rating, income, and debts.
Before signing on the dotted line for a mortgage, make sure that you understand all of the fees associated with your mortgage. One important fee to understand are the penalties you will have to pay if you decide to sell your home and prepay your mortgage.
For more information, check out our article What Are Mortgage Penalties? (And How to Avoid Paying Them)
First time home buyers in British Columbia may qualify for the First Time Home Buyers’ Program.
This program is run by the provincial government, and reduces or eliminates the amount of property transfer tax you pay when you purchase your first home.
In B.C., the Property Transfer Tax (PTT) is a tax of 1% on the first $200,000 and 2% of the remaining value of the purchase price to $2,000,000.
This can add up to a significant amount of number, which means that you should definitely check to see if you can be exempt from paying this tax.
You don’t NEED a real estate agent to buy a home, but you should consider getting one.
A real estate agent will be able to guide you through the process of searching for and purchasing a house. These professionals are knowledgeable about the market, and have helped close deals in the past. They will make your life easier throughout your purchase.
Because you will be working closely with your real estate agent, it is recommended that you hire someone you trust. Shop around, make some calls, and find someone who you’ll be comfortable working with.
To make sure you find the right Real Estate Agent, check out our Guide How to Pick the Right Real Estate Agent.
Then, put them to work helping you find a house.
Remember the pre-approval is the maximum your lender will MAY give you. It makes sense to look for properties below the maximum.
Once you have an agent working with you, your mortgage has been pre-approved, and you’ve figured out how much you can spend on a down payment, you’re ready to start looking for a house.
This next phase is complicated and time consuming, and requires you to do a number of things. Here are just a few:
Finding the right house takes time and effort, and a healthy amount of patience.
That’s why, if you’re serious about finding a home, you should place the search high on your list of priorities.
This will inevitably mean making some sacrifices.
You’ll probably be seeing many houses and going into many meetings, so keep that in mind when making plans.
Prioritizing the search also means avoiding large expenses (such as buying a car). Doing this will have an impact on your financial situation, and may mean that your mortgage pre-approval is revoked.
Perhaps one of the most important things that first time buyers need to know is that they probably won’t be buying their dream home.
And that’s ok.
Being open to new plans and flexible about your wishes is key to successfully buying your first home.
Maybe the house you find is great but isn’t in the area you wanted. Maybe the location is ideal, but you need to invest in changing wallpaper and cupboards. Maybe the yard is a bit smaller than you wished.
The perfect home possibly doesn’t exist (or is out of your price range) and that is just a reality that everyone has to deal with.
As long as you have an open mind about your first home, you’ll be fine. And remember: this home will probably not be your forever home, which means that you’ll most likely be able to upgrade down the road.
When selling a home, people often bring in Stagers and do minor facelifts to make the house look its best. This can mean a room might look bigger than it is, or that you don’t notice something.
When you start seriously considering a property, make sure you measure rooms and look closely at what might be hiding behind a coat of paint.
Once you’ve found a home you like and made sure it fits your budget, it’s time to make an offer.
Making an offer requires that you sit down with your real estate agent (and perhaps a notary public or lawyer) to draw up an offer that incorporates the right amount of “subjects”.
These “subjects” are conditions that protect your purchase. For instance, the offer can include a subject that specifies that unless a fix is made, the offer will be rendered void.
It should also include a subject to inspection condition. This will allow you to get a third party professional to check the house for any serious issues that the untrained eye would miss. Doing so can save you a lot of money in the long run.
If you are getting a mortgage, it should definitely include also include a subject to a financing condition. Your lender may have approved your for financing, but not like that building. Make sure the lender approves the property as well as you.
If buying a house or detached property, I always recommend you make sure you can get insurance on that property. Sometimes there are things like older aluminum wiring that can make it difficult. Your lender will require you have insurance before they advance funds; so make sure you can get insurance before you remove subjects are you are obligated to complete.
If the seller approves your offer, you must go back to your bank (or mortgage broker) and finish the loan approval process. As long as your financial situation has not changed since getting pre-approval, this should not be a difficult process.
Once your financing has been approved, it’s time to do a final inspection.
This will cost around $500 (or more) and may take a while to do, so book it in as soon as you put your offer in.
Inspection is just one of the many closing costs you’ll have to incur.
Unfortunately, these costs will add up, and many people don’t know they exist. That’s why it’s important to review them beforehand.
In general, you should keep in mind that these costs could add up to nearly 4% of the final purchasing price.
For more information about Closing Costs, check out our Guide The First Time Homebuyer’s Guide to Real Estate Purchase Closing Costs In Vancouver.
At this point, you should know exactly how much money you’ll need for your BC Notary or Lawyer to complete the transaction. They will let you know what the best way to make this payment is, and will advise you on what you need to bring to the signing.
During this part of the process, you’ll have to go through a lot of paperwork. You’ll also potentially have to go back to the bank to make sure all mortgage details are finalized.
This part of the process may be tedious, but once it’s done, you’ll be the proud owner of your first home!
Now that you know the steps involved in purchasing a home, there are a few things you can do right now to get the ball rolling.
1. Find out how much you can borrow. Doing this will give you a clearer picture of how you’ll be able to pay for your new home.
2. Get advice from a BC Notary. Notaries provide professional legal guidance on the purchase or sale of a home and can help you navigate through the legal part of purchasing a home.
Want to know more? Get in touch now.
We’ve created this handy infographic that covers the stages a first home buyer will need to go through to buy a house.
For a more detailed explanation, see this post.
If you find this infographic helpful, you can use it on your site. See below for full permission details.
Finding a Realtor is almost like finding a partner—you may need to go on a few dates before finding the one.
Like in dating, it’s important to know what you’re looking for in a Realtor. There’s a lot riding on your relationship with this person, you don’t want to invest time and energy in someone you won’t be able to trust.
Regardless of whether you’re looking to buy or sell a property, finding the right Realtor can make a huge difference on your happiness and your finances.
A Real Estate Salesperson, also known as Real Estate Agent or Realtor is a licensed professional who assist people in the buying and selling of properties.
In British Columbia, these professionals are regulated by the Real Estate Council of B.C., an organization that licenses and trains Realtors.
There are plenty of licensed professionals in the province, but not all of them are good.
Here are traits that you should look for in a Realtor:
British Columbia’s real estate market is saturated with Realtors.
According to the Real Estate Council of B.C., in 2016 there were 23,366 licensed Realtors in the province. This adds up to nearly 1 Realtor every 200 people.
Why should you care about this?
Because it means that Realtors are in intense competition with each other, making BC a buyer’s market when it comes to hiring Realtors.
This means that you have the upper hand when it comes to choosing a Realtor. Much like if you were hiring any other employee, it’s important that you know exactly who you are hiring.
That’s why, if you want to pick the right Realtor for you, you should do the following things…
Make a list of the Realtors you may know, you find and are referred to you. If you have colleagues or friends who have bought a home recently; ask how they liked working with their Realtor and who they were.
Ask your BC Notary, lawyer or mortgage broker for a referral for people they have worked with. They should be able to tell you fairly quickly who they know, like and trust.
You can also search online to find Realtors in your area. Be aware however that just because someone is good at being found online, doesn’t necessarily mean that they are a good Realtor.
We know a number of Realtors and would be happy to provide some names to help you find the right fit. Before you start talking to potential Realtors, it’s important that you do some preliminary research.
Search online. A quick Google search will give you the names of Realtors in your neighbourhood. More popular Realtors may even have reviews posted online. Read these reviews and come up with a list of six or seven Realtors in your area that may look promising.
Talk to you neighbours, friends & colleagues. Once you’ve created a shortlist of potential Realtors, talk to people you know. Ask your neighbours if they have worked with anyone on your list, and see if they have anyone else to recommend. If someone has had anything less than a good experience with a Realtor, immediately cross them off the list.
Reach out to the Realtors. Once you have a set list of potential Realtors, it’s time to contact them. See what kind of vibe you get and ask for references from previous clients. If you get a good vibe, keep them on the list, if you don’t cross them off.
Whether you are selling or buying, it’s important to always interview at least three Realtors.
These interviews may seem intimidating at first, but remember. You are in control. They have to impress you, not the other way around.
These interviews are important to figure out if the Realtor has the perfect balance between credentials and chemistry. You also need to absolutely trust your Realtor.
During each interview, make sure you ask yourself if this is a person you like and trust–and don’t forget to ask them the following five questions…
Experts recommend that you stick to Realtors who work within a 15 kilometre radius of the listed home. This ensures that they know the area and the market well.
Figuring out how many listings a Realtor has will give you an idea of the kind of attention you’ll get from them.
A Realtor with too many listings will be stretched too thin. This means that they may not be able to help you when you need. At the same time, too few listings may be a sign that there’s something wrong with that person.
What’s the magical number then?
It’s hard to say, but experts suggest that anywhere between 10 and 15 listings will allow your Realtor to pay attention to you.
There’s nothing wrong with hiring a Realtor that has a lot of listings. In fact, sometimes it’s good to get high-profile Realtors that can help sell a property with their own name.
If that’s the case, it’s often likely that the Realtor will not be handling your listing personally.
Some people are often caught off guard when they hire a Realtor but instead end up working with a member of their team. Some Realtor teams have designated individuals for working with buyers and some sellers; you get benefits of the knowledge of the team and individual attention of the team member specializing in what you need.
Make sure you know if the Realtor will be handling your listing personally or relying on team members.
It’s important that you know exactly how much you’ll be paying a Realtor prior to hiring their services. Most often in British Columbia, the Seller pays the Realtor’s commission.
Here are a few questions you should definitely ask potential Realtors before you hire them.
Figuring these things out will help add to your understanding of the process and choose the right real estate for you.
Good Realtors will have a strategy to help you buy or sell a property before meeting with you. Great Realtors are able to explain this strategy to perfection.
When you’re interviewing potential Realtors, make sure to ask them about strategy, and see what they bring to the table.
In the end, you’ll want to choose someone who is prepared and knows exactly what they need to do to help you; and who you think you can trust.
Once you’ve selected an Realtor, its extremely important to maintain an ongoing review of your working relationship with them.
Sometimes Realtors put in a lot of work initially, but their efforts peter out over time.
Being open about any problems or issues you are facing is crucial to building a successful working relationship with your Realtor.
By reviewing the relationship, you stop your time and energy being wasted with someone who isn’t right for you, allowing you to find the right Realtor. If find out you are not happy after working with someone, you can find a new Realtor.
While relationships with Realtors can sour, following the steps outlined above steps and asking the right questions before you settle on an Realtor will give you a better chance to find The One in your first attempt!
If you have any questions, or would like a referral for a Realtor in your market; please email or phone me.