Mortgage 101 – Land Titles, Reverse Mortgages, and More | November 27, 2023

Live from CityNews, Clinton Wilkins and Todd Veinotte answer listener’s mortgage-related questions. They discuss the land title migration system in Nova Scotia, reverse mortgages for retirees, how seniors can leverage home equity lines of credit, and mortgage options for first-time home buyers.

Todd Veinotte 00:00
I thought Dan Lomas was very informative.

Clinton Wilkins 00:07
Yeah. I love bringing on guests. And I think, you know, we’ve talked about this before that it just brings such a great value to our show, bringing a different perspective. And you know, what, every time we bring a guest on, I learned something. And, you know, I’m interested. And I think when we’re doing things like financial literacy month, it’s all about education. I think bringing in some different perspective is awesome.

Todd Veinotte 00:27
Absolutely. Alright, listen, you can give us a call if you’d like to talk to Clinton about mortgage related questions. Lots of concerns out there about interest rates, about variables about renewals, whatever it might be. 902-405-6000. And so let’s talk to Mike. Hello, Mike.

Mike 00:44
How you doing Todd?

Todd Veinotte 00:45
Well, you?

Mike 00:47
I’m not too bad. Hi Clinton.

Clinton Wilkins 00:48
How you doing?

Land title migration process in NS

Mike 00:49
Good, good. The question is, I’m not sure if this one that relates to mortgages, but land migration, I have a question on that.

Clinton Wilkins 00:58
Sure. You can hit me and I’ll see if I can answer it or not. If not, I’ll take the question away and get back to you.

Mike 01:04
Yeah, okay. I had it done. Years ago, I don’t remember exactly when it was. The question I guess is do you every time or just the one time you have to do it? Or do you have to do it every time you move? Or how does it work? Or what can you send me on information on stuff like that?

Clinton Wilkins 01:23
Yeah, for sure. So that’s actually a pretty straightforward one. Migration started in Nova Scotia sometime around the year 2000. And once the property is migrated, it’s on the new land title system. So once it’s migrated, once you’re good to go. That property never needs to be migrated again. So hopefully that answers your question.

Mike 01:44
Yes, it does. I probably, I probably asked that question when I had it done. I don’t remember the answer. But yeah, good. That’s what I was asking yeah.

Clinton Wilkins 01:51
It’s a question that I’ve had before because I think sometimes people think every time you do a transaction, you need to migrate it. But once it’s on the new system, you’re good to go. Never needs to be migrated again. And you actually have to do a migration, if you’re going to register a new mortgage, or if you’re going to sell the property. So oftentimes, that happens, especially for people that have owned their home for, you know, more than I guess, 25 years, it might still be on the old system, especially if they haven’t registered a new mortgage, or if they haven’t sold the property. So there’s very few properties in Nova Scotia that still need to be migrated. When I first started doing this 17 years ago, we were doing migrations all the time. And we’re actually going to be bringing on a guest here at the end of the month from first Canadian title. And we’ll talk a little bit more about migrations on the 30th. So we’ll we’ll have her on. And she can answer some more technical questions as well.

Mike 02:41
Yeah. Did you say I once you sell you have to do it again? Is that what you said?

Clinton Wilkins 02:46
No, if it’s on the old system, and you’re going to sell the property, it needs to be migrated before you sell it.

Mike 02:52
On the old system, okay, how old are you talking about there?

Clinton Wilkins 02:55
So like prior to the year 2000, they would have been on the old system. But if it’s been migrated, you’re good to go. You can mortgage it, or you can sell it and nothing needs to happen. And that’s really something that the lawyer would look into before you do a transaction. I can see myself because I have access to the land title system, I can see if it’s been migrated or not. And I can tell you, there’s very few properties that we’re doing transactions on here that need a migration. I see maybe only a handful a year, right now. But 17 years ago, we saw a lot just because it was very early days on the new system.

Mike 03:37
Yeah, so any chance do you happen to know how much it cost these days?

Clinton Wilkins 03:40
Well, it depends. I think if you do it through a lawyer, sometimes that can be more costly. If you’re going to do it alongside doing a mortgage transaction. Sometimes we can do that as like a bundled deal with the registration of the new mortgage. So it just depends on the type of transaction that you’re you’re doing. I would venture to say with a lawyer, you’d be somewhere around like $1,000 to $2,000 just depending on what the complexity is. But certainly I think if you’re going to go do the migration as a one off, you’d want to go speak to a lawyer that really specializes in land titles, and get a price from them.

Mike 04:17
Right on okay thanks, man.

Clinton Wilkins 04:18
Thanks. Thanks for calling.

Todd Veinotte 04:20
Take care. If you’ve got a mortgage related question just like that one, give us a call 902-405-6000. I can assure you there’s nobody in the business that knows the business like Clinton Wilkins. So if you’ve got a renewal coming up, or you’re not quite sure what to do, if you want to get a five year fixed, or a variable or all of these questions that a lot of people have, now’s a good opportunity to get some advice from Clinton 902-405-6000. Raph. Hello.

Reverse mortgages for retirees

Raph 04:50
Yeah, I’m just I just had a question about, I’m retired. I want my own home. I have a month tension. I’m just I’d like to ask a question about reverse mortgages, how they work, how it works, and whether it’s a smart investment, like not investment, but

Clinton Wilkins 05:08
a smart product, I guess.

Raph 05:09
Yeah, like, as part of a retirement, I mean, I have I have money in RRSPs, and so I’m fairly comfortable, but like, I want to put heat pumps in here. And it’s, like 20 grand, I don’t have $20,000 laying around. Now, I could go to the bank, and borrow $20,000.

Clinton Wilkins 05:26
So there’s, there’s two, yeah, there’s two schools of thought. I think reverse mortgages are right for a lot of retired people. And the way that a reverse mortgage works, it’s your age, is really the biggest factor of how much you can borrow. Obviously, the older you are, the more you can borrow. And the way the reverse mortgages work, typically, is there’s no payment, the payment basically capitalizes every month, and there is, you know, clause within the mortgage that you can stay in the home for as long as you’re living. If you were to leave the home and go to like a seniors home, or if you were to pass away, at that point, then that mortgage would need to be paid out either by the estate, or that home would need to be sold. Reverse mortgages, I really think are right for people, retirees, and seniors that have very low incomes, because those people can’t afford to take a mortgage, and they can’t really afford to take a home equity line of credit. But I do see people that are retired, that, you know, maybe could handle an interest only payment. And sometimes in those cases, we will do a home equity line of credit. We can always finance that home equity line up to 65% of that home value contingent on that retirees income. And you know, different people have, you know, different situations. So I think it’s going to be a one off for your situation specifically. And maybe a reverse mortgage is right for you. But maybe more of a home equity line of credit would be right. So I certainly would recommend you seeking the advice of an unbiased mortgage professional about your situation specifically.

Raph 07:00
I do have an advisor, like, at the bank and CIBC Wood Gundy, they, you know, they do investments and such. So there’s no actual interest on the loan?

Clinton Wilkins 07:10
Right? Yeah, because I’m thinking, if you were ever saved $200,000 on a loan, and you’re in the home for another 20 years, by the time you pay that back and might be another $100,000.

Leveraging home equity for seniors

Clinton Wilkins 07:10
There is interest, but that’s capitalized every month. So basically, whatever you borrow, every month that goes by, it will be then capitalized on that mortgage. Yeah, reverse mortgages work kind of two different ways. One, you can either take a lump sum, kind of when that funds, but there’s another way that the reverse mortgages work, and it can almost be supplementing your income. So maybe you can take the lump sum, but then you can also get a lump every month. And every month that goes by the amount that you owe, basically goes up. The downside on the reverse mortgages, typically, those interest rates are higher than the rates that we can get from a bank.

Clinton Wilkins 07:29
It could be more depending on what happens with the interest rates. But I think the beauty of this product is a lot of seniors can’t handle a mortgage payment on a $200,000 mortgage, nor could they even qualify. So like what we said with our previous guest, the home in many cases is the biggest asset, especially for a retired person. Depending on you know, what your net worth is outside of your home, leveraging the home up can be a great way of either keeping people in the home, or supplementing the income. So, you know, I think it’s a conversation that we’re having more and more everyday with seniors. And you’re certainly not alone. We’re having these conversations all the time.

Todd Veinotte 08:40
Okay, Raph, how’s that sound? Good?

Raph 08:42
Sounds good.

Todd Veinotte 08:43
Okay, great. Take care. 902-405-6000. Terry, hello.

Terry 08:47
Hey, how you doing?

Todd Veinotte 08:48
Well, you?

Mortgage options for first time home buyers

Terry 08:50
Very well, thanks. Clinton, and you two are doing a grand job at your weekly shows and so on. It’s a service needed, thank you. So Clinton I’m doing some mentoring with a young real estate person. And he’s just looking at a couple of ways to kind of get himself solidified, or you know, able to move forward. One of the things he’s thinking about right now is maybe he is looking for a fourplex. Live in one unit, and then rent the others. And that I mean, that could could possibly be rented when he buys it.

Clinton Wilkins 09:30
Yeah, I think that’s a great idea for especially for first time homebuyers and young people trying to get into the real estate market. I love it.

Terry 09:37
Great.

Clinton Wilkins 09:38
Yeah. I think that’s a great option. Sorry, go ahead.

Terry 09:39
Any little red flags? I mean he should just come talk to you number one.

Clinton Wilkins 09:45
Yeah, well, I think getting pre-approved is is key and the way that it works when you’re buying an owner occupied rental, if you buy a single family or like a two unit, we can qualify for someone with as little as 5% down. When you buy a three unit or a four unit and that four unit would be the max, it would be a minimum of 10%, down, and of the rent and those other three units, we can use 50% of that, to add to the gross income. So that can really help with qualifying sometimes, and as you know, with the purchase prices, you know, people need every little bit they can, they can get sometimes income wise just to get that mortgage approved. And we’re seeing a lot of younger people choosing to buy maybe a single family with an in-law suite, or a three or four unit, this is becoming more and more common. Especially kind of as the prices have increased. And as the interest rates have gone up too.

What value does unbiased mortgage professional provide?

Terry 10:36
Cool. So I mean, this may sound like a silly question, but why should he come see you? How can you help put things together for him?

Clinton Wilkins 10:44
Well, I think you’d like if you’re talking about someone who’s just entering into the real estate market, maybe this person is self-employed, I don’t really know what their situation is. But I think the great thing, dealing with an unbiased mortgage professional like us, and you know, there’s so many out there is we are really the pros at just doing a mortgage, you know, we’re not trying to sell people, you know, a credit card and bank accounts and all this other stuff. And mortgage lending is very, very complex, and everybody’s situation is different. Like it’s really made up of income and assets and credit. And sometimes people just need some advice, you know, they need a plan. And I think that’s where we really, really do excel. So many self-employed people, for example, have had a bad experience with their lender for whatever reason. And I think with us where we have access to so many different lenders, we can always find a solution for people or at least make a plan so then they can, you know, meet those goals.

Terry 11:38
Yeah, and you had a great rep. Thanks a million.

Todd Veinotte 11:43
Okay, thanks Terry, take care.