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Mortgage 101 – building secondary suites | May 2021 Part 4

In this episode of Mortgage 101 with Clinton Wilkins and Todd Veinotte, as heard on News 95.7, the guys talk about refinance for building secondary suites, Jeopardy!, and real estate appraisals.

Mortgage 101 with Clinton Wilkins & Todd Veinotte – May 2021 – Part 4

Don’t feel like watching the video? Check out the transcript below.


Welcome to part four of May’s Mortgage 101!

Todd Veinotte: [00:00:06.87] Nova Scotia boy right there.

Clinton Wilkins: [00:00:08.28] You know what? We’re doing a lot of like Nova Scotia, Canadian, Atlantic Canadian theme, but you know what? I like it.

Todd Veinotte: [00:00:16.62] Yeah, why not right? This is a Nova Scotia show.

Clinton Wilkins: [00:00:20.04] Yeah, it is. And you know what? We started the show with a song from, I think he’s kind of like a friend.

Todd Veinotte: [00:00:27.54] Who was it again?

Clinton Wilkins: [00:00:28.32] Adam Baldwin. You know him?

Todd Veinotte: [00:00:30.27] No. Is he related to the other Baldwin’s?

Clinton Wilkins: [00:00:32.46] Maybe if they’re Nova Scotian, but I don’t think so.

Todd Veinotte: [00:00:36.04] Know any other Baldwins?

Clinton Wilkins: [00:00:37.32] Yeah, no.

Todd Veinotte: [00:00:39.04] In Hollywood?

Clinton Wilkins: [00:00:39.06] He’s probably just as like Halifax, famous as they are like famous in the rest of the world.

Todd Veinotte: [00:00:46.78] That makes no sense.

Clinton Wilkins: [00:00:47.98] I know.

Todd Veinotte: [00:00:48.34] Said like zero…

Clinton Wilkins: [00:00:49.11] Zero zero.

Todd Veinotte: [00:00:49.83] I tried to pull it together and give you some props, but I’m sorry.

Clinton Wilkins: [00:00:53.04] I’m just sorry. It just didn’t come together.

Todd Veinotte: [00:00:54.99] There you go. But the show’s coming together. It’s Mortgage 101, Your Guide to Homeownership with Clinton Wilkins, myself, Todd Veinotte, right here on News 95.7. I don’t know why I’m saying it like that, but it’s kind of fun.

Clinton Wilkins: [00:01:06.15] Maybe you say News 95.7 like so many times during the week that now you just have to like, spice it up just for yourself.

Todd Veinotte: [00:01:12.84] Sometimes you have to spice it up just for yourself. I would have to agree with that sometimes.

Clinton Wilkins: [00:01:16.51] I mean, you know, you need to do what you got to do. And I really thank everybody for tuning in on the weekend. And, you know, we’re here Saturday and Sunday, either 10 am on Saturday or 11 a.m. after The Weekend Gardener with Niki Jabbour.

Todd Veinotte: [00:01:29.86] Is it 11 or 12? Because I think your show goes to, it’s a two hour show, isn’t it?

Clinton Wilkins: [00:01:33.13] Well, I guess you’ll hear us when you hear us. And we’re actually here in downtown Halifax. So, yeah.

Todd Veinotte: [00:01:40.17] Your new digs.

Clinton Wilkins: [00:01:40.98] And new digs. Well, we’re in our temporary new digs, and this is the first time you’ve been over here and you don’t love going downtown even though you live in Halifax.

Todd Veinotte: [00:01:47.97] I don’t mind it in the evening.

Clinton Wilkins: [00:01:49.53] In the evening. It’s no big deal.

Todd Veinotte: [00:01:50.76] It’s not a big deal because the parking’s free.

Clinton Wilkins: [00:01:52.98] And I can walk two blocks from my condo down to our space here at 5151 George. So, you know, we love being downtown. We’re kitty-corner to Province House. We’re right beside the art gallery. There’s really nowhere else I’d rather be. And I really can’t wait for the summer. We are right on the Halifax Harbor, so.

Todd Veinotte: [00:02:10.71] Can you, can you send, like, a car for me next time?

Clinton Wilkins: [00:02:14.31] If you want a car, we’ll send a car.

Todd Veinotte: [00:02:16.35] Is that right?


Clinton Wilkins: [00:02:17.10] You know what? You are hali famous. And did you see on Jeopardy! the question? It’s trending on social media and for those of you,

Todd Veinotte: [00:02:27.09] Isn’t Alex Trebek dead?

Clinton Wilkins: [00:02:29.19] On Instagram,

Todd Veinotte: [00:02:30.90] I thought he was dead.

Clinton Wilkins: [00:02:32.55] Our producers are laughing in the background, so we’re not really sure what’s so funny. But maybe it’s you, Todd. I don’t know.

Todd Veinotte: [00:02:39.72] Well, he said Jeopardy!. He’s dead.

Clinton Wilkins: [00:02:42.90] Anyway.

Todd Veinotte: [00:02:42.93] God rest his soul. He’s Canadian content, but

Clinton Wilkins: [00:02:47.55] The question was…

Todd Veinotte: [00:02:48.57] Yeah?

Clinton Wilkins: [00:02:49.26] It was around, it was what is a haligonian?

[00:02:53.25] No.

[00:02:53.33] You know, people from Halifax.

Todd Veinotte: [00:02:54.78] On the real Jeopardy!?

Clinton Wilkins: [00:02:56.25] On the real Jeopardy!.

Todd Veinotte: [00:02:57.60] I don’t believe you.

Clinton Wilkins: [00:02:59.28] It’s all good. You don’t need to believe.

Todd Veinotte: [00:03:00.69] Ok, so we should talk some, some business.

Clinton Wilkins: [00:03:03.60] Let’s talk about mortgage lending. Let’s talk about real estate.

Refinance for building secondary suites

Todd Veinotte: [00:03:05.91] What we were talking about was developer, or building and renovations and how that ties in with mortgage lending. That’s one of the more intricate parts of your business is it not?

Clinton Wilkins: [00:03:15.69] Exactly. And more and more people are doing renovations to their homes, their existing homes than they ever had before, Todd. I think one of the big reasons is, you know, if you’re going to sell your home, you need to buy a new home, probably. And the cost of buying a resell property right now is really at all time highs. And, you know, if you’re going to do a new construction home, it takes a long time to get a home built. So a lot of people are renovating their existing homes and they’re using credit facilities like a refinance bill to fund it. And you can refinance your existing home up to 80 per cent of the market value, which I think is really interesting. And let’s say the average house price in Halifax is $400,000. That means that you can refinance up to 80 per cent of that market value.

Todd Veinotte: [00:03:57.99] If you got the equity.

Clinton Wilkins: [00:03:59.25] Yeah. So we can give you a new credit product up to $320,000 less your existing mortgage and or a secured line of credit.

Todd Veinotte: [00:04:06.96] Right. Okay, so what about these backyard suites? Are these, are you doing any of this business?

Clinton Wilkins: [00:04:13.71] You know what? We get inquiries on backyard and laneway suites all the time. Typically, the lenders are not really on side with it quite yet.

Todd Veinotte: [00:04:23.37] Really? Why?

Clinton Wilkins: [00:04:24.21] They want, they’re okay with secondary suites, but they really want them to be in and attached to the existing unit. So I think they’re are a lot cooler, more cool with maybe doing like an over under set of flats, maybe a basement apartment, side by side is certainly acceptable. I think any time that there’s a second unit that’s not attached, that adds a lot of questions. And there’s a lot of lenders who don’t like that. And I think that will change. You know, as you know, the laws change, especially with the municipalities. I think lenders are going to catch up. It might take some time, though.

Todd Veinotte: [00:04:59.29] So when it comes to establishing how much money you’re going to need to do the renovation, you talked about the expenses associated in the previous segment with lumber prices, not just lumber prices,

Clinton Wilkins: [00:05:09.46] Everything.

Todd Veinotte: [00:05:10.00] Contractor prices, everything, all of that, it’s all going through the roof. So sometimes the numbers just won’t work, obviously. But how does it work? How do you, do you have to have your own resources and then you get funded after? Right? That’s how it works?

Clinton Wilkins: [00:05:23.71] So there’s kind of two schools of thought. If you already own the property, the first way is you can refinance up to 80 per cent of the as-is value of your home. And you may have enough equity now, especially with the increase home prices in Halifax and down the South Shore, the property values certainly have increased. So you may have enough equity depending on how much you owe already. So that could be an option. And I mean, really, that’s the easiest option. Let’s be honest, refinance up to 80 per cent of the asset value. The other option is you may want to choose to do the renovations on your own. So that might be unsecured credit. Maybe that’s cash. I’m not sure. Get the renovations done and then we do a refinance. We can refinance up to 80 per cent of the as improved value, which I think obviously would be much higher, hopefully, if you’re doing the right type of renovations. And at that point, we can, we can lend you 80 per cent of what that appraisal value comes in at. So that oftentimes is a great solution. And then we can either pay off the debt that you took out to build, to do the renovation, or we can replenish your cash or investments that you used.

Real estate appraisals

Todd Veinotte: [00:06:31.48] So the appraisal is key, right? And what are you seeing when it comes to appraisal? Do often people get the number that they’re looking for. I’m sure that it varies.

Clinton Wilkins: [00:06:38.83] I would say nine times out of 10 right now, they get the number that they want.

Todd Veinotte: [00:06:42.01] Nine out of 10?

Clinton Wilkins: [00:06:43.09] It’s, you know what? We’re having a lot of great, great appraisals come in right now. We’re not seeing the values come in low. If anything, we’re seeing the values coming higher than what consumers think their home is worth. You know, when we’re getting an appraisal and someone’s buying a home, not always, you know, not every time that’s coming in. I’ll tell you why. Sometimes people are buying homes now with an emotional intention versus like a business transaction. So when you’re paying $100,000, $150,00, $200,000 over the list price over the assessment value, sometimes the appraisal value is just not supported because the market hasn’t caught up yet. Maybe you’re setting that new standard of what the appraisal will come in at. And you know what? That might be challenging because you can only get 80 per cent of the appraised value at a maximum if you’re doing a refund.

Todd Veinotte: [00:07:32.38] And you’re not, you’ve said this before, you don’t view real estate in an emotional way. Not, no criticism to those who are sentimental. But you think it’s good to maintain some barrier there and look at it for eventually what it will be: an investment.

Clinton Wilkins: [00:07:47.38] I’ve certainly had some negative feedback, even maybe from some listeners on the air. You know, I got a message once saying that I use you know, you use the word housing stock like it was just like an arbitrary commodity. And I do understand it’s people’s homes. You know what? I grew up in the same house growing up. My parents had the same home from 1985 and my dad’s still there today. So, you know, it’s not that I grew up in a culture of it, that it was a commodity. But I’m in a business where it’s a commodity and you know, some people are emotional about their home and some people are not. And I think that taking the emotion out oftentimes will better serve you business wise. But when it is an emotional decision, you need to then accept it for what that is. And if the appraisal does come in light, so be it. It is what it is. If you really want that house and you’re going to be in that home for, you know, the next 25 years, who cares if you pay a little bit more than what the appraisal value is. As long as you have enough skin in the game to cover that shortfall.

Check us out on social media

Todd Veinotte: [00:08:51.55] How do people get a hold you?

Clinton Wilkins: [00:08:53.05] The first place to check us out is online. You can check us out at Lots of great information there. We have hundreds of blog posts about a variety of different topics. There’s current rates on there and there’s contact information. And you can certainly check us out on social media. There’s links to our social media accounts right from the website. So, is a great place to start.

Todd Veinotte: [00:09:15.97] And this podcast that we’re doing right now, you’re, we’re recording this with your production team and you use parts of this as well. Tell people quickly.

Clinton Wilkins: [00:09:25.03] Yeah, this is going to be on Facebook, on Instagram, on LinkedIn, and people are going to be able to listen and see us interacting. And it’s all being videotaped, which I think is cool. We have actually live streamed our show before from the studio where this is a podcast format, new for 2021, you know, in our ever changing market and media, we are going to take little snippets and share that with our consumers all month long.

Todd Veinotte: [00:09:53.23] Clinton It’s been great, as always. Thanks so much. We’ll be back next month, of course, on News 95.7.

Clinton Wilkins: [00:09:57.82] Thanks for having me, Todd.

Todd Veinotte: [00:09:58.45] You, got it. Clinton, Wilkins and check him out online, as mentioned and thanks for listening here on News 95.7, Mortgage 101, Your Guide to Homeownership with Clinton Wilkins and myself, Todd Veinotte. We’ll see you next month.

If you have any questions, get in touch with us at Clinton Wilkins Mortgage Team! You can call us at (902) 482-2770 or contact us here.