10 Must-Know Credit Score Facts

Your credit score plays a major role in your financial life, affecting everything from loan approvals to interest rates and even rental applications. Despite its importance, many people don’t fully understand how their credit score works. Here are 10 key facts you need to know about credit scores in Canada.

1. Two Credit Bureaus, Two Scores

Canada has two credit-reporting agencies: Equifax and TransUnion. Your credit score may vary between the two, as different lenders report to different bureaus.

2. You Can Check Your Credit Report for Free

Your credit score is based on the information in your credit report. You can request a free copy of your credit report once a year from Equifax and TransUnion to review your financial history. Many banks and financial services also provide free credit score access.

3. Credit Scores Range from 300 to 900

The average Canadian credit score is 650. The higher your score, the better your chances of approval for loans and lower interest rates.

4. Credit Scores Are Used Beyond Loans

Lenders aren’t the only ones checking your credit score. Landlords, insurance companies, employers, and mobile phone providers may also review it before making decisions.

5. Five Key Factors Affect Your Credit Score

Your credit score is based on:

• Payment history (late or missed payments hurt your score)
• Credit utilization (using less than 35% of your available credit is ideal)
• Length of credit history (longer credit history helps)
• Types of credit (a mix of loans and credit cards is beneficial)
• Credit inquiries (applying for too many new credit accounts can lower your score)

6. Errors Happen—Check Your Report Regularly

Mistakes or outdated information can negatively impact your score. Review your credit report and dispute any errors with Equifax or TransUnion.

7. A Score of 700+ is Considered “Good”

A credit score above 700 increases your chances of loan approvals, better credit limits, and lower interest rates on mortgages, auto loans, and credit cards.

8. Credit Scores Change Constantly

Your score updates regularly based on new financial activity. If you’ve made mistakes in the past, you can rebuild your score over time with responsible credit use.

9. Checking Your Own Score Won’t Hurt It

Checking your credit score through a bank or credit bureau is a “soft inquiry” and does not lower your score. However, frequent applications for new credit (hard inquiries) can have a negative effect.

10. How to Improve Your Credit Score

• Pay bills on time
• Pay off balances in full whenever possible
• Keep your credit utilization below 35%
• Maintain a mix of credit types (credit cards, installment loans)
• Apply for new credit sparingly

Final Thoughts

Your credit score is more than just a number—it’s a key part of your financial health. Even if you’re not planning to borrow money soon, maintaining a good credit score can save you money and open up more opportunities in the future.

If you need help understanding your credit score or want to improve your financial situation, reach out to me today!

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A second mortgage can be a powerful financial tool for homeowners who need access to additional funds. Whether you’re looking to consolidate debt, invest, or cover unexpected expenses, understanding how a second mortgage works is crucial. Here are four key things to keep in mind before taking out a second mortgage.

1. Second Mortgages and Home Equity

The amount you can borrow through a second mortgage depends on the equity you have in your home. Homeowners can typically access between 80% and 95% of their home’s equity, depending on their financial profile.

For example, if your home is valued at $850,000, and you qualify for a 95% Loan-to-Value (LTV) second mortgage:

• Maximum mortgage amount (95% LTV): $807,500
• First mortgage balance: $550,000
• Available second mortgage amount: $257,500

2. Interest Rates on Second Mortgages

Since second mortgages pose a higher risk to lenders, they often come with higher interest rates than traditional home loans. However, alternative and private lenders may provide flexible options, making second mortgages accessible even to those with credit challenges.

3. Payment Flexibility

One of the advantages of second mortgages is the variety of payment options available. You can choose:
✅ Interest-only payments to keep monthly costs low
✅ Interest + principal payments to pay down your loan faster

Working with a mortgage broker can help you determine the best payment structure based on your financial goals.

4. Additional Fees to Consider

Before proceeding, be aware that second mortgages often come with additional fees, which may include:
📌 Appraisal fees
📌 Legal fees for mortgage setup
📌 Lender and broker fees, especially with private lenders

Is a Second Mortgage Right for You?

A second mortgage can be a better alternative to refinancing or a HELOC, depending on your financial needs. If you’re interested in learning more about how a second mortgage can work for you, reach out to me today for expert advice tailored to your situation!

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Managing debt in retirement can be overwhelming, especially with a fixed income. Traditional debt consolidation options like personal loans, refinancing, or home equity lines of credit often require a strong credit score and steady income—barriers that many retirees face.

A Smarter Debt Solution: The CHIP Reverse Mortgage

For Canadian homeowners aged 55 and older, the CHIP Reverse Mortgage from HomeEquity Bank offers a way to consolidate debt without monthly payments. By leveraging home equity, retirees can eliminate high-interest debt and improve their financial stability.

Why Choose the CHIP Reverse Mortgage?

• No Monthly Payments – The loan is repaid only when you sell, move, or pass away.
• Easy Qualification – Approval is based on home equity, not income or credit score.
• Tax-Free Cash – Access up to 55% of your home’s value without affecting OAS or GIS benefits.
• Flexible Payment Options – Receive funds as a lump sum or in installments.
• No Negative Equity Guarantee – You or your heirs will never owe more than the home’s fair market value when the loan is due.*

Comparing Debt Consolidation Options

• Refinancing or HELOC – Requires strong credit and income, with the risk of foreclosure if payments are missed.
• Unsecured Personal Loans – Often come with high interest rates for those with poor credit.
• RRSP Withdrawals – Can trigger withholding taxes and impact retirement income.
• Balance Transfer Credit Cards – May require proof of income to qualify for 0% interest offers.

Take Control of Your Retirement Finances

Debt shouldn’t define your retirement. The CHIP Reverse Mortgage allows you to consolidate debt, eliminate monthly payments, and enjoy financial freedom while staying in your home.

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Owning a home is a fantastic way to build equity, which can open up financial opportunities down the road. Whether you’re planning renovations, consolidating debt, or need access to funds, a second mortgage can be a powerful financial tool. Let’s break down what you need to know!

What is a Second Mortgage?

A second mortgage is a loan taken out on a property that already has an existing mortgage. Unlike purchasing a second property with a new mortgage, this type of loan taps into your current home equity. With a second mortgage, your home equity serves as collateral, which means it comes with its own interest rate, monthly payments, terms, and associated costs.

Second Mortgages vs. Refinancing

While both second mortgages and refinancing let you use your home equity, they serve different purposes:

• Refinancing: Typically done at the end of your mortgage term, refinancing allows you to adjust your interest rate, change terms, or borrow against your equity—often without penalty.
• Second Mortgage: Enables you to borrow a lump sum or access funds through a line of credit, even before your existing mortgage term ends. You can use the funds for anything, from home improvements to major purchases.

Advantages of a Second Mortgage

• Access to Larger Funds: Borrow up to 90% of your home equity in some cases.
• Lower Interest Rates: Typically cheaper than credit cards due to being secured by your home.
• Flexibility: Use the money however you want—no restrictions.

Disadvantages of a Second Mortgage

• Higher Interest Rates: Often higher than refinancing options.
• Increased Financial Pressure: Comes with an additional monthly payment and financial responsibility.

Is a Second Mortgage Right for You?

Before pursuing a second mortgage, it’s essential to evaluate your financial situation and explore your options. A Dominion Lending Centres Mortgage Expert can help you assess your needs and determine the best solution for your goals.

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As Canadians approach their retirement years, financial security becomes a key concern. Many retirees face challenges such as lower Canada Pension Plan payments, diminished or non-existent company pensions, insufficient retirement savings, and the rising cost of living. However, there is a solution that can help you enjoy the retirement you’ve worked so hard for: the CHIP Reverse Mortgage by HomeEquity Bank.

What is the CHIP Reverse Mortgage?

The CHIP Reverse Mortgage is a financial solution designed specifically for Canadian homeowners aged 55 and better. It’s a loan secured against the appraised value of your home, enabling you to access up to 55% of your home’s equity as tax-free cash. The best part? You can stay in the home you love without the burden of regular mortgage payments.

This innovative financial tool offers flexibility, allowing you to receive your funds as a lump sum, regular monthly deposits, or a combination of both. You don’t have to repay the loan until you decide to move or sell your home.

Meeting Your Financial Needs

Retirement should be a time of relaxation and enjoyment, not financial stress. The CHIP Reverse Mortgage can provide the financial freedom you need, helping you:

• Increase Monthly Cashflow: Boost your income to cover daily expenses.
• Consolidate Debt: Simplify your finances and reduce stress.
• Purchase Another Property: Invest in a vacation home or downsize comfortably.
• Cover Medical Expenses: Ensure you’re prepared for unexpected healthcare costs.
• Renovate Your Home: Make your living space more comfortable or accessible.
• Fulfill Your Dream Vacation: Create memories you’ve always dreamed of.

Embrace a Richer Retirement

Your home is more than a place to live; it’s a valuable asset that can unlock financial security. By leveraging the equity in your home, the CHIP Reverse Mortgage empowers you to live the retirement you’ve always envisioned. Whether it’s funding your dream vacation, making necessary renovations, or simply increasing your monthly cash flow, this solution provides the freedom and flexibility to enjoy your golden years.

Contact Your Mortgage Expert Today

Ready to discover how the CHIP Reverse Mortgage can enhance your retirement? Reach out to your Dominion Lending Centres mortgage expert today and learn how your home can work for you. Start living the retirement you deserve!

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Refinancing your mortgage can be a smart financial move for many reasons, and as your trusted mortgage advisor, I’ve seen how much it can benefit homeowners!

Ideally, refinancing is done at the end of your mortgage term to avoid penalties, but the timing can vary depending on your goals. For some, it’s about unlocking the equity in their home to fund renovations or cover big expenses like college tuition. For others, it’s an opportunity to consolidate debt, lower their interest rate, or change up their mortgage product.

Let’s take a closer look at some of the ways refinancing your mortgage can help!

• Get a Better Rate: As interest rates have continued to decrease with the Bank of Canada updates these past few months, now is a great time to consider refinancing for a better rate and lower overall mortgage payments!  Experts anticipate the Bank of Canada will move to have the overnight rate down to 4.0% at year-end and potentially down to 2.75% for 2025.
• Consolidate Debt: When it comes to renewal season and considering a refinance, this is a great time to review your existing debt and determine whether or not you want to consolidate it onto your mortgage. In most cases, the interest rate on your mortgage is less than you would be charged with credit card companies or other forms of financing you may have. Plus, having all your debt consolidated into a single payment can keep you on track!
• Unlock Your Home Equity: Do you have projects around the house you’ve been dying to get started on? Need funds for a large purchase such as a new vehicle or post-secondary education? When you are looking to renew your mortgage, it is a great opportunity to consider refinancing in order to take advantage of the home equity you have built up to help with these larger changes in your life!
• Change Your Mortgage Product: Are you unhappy with your existing mortgage product? If you have a variable-rate or adjustable-rate mortgage, you may be considering locking it in at the lower rates. Alternatively, you may want to switch your current fixed-rate mortgage to a variable option with the interest rates expected to continue decreasing into 2025. You can also utilize your refinance to take advantage of a different payment or amortization schedule to help pay off your mortgage faster!

PLUS! Some latest changes by the Government of Canada will make it even easier for you when it comes to your renewal and refinancing options:

• Those of you who may have an uninsured mortgage will no longer have to pass the stress test as of November 21st. This means that you have more flexibility when it comes to rates and mortgage products in renewal cases where you wish to switch lenders without adding additional funds to your mortgage!
• Beginning January 15, the federal government will allow default-insured mortgages to be refinanced to build a secondary suite. If you’ve been considering adding a suite to your property, you may be eligible to access up to 90% of your home’s equity for this purpose.

No matter your plans or situation, please don’t hesitate to reach out to a DLC Mortgage Expert!

Published by DLC Marketing Team

Buying your first home is a significant milestone! While you’re thinking about your affordability and what type of home you want to own, we have some exciting updates around first-time homebuyer benefits:

New or Pre-Construction Homes: Did you know? First-time buyers looking to purchase a new build or pre-construction home are eligible for 30-year amortization. This mortgage commitment can allow you to have smaller monthly payments, versus a standard 25-year amortization.

Mortgage Default Insurance: The CMHC has recently made it so mortgage default insurance will cover up to $1.5 million homes (increased from $1 million), helping more Canadians qualify for insured mortgages.

The Home Buyers’ Plan (HBP): The Canadian government has a program known as the Home Buyers’ Plan (HBP), which is designed to allow first-time homeowners to withdraw up to $60,000 from RRSP to buy a home!

Purchasing with your spouse? You can access a total of $120,000 from your RRSP’s.

First Home Savings Account (FHSA): The First Home Savings Account (FHSA) is specifically designed to help first-time homebuyers save for their down payment without paying taxes on the interest earned on their savings. The maximum is $8,000 annually that you can add into this account to save, with a maximum of $40,000 lifetime contributions.

First-Time Buyer Exemption: First-time home buyers are eligible for an exemption, reducing the property transfer tax you pay. If the fair market value of the property is:

• $500,000 or less, you can claim an exemption amount equal to the full amount of property transfer tax.
• Over $500,000 but no more than $835,000, the exemption amount is $8,000.
• Over $835,000 and under $860,000 then the exemption amount is proportionally reduced up to $15,200.

Land Transfer Tax Rebates: First-time buyers in Ontario, British Columbia, Prince Edward Island, and the City of Toronto are able to claim land transfer tax rebates.

With the Bank of Canada rate decreases throughout the summer and into September, I thought this would be a great opportunity to update you on what this means for your mortgage.

If you’re on a variable-rate mortgage, this will result in a slight decrease in your mortgage payments to match the current rates giving you more cash flow each month!

For example, if your mortgage balance is $750,000 at the previous 5.95% interest rate your approx. compounded monthly payment was likely $4,809. With the new rate of 5.45% your approx. compounded monthly payment on an adjustable-rate mortgage will be $4,583*. This is an estimated $226/m decrease ($30/m per 100k balance) on your payment.

*Rates based on example of Prime minus .50% (old prime 6.45 and new prime 5.95)

For those of you who are on fixed-rate mortgages* or have renewals coming up, this reduction in interest rates could make it easier on you at renewal time. The decrease in interest rates gives you more borrowing power in the market – this means your money can go further!

*Remember, the drop in the Bank of Canada fixed rates may not result in the same drop for fixed mortgages as with variable rates. The decrease in interest rates will however open up new variable options and, depending on your lender may still provide allow you to take advantage of lowered rates.

This is the same for first-time buyers! Lower interest rates mean you now have more borrowing power in the marketplace, which could help you find that perfect home by allowing you to allocate monthly funds to your mortgage more comfortably.

In more good news, The Bank of Canada has two more decision dates this year in October and December. Experts anticipate the Bank of Canada will continue these quarter-point rate cuts, taking the overnight rate down to 4.0% at year-end and potentially down to 2.75% next year.

Whether you’re a current homeowner, looking to renew, or wanting to purchase, this is exciting news for Canadians across the country!

However, keep in mind rate is not the be-all-end-all of mortgages. It is important to keep in mind that factors such as type of mortgage, down payment amount, payment schedule, amortization, and more will also affect your mortgage and affordability.

If you want more information about your specific mortgage and how this affects your situation, please don’t hesitate to reach out to a DLC Mortgage Expert today!

What does it mean to build a rich legacy? Many Canadians think of their legacy in terms of the assets they leave behind—in other words, money. However, legacy is not just about wealth; it’s about enhancing the lives of our loved ones and making meaningful contributions to our community.

This blog will explore living legacies and how the CHIP Reverse Mortgage can support these goals.

Supporting the Next Generation

Many young Canadians face financial challenges, especially when it comes to homeownership. One solution for helping the next generation is the “Bank of Mom and Dad.”

Helping with a Down Payment

With rising housing prices, saving for a down payment can be a significant hurdle for young Canadians trying to purchase their first home. This is where the “Bank of Mom and Dad” comes into play. Using a portion of your home equity through the CHIP Reverse Mortgage will give your children the financial boost they need to enter the housing market. Not only does this support them during a critical life stage, but it allows you to witness the joy and stability homeownership brings to their lives.

Creating Educational Funds

Another meaningful way to establish a living legacy is by creating educational funds for your grandchildren. Education is essential for personal and professional growth and opens new opportunities. Investing in your grandchildren’s education safeguards their future and empowers them to pursue their dreams. Imagine the joy of witnessing their achievements, knowing that your generosity played a role in their success.

Helping With a Wedding

If you have children or loved ones you support, their wedding is a special milestone you’ll want to help make unforgettable. With weddings being so expensive, it can be overwhelming for the couple. By accessing your home’s equity with the CHIP Reverse Mortgage, you can contribute to their big day and create lasting memories, all while keeping your finances secure.

Charitable Donations

Giving back is a powerful way to leave a legacy. By actively participating in charitable causes, you care about, you help those in need and strengthen your connection to the community. Whether you contribute financially or donate your time and skills, charitable giving can provide personal fulfillment and happiness. Charitable donations also offer valuable tax benefits.

Family Traditions and Memories

A living legacy isn’t solely about financial support; it’s also about creating lasting memories and traditions with your family. Memories are some of the greatest treasures in life. Whether planning special family trips, capturing life’s precious moments in a photo book, or simply spending more time with loved ones, these intangible gifts often bring the greatest joy and comfort.

How the CHIP Reverse Mortgage Supports Your Goals

For Canadian homeowners aged 55 or older, the CHIP Reverse Mortgage is an innovative financial solution that allows you to access up to 55% of your home’s equity without the need to make monthly mortgage payments. The best part? You can stay in the home you love.

By accessing your home’s equity, you can fund your living legacy goals—helping your children with a down payment, setting up educational funds, contributing to charitable causes, or investing in family traditions. The CHIP Reverse Mortgage provides you with the financial flexibility to enrich the lives of your loved ones today while maintaining your financial independence.

If you’d like to learn more about how the CHIP Reverse Mortgage can help you leave a legacy, contact your DLC mortgage expert.

The initial Bank of Canada rate cuts this past summer did not spur housing activity as anticipated, but with an additional cut early September and potentially more on the way, they will continue to affect the housing market outlook.

New listing levels are expected to rise as sellers who may have held back enter the market with the hope that lower mortgage rates will attract additional buyers.

While the current Bank of Canada rate of 4.25% may still not be enough to make a dent in home affordability, it does provide a glimmer of hope for potential buyers as interest rates continue to fall.

In addition, while home prices have cooled a bit, home prices in Canada remain among the highest in the world’s most advanced economies (Japan, France, Germany, Italy, and the UK). These still -high prices have resulted in many potential first-time home buyers to withdraw for now. Higher property taxes, higher qualifying stress-test rates, and the current wave of mortgage renewals will also factor into how successful the Fall market will be.

In 2023 alone, the country saw an influx of 46% of new Canadians, which also contributes to housing demands and pricing. As rates continue to drop, the hope is that prices will stabilize owing to increased supply as demand rises.

If you are looking to get into the housing market as a buyer or seller, or simply have questions so you can best prepare yourself for a future move, don’t hesitate to reach out to me today!