Rising interest rates triggered by the out of control inflation that’s impacting negatively on the Canadian economy is having a ripple effect on many Black home-owners who now face the threat of losing their homes due to household debt levels that are steadily creeping upwards.
Jacqueline McLaren is a licensed mortgage real estate broker with VANTAGE MORTGAGE REALTY GROUP. She believes that the trials and tribulation of this situation can be easily avoided with proper education and professional
guidance.
“The older generation don’t realize that they have access to something called the chip mortgage, where it’s a reverse mortgage where you don’t have a monthly payment.”
The CHIP Reverse Mortgage allows Canadian homeowners age 55+ to access up to 55% of their home’s value and turn it into tax-free cash without having to move or sell and no monthly mortgage payments required. It allows homeowners to turn some of their home equity into tax-free cash. Owners can access up to 55% of the home’s value. The amount that is accessible is based on several factors such as; age, property location, home type and appraised home value.
According to McLaren, many older homeowners in the community they are not aware of the various options available to them, and this ignorance could result in dire consequences that could have been easily avoidable.
“I helped a lady last week, she was in her 80s, about to lose her home that was worth around $800,000. I was able to find her financing that she wasn’t aware was an option,” she told the CONTACT recently.
“There’s a lot of ignorance, they don’t teach you this in school so we just go blindly.”Also she says many individuals and families about their credit situation.
“I’ve been seeing is that a lot of Black families very indebted and unsure of their options. You could consolidate your existing debt into your home if you have equity.”
McLaren is in the process of helping another community member save his home and had him joined a three-way call to talk about the urgency of the situation facing many in our community.
With an increase in interest rates, Mr. A’s house was on the brink of foreclosure, he had letters telling him that his house was going to be seized in less than 90 days. He almost believed it but thankfully after consulting with McLaren he discovered he had options to save his home.
and also acknowledged the need for education and seeking help from experts to be able to buy and maintain their homes.
“Sometimes you need to delegate it to an expert because they can do it more efficiently. They ask the right questions and what not to avoid and what to avoid, and they’re just better at it and it’s OK to delegate instead of trying to take on everything yourself,” Mr. A (Name withheld).
McLaren also advices that everyone should be cognizant of their credit and do what’s necessary to maintain a good credit rating, especially those who are considering buying their first home.
“The importance of understanding and maintaining credit is one of the biggest issues I find in the
community.
Most people don’t know how the system works, she says and that include younger people.”
“ They don’t know how to prepare themselves to go buy a house. The first step is to maintain your credit, don’t buy a car before the house because it’s going to affect your hopes of getting a mortgage because we have to include that payment when we’re doing the assessment.
A lot of us don’t know that. So, some go get a fancy car and when they come for mortgage consultation, they already have a $700 payment which makes it hard to get a mortgage for a house.”
McLaren believes that more Black families can still own homes even though interest rates have gone up. If they plan and make smart financial decisions, home ownership is still within their grasp. Consultation with professionals; maintaining good credit and better spending choices are some of her tips to the community for a more secure financial standing.
And for older home-owners, she advises: “The bank doesn’t have the final say on your home. All you need to do is consult and there is help and there are options.”
You can reach Jackie McLarene at : (514) 992-7783.
