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girl and boy with arms around each other staring at front door of their home

Expenses of homeownership

The cost to own a home is more than just your mortgage payments. It also includes insurance, utilities, maintenance and more. Here are a few examples of, and advice on how to manage, costs related to owning a home.


You’ve made your down payment, you know what your mortgage payment is and when it’s coming out of your bank account – that should be it for costs for the year, right?

When my boyfriend and I bought our house, it felt like all we were doing was spending money related to our house and paying bills.  We were fortunate to have negotiated some furniture in the sale and were each bringing some pieces with us, which helped us financially, but what we didn’t realize were a lot of extra expenses, we hadn’t anticipated for.  Having lived at home with my parents for my whole life, except for when I lived in Australia, I didn’t really understand all the additional annual costs that exist when you own a house.

When it comes to homeownership, there are many expenses that may come your way, without you realizing. Here are a few examples, and advice on managing these expenses, from my personal experience.

Expenses you don’t have a choice about

  • House insurance – protected for the unexpected: If you own a house, you need house insurance which will protect you if something bad were to happen such as a fire or flood. Even if it wasn’t a requirement of a mortgage, which it is, you definitely want to have house insurance in place and ensure you’re continually renewing your insurance so that you’re covered if the unexpected were to happen. Tip: You can set up a separate bank account to transfer money into every month so when your insurance comes due, you have the money ready to pay it.
  • Property taxes – we have to pay to play: Every year, you’re required to pay an assessed amount to the city or town you live in. This money goes to help pay for education, libraries, road repairs, and other city/town projects. For more information check out https://www.saskatchewan.ca/government/municipal-administration/taxation-and-service-fees/municipal-property-tax-tools. Tip: Paying a lump sum can be tough, but in Regina and Saskatoon, you have the option to pay monthly instalments through the TIIPS program which can make it a bit easier. If monthly payments aren’t an option for you, set money aside each month into a separate account, helping you to save and prepare for the large annual expense.
  • Utilities – keeping the lights on and water running: Water and heat are essential and typically when you move into your new home you’ll have to pay a fee to install these services. Additionally, as a first-time homeowner, you may be required to pay a deposit for your utilities. Tip: Prior to moving into your home, contact your local utility companies to schedule these services and ask what fees they charge for installation. Be sure to add these expenses into your budget for the month you move in.

Expenses you may not expect

  • Water softener – I prefer soft hair: Depending where you live in Saskatchewan and whether it’s a new build or not, your new house may not come with a water softener. A water softner is optional, and if you prefer to have one there are several options available to you: rent, finance or buy. All three have benefits and it’s comes down to what will best fit your needs.
  • Water heater – what’s an anode rod?: You have hot water every time you turn on the tap. That should be all you have to worry about, yes? What some don’t realize is there’s annual maintenance that needs to be done to keep you enjoying those hot bubble baths. Although some things you can do yourself, sometimes its best to leave it to the pros if you’re not too handy, and call in a professional to do the maintenance work, which will be an additional annual expense for you.

Expenses you can choose

  • Cable and internet – Grey’s Anatomy still on and gets me every time: When we first moved in, I didn’t think we really needed anything more than a basic tv package and basic internet. While that’s true, we ended up wanting more after realizing how many great tv shows are on – thank goodness for PVR. Tip: When choosing a cable package, pick one that’s best for you and works within your budget. If needing to reduce expenses within your budget, consider re-looking at your cable package and downsizing to free up some extra money.
  • Landscaping – flowers are so pretty: Our house was a new build, so our backyard was bare at move in. After pulling all the weeds that were the size of shrubs, the first thing we did was bring in soil to raise and even out the yard, so we could lay sod, and then gravel to build a parking pad. We hired someone to build a fence – as stated earlier, some things are better left to professionals – and planted some trees in the front. We were fortunate to have friends and family help us with this, but it was an expense we hadn’t thought about. Tip: Yard maintenance will be an annual expense. Save money throughout the year to help cover yard maintenance costs including unexpected costs like having to replant trees in the front because the rabbits got to them.

These are just a few examples of homeownership expenses I’ve come across in the last year. There are many other expenses, such as home maintenance, and it’s crucial to budget for these costs – especially the ones you don’t have a choice about first -so that you have a realistic idea of what you can afford and are prepared when these expenses are incurred. This is especially true for those months that you will have a bigger payment like your insurance or property taxes, etc.

Are you a homeowner? What are some expenses you’ve come across that you may not have anticipated? What advice do you have for first-time homebuyers? Share with me in the comments below so I can learn more and proactively prepare.

mortgage documents and pen

Fixed vs. variable: picking a mortgage that’s right for you

Fixed or variable? When it comes to picking the type of mortgage rate you want, there are many things to consider. 


There are many questions and decisions to make when buying a house. How much can I afford? Where do I want to be located? How much can I put down? Something you may not be considering though is the type of mortgage rate you want – a fixed rate mortgage or a variable rate mortgage.  Understanding and picking the type of mortgage rate you want is a big decision, and without the proper knowledge and resources, can be quite difficult to make. When choosing the mortgage rate for you, it’s important to look at your situation and ask yourself what you are comfortable with.  Like any big decision someone makes in their life, it often starts with a good old-fashioned pro’s and con’s list.

Fixed

A fixed mortgage rate is one that remains the same throughout the entire term of your mortgage, no matter how much the market fluctuates. With a fixed rate, you’ll know exactly what you’re paying towards the principal and the interest on your mortgage.

  • Pro: Known as the ‘set it and forget it choice’, a fixed rate mortgage provides no risk if interest rates change and can provide a sense of security for people, especially if raising interest rates cause you stress.   
  • Con: Fixed mortgage rates often are higher than variable mortgage rates and are locked-in, meaning if interest rates were to decrease, you wouldn’t be able to take advantage of the lower rates. They typically have higher payout penalties than variable mortgage rates if having to break a mortgage prior to the term being up.

Variable

A variable mortgage rate is one that fluctuates with the market interest rate, known as the ‘prime rate’. What this means is the amount of your mortgage payment that goes to the principal and towards interest can change month-to-month.

  • Pro: Generally, variable mortgage rates are lower and can result in interest savings and provide you with the option to pay your mortgage off faster. Variable mortgage rates also have a lower payout penalty (3 months interest) if the mortgage is broken prior to the term being up.
  • Con: Variable rates have a bit of risk associated with them, as they’re unpredictable due to fluctuating markets. If interest rates increase, the amount you pay towards interest will also increase.

When people hear the term variable, many believe this means that your payment fluctuates. What many don’t know is that when choosing a variable rate you have the option to set your payment amount so it’s the same each time. What this means is that each payment date your payment amount stays the same, but depending on an increase or decrease in interest rates the portion of your payment that goes towards interest and to the principal may change. To learn more, talk to a mortgage specialist.

To help explain the difference between fixed and variable rates further, we recommend checking out this great Know How video by Ontario’s Northern Credit Union.

Your buying situation

There are many factors to consider when choosing between a fixed and variable rate. To help break it down, here are the three questions to ask yourself:

  1. What is your risk tolerance?
  2. What is your financial circumstance?
  3. What are the chances of you breaking your mortgage before maturity?

Risk Tolerance

Everyone’s risk tolerance is different and depends on your personal and financial situation. For some, a bit of risk may be scary, while for others they may be comfortable taking one. If you’re someone who lays awake at night worrying about increasing or changes to payments, choosing a variable rate may not be for you.

Financial Circumstance

Your financial circumstance can have a large impact on determining if a fixed or variable rate is right for you. Do you live pay cheque to pay cheque or frequently spending above your means? If so, a fixed rate may be the better option for you. If interest rates increase causing your mortgage payment to increase does this cause you to worry? If you can handle an increase, a variable rate might be better suited for you.

Breaking your mortgage before maturity

Life happens and things change that may cause you to break your mortgage before your term is up. It’s important to understand when choosing a mortgage the rules around payout penalties – the fee you would pay if you were to break your mortgage before the term ends. Variable and fixed rates have different payout penalty rules and a mortgage specialist can help you to understand the penalty payout rules, but also calculate the payment.

Consider factoring in your personal situation and future goals to help pick a mortgage term length (one-year, three-years or five-years) based on your situation. Ask yourself:

  • What stage of life are you in?
  • Are you purchasing the house with anyone? (e.g. friend, sibling, etc.)
  • Is this home big enough to grow into?
  • Do I plan on relocating for work anytime soon?

With any decision, it is always important to do your research and speak with a mortgage specialist. They can provide you with guidance and advice based on your personal situation, help you to understand market trends and forecasts and assist you in making one of the most important decisions of your life.

To learn more, contact one of Conexus’ Mobile Mortgage Specialists today.

income tax form

Smart ways to spend your income tax refund

It may be tempting to spend your income tax refund on a new pair of shoes or a fancy dinner, but that good feeling of splurging is only temporary. Consider spending your income tax refund using one of these options.


According to the Canada Revenue Agency, close to 90% of Canadians who have filed their 2017 income taxes received a refund, with the average refund being $1676. Do you anticipate receiving a refund this year? If so, how do you plan on spending it?

It may be tempting to use all of this money to splurge on yourself but that good feeling you get from splurging is only temporary. Here are a few smart ways to spend your income tax refund – helping you feel financially-well now and in the future.

Pay off debt

Have a balance on your credit card or line of credit? Working to pay off your student loan or car loan? Consider using your tax refund to reduce or eliminate this debt. Putting towards your debt will not only reduce the amount of debt you have but also decrease/eliminate the interest you’re paying on this debt.

Emergency savings fund

Are you prepared for an unexpected emergency such as job loss, injury or illness? If your car engine went on you tomorrow, do you have money set aside to have it fixed? An emergency savings fund ensures you’re prepared for life’s unexpected curveballs. Use your refund to start or contribute to an emergency savings fund. Unsure how much you may need? Check out our Importance of having an emergency savings fund blog to help you out.

Extra payment on your mortgage

Some mortgages have the option to make extra payments allowing you to pay down your mortgage faster – check your mortgage agreement to see what extra payment options you may have. Consider using your refund to make an extra payment on your mortgage, which will be applied directly to the principal amount. This will not only reduce this debt faster but also reduce the amount of time you’ll be paying off your mortgage.

Put into an RRSP

Retirement may seem far away, but it will be here before you know it. Help reach your retirement goals quicker by putting your refund into a Registered Retirement Savings Plan (RRSP). Check out our Retirement Planner Calculator to see if you’re on track for your retirement goals.

Put towards your child’s education

Post-secondary education costs for your child can add up quickly – will you be ready? Consider putting your refund into a Registered Education Savings Plan (RESP) to help pay for the costs of this education. Our RESP Calculator can help you figure out the cost of your child’s post-secondary education and map out the savings required – through individual contributions and government grants.

Save the money in a Tax-Free Savings Account

Tax-free savings accounts (TFSA) allow you to save money in an investment tax-free, with a maximum yearly contribution limit of $5,500. These accounts are great tools for saving money for short and long-term goals and give you the flexibility to withdraw the money you save at any time. Saving for a family vacation or a new car – consider using a TFSA to get you started. Check out our TFSA Calculator to see your potential benefits to investing your tax refund into a TFSA.

However you choose to spend your tax refund, be sure to do so wisely. A new pair of shoes may be nice, but your return on investment would not compare to using one of the options above. We’d love to chat and see which option may be best for you. Contact us today!

person handing setting of keys to another person

Tips for first-time homebuyers

Purchasing your first home is a big life decision. Our Mobile Mortgage Specialists share advice for first-time homebuyers on what to know and consider when purchasing your first home.


Buying your first home is a huge life event and can sometimes cause a bit of stress. Figuring out where to start can also become a bit overwhelming. All the questions you begin to ask yourself – how much can I afford? Who should I talk to? How much money do I need to put down? To help get you started, and reduce some of that unnecessary stress, we sat down with our Mobile Mortgage Specialist Team to give us their advice on what to know and consider when purchasing your first home.

Planning

As it’s one of the biggest decisions of your life, planning is essential to ensure you don’t get in over your head. Planning early is key and includes asking yourself some important questions including:

  • What type of home do you want to buy? A condo, residential home or perhaps one that has a legal suite in the basement allowing for potential income – or what some like to call a mortgage helper?
  • How long do you plan to live in this home? Is it your starter home? Forever home? What does your life look like in the next 5-10 years? Family, pets, etc. – will this home need to be able to grow with you?
  • What can you afford? What payment would you be comfortable paying that allows you to still live comfortably? Does this amount include all home-associated costs such as utilities, maintenance, etc.? What other expenses impact your affordability such as debt repayment, etc.?
  • How much money do you have saved for a down payment and what will you need?

When starting to think about purchasing a home, these are just a few of the questions you need to be asking. We recommend speaking with an expert, such as a Mobile Mortgage Specialist, to walk you through these questions and to help you come up with a plan. Doing so will allow you to become focused and help you understand exactly what you need to do to get you where you want to be.

Pre-approvals & affordability

Once you have an understanding of what you’re looking for, it’s important to determine how much money you can borrow. Getting pre-approved sets parameters for the amount of loan you’d be approved for and helps ensure you’re not looking at homes outside of your price range.

When getting approved for a mortgage a number of factors are considered including your income, length of employment, credit history, monthly obligations, assets, liabilities, etc. Debt is also a big factor when it comes to being approved. Credit cards, lines of credit, and loans can have a huge impact on how much you’re approved for.

Also, it’s important to understand how your pre-approved amount equates to your payment cycle. Is this amount something you can afford each month, bi-weekly or weekly? And how long do you want to be paying this mortgage off? Twenty years? Twenty-Five? A longer length of time may make your payments lower but can cost you more interest in the long run.

Remember, whatever you are pre-approved for doesn’t mean you need to spend the full amount on a home. Purchasing a lower-priced home means you’ll need to borrow less money, potentially smaller payments, and the ability, if it works within your budget, to potentially pay off your home more quickly.

Down payments

First-time homebuyers are required to put down a minimum of 5% of the purchase price – for example, if you’re looking to purchase a $300,000 home, you’ll need to put down $15,000. Seems like a lot, right? And another reason why planning is essential.

Start saving for a down payment as early as you can. Consider putting into a savings account, Tax-Free Savings Account or RRSP. Take the ‘pay yourself first’ approach and put a certain amount of money into a separate account each payday. Label the account something that means something to you such as ‘down payment’ or ‘house account’ as you’ll have a better chance leaving the money alone. Also consider putting any extra money you receive such as a work bonus, gift money, money you make selling some of your own personal items, income tax refunds, etc. into this account to help grow your savings faster.

Programs and incentives for first-time homebuyers

There are several programs and incentives for first-time homebuyers that you should be aware of.

  • The Home Buyers’ Plan allows first-time homebuyers to withdraw money from your RRSP to buy or build a qualifying home. You will need to repay these funds back into your RRSP within 15 years.
  • Saskatchewan’s first-time home buyer’s tax credit provides first time homebuyers with a provincial non-refundable income tax credit of up to $1,075 to eligible taxpayers on qualified homes.
  • The Head Start Equity Builder Program allows first-time homebuyers to take a personal loan as a down payment to purchase a new home constructed by the HeadStart on a Home Program.

Also, consider looking at what local builders have to offer homebuyers. During certain times of the year, or in certain community developments, builders offer incentives such as no down payments or down payment grants to encourage homebuyers to purchase through them.

Other considerations/things to know

There is a lot to know when it comes to purchasing and owning a home, and it can be hard to think of it all by yourself. Along with the advice above, here are a few additional things to know and consider.

  • Lean on your experts. Don’t try to do this alone and work with people who are experienced and have your best interests in mind. Your realtor and mortgage specialist are there to offer you a wealth of information to help guide you step by step and ensure as little stress as possible during this exciting time.
  • Set money aside for all the additional fees associated with purchasing a home such moving expenses, inspection fees, home and life insurance, utility hookups, taxes, lawyer’s fees, etc. We recommend setting aside 1.5-2% of the purchase price to help cover these different costs.
  • Filling your new space can come with a cost. The great part about planning in advance means you can also start setting money aside for furniture, household items and your first grocery trip to fill your cupboards with all of the staple items. Another great tip is to create a list of items you’ll need, watch for sales and purchase throughout your planning timelines, putting anything into storage until you move. Be sure to share this list with family and friends for ideas on what to get you for birthdays and Christmases.
  • Use www.expressaddress.com to have your mail forwarded to your new address, update your address within existing companies and even set up your utilities for your new home. It’s free and will help you save time.
  • Budget. Budget. Budget. With new home ownership comes new expenses, and it’s important to have an understanding of your money and budgeting for your newest life chapter. When setting a budget, be sure to put money aside for some of those unexpected expenses such as maintenance or breakdowns. Check out our Setting a Budget blog to get you started.

Buying a home for the first time can be stressful but with a bit of planning, and working with a team of experts, your transition into home ownership can run smoothly. Remember, you’re not in it alone. We’re here to help.

Ready to start your first-home plan today or have additional questions? We’d love to talk to you – contact one of our mortgage specialists today and let’s start planning your future today!

Home for sale sign

Mortgage stress tests: what to know

Keep hearing the term mortgage ‘stress’ test but unsure what it means to you. In this blog, we break it all down for you and provide advice on what you should consider when it comes to your mortgage.


There has been a lot of talk about the new mortgage restrictions aka “mortgage stress tests”. But with all the coverage and information out there, what does this actually mean and how does it impact you?

Starting Jan. 1, 2018, if you’re applying for a new mortgage (e.g., buying a new home), re-advancing an amount on your mortgage (e.g., renovations), or switching your mortgage to another financial institution, you’ll be subject to a “stress test”. What this means is that your advisor will assess your finances and qualifications based on a higher interest rate than what they are today.

What many don’t know is this process is already in existence for people applying for mortgages with a down payment of less than 20% of the home purchase price or those with a term of less than five years. The new restrictions will now include those who have a larger down payment and longer term time.

Credit unions are not governed federally, and provincially are not legally bound to comply with these new restrictions. However, as a mindful and trusted community partner, many credits unions already have similar policies to ensure our member’s financial well-being is a long-term focus.

“Approving a member for a mortgage that they could not afford to repay over the long term, simply to satisfy a higher purchase price, does not agree with our values as a credit union, nor increase a person’s financial wellness,” said Kris Wanner, Manager, Financial Services, Conexus Credit Union. “Also, it doesn’t promote community growth, all of which are key components to our cooperative.”

This “stress test” is being put into place to protect homeowners from rising interest rates which may impact their overall finances.  Lending rates have been at a historically low level for a number of years. Lately, we’ve seen a rise in interest rates which speaks to the why behind this stress test.

By factoring your ability to repay, and in turn how much they can spend on a home purchase, at a higher rate of interest provides you peace of mind knowing the greatest asset (and largest borrowing) you will ever have is something you can afford to repay.  It also presents the opportunity for you and your advisor to discuss the difference between “What I qualify for” and “What I can afford”.

“Being aware of your finances and your plans will give you a better understanding of what you can afford and not feel stressed,” said Wanner. “It’s also important to think of all variables when looking at affordability. Many times people forget of other expenses, which can cause them financial stress in the future.”

When it comes time to applying for a mortgage or renewing your mortgage, take a broad look at your finances and your plans – look back at what’s changed and where you want to go. Don’t forget to also look at all other factors and expenses that may be associated with homeownership, such as:

  • Property taxes;
  • Condo fees;
  • Utility bills;
  • Insurance; and
  • Home security.

Other expenses such as loan and credit card payments, food, entertainment, etc. are also important to consider.

Homeownership all starts by understanding the money you have and what you spend. Once you have an understanding, you can then create a holistic plan that works for you.

If you have any questions on what you just read or would like further information on mortgages, ask in the comments below or click the ‘Talk to us about banking button’ below to contact us.