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Operating a Mortgage Brokerage in Toronto, one thing that I see often is folks who have the dreams and ambitions to own a home. Only, with fast changing economic conditions, Toronto banks and Toronto finance companies often change what they require in order to qualify for a mortgage. In January your financial situation may have been acceptable to the bank but now it’s not.

We refer to this as the ever-narrowing mortgage box. The truth of the matter is that hundreds of loan programs exist in Toronto for people who do not fit the conforming box. Below are a few examples of some specific of problems that Canadian consumers encounter when trying to qualify for a mortgage in Toronto. We have also included some tips how you can overcome these challenges.

1. My debt-to-income ratio is too high
SOLUTION: There are many loan programs on the market today which feature “expanded criteria” allowing higher debt-to-income ratios for qualifying purposes. While some of these programs come with premium pricing, others do not, and offer the borrower a viable source for getting a loan. Mortgage brokerages often have ready access to equity and or private lenders who allow for expanded ratios. However, fees are usually charged for non-conforming mortgages and mortgages arranged where little or no documentation is available or is inadequate. Most of these programs come at a higher price than conforming loans but offer a loan source for individuals who do not qualify through any other program.

2. I don’t claim all of my income on my financial statements
SOLUTION: If you are self-employed or derive some or all of your income from commission or tips, your financial statements may not reflect all of this income, or you may counter-balance this income with expense write-offs. In this instance, a “stated income” or “no-income” verification loan may help you qualify. With sufficient down payment and adequate credit, the lender will not verify the income stated on your application.

3. I have poor credit history
SOLUTION: The “Non-Conforming” or “B /C” market is one of the fastest growing in the mortgage industry. A program exists for nearly every credit problem including bankruptcy and foreclosure. Rates for these programs are typically based on the borrower’s previous 24 months credit history. Mortgages are available at competitive rates.

4. I have little or no money for a down payment
SOLUTION: Insured loan programs and combination first and second mortgage programs allow for residential home purchases with as little as 5% down payment

5. I have little or no established credit
SOLUTION: Many lenders will accept “alternative credit references”. In these instances, the borrower may need to provide references or proof of payment for things such as rent, electric, water, or insurance. Assuming adequate payment history, many first-time homebuyer programs will accept these references as sufficient credit history.

For more information about how to qualify for a mortgage visit http://www.firstequity.ca.

By David Mandel, Principal Broker and CEO of First Equity Financial Group.

By: Dave Mandel

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Chances are if you have been in business for a while that you have some sort of routine to track your finances. But one of the top challenges that small business owners report is not carving out time to regularly update their accounting. With so many other competing priorities there always seems to be a response to reschedule this task. But is there really time to do accounting later? This article includes tips for dealing with accounting tasks before they get out of control.

Pay attention to the signs.

There are many signals in business that tell you when the time is right to get more support. When it comes to task of accounting you will notice the signs when your systems are inefficient, non-existent and do not provide the information you need when you need it. Review your accounting regimen to ensure that the proper procedures are in place.

Find the missing pieces

When there are gaps in the accounting cycle business owners tend to have unanswered questions in day-to-day management. Accounting provides you with information to help you choose the best direction for your business. Look for the missing pieces in your process that blocks you from having information that is accurate, timely, and reliable.

Use a checklist

You can avoid missing opportunities to improve performance with checklists. Knowing what key accounting information you need allows you to accelerate business growth. For example, if your company allows customers to make purchases on account establish a regular routine that includes accounts receivables reporting and collections follow-up. The accounting procedures should enable you to smoothly manage the data needs and critical reporting requirements for your business. It starts with maintaining an organized process for handling source documents and flows through to the end with financial analysis.

Set-Up Your Accounting Information System

There are companies that have operated for years, and aside from the annual income tax return, do not have any financial reports to review. As a result, the owner has no real idea of how the company is doing. It is important that you have a way to manage and compile data into information that you can use. A good place to start if you do not have any systems in place is by organizing your files and then setting up the accounting system. There are several options for accounting systems including manual, spreadsheet, and accounting software. If you are unsure where to begin speak with a bookkeeper or accountant who can walk you through the process. In the end the best accounting method is the one that makes the process easy for you.

By: Benita Tyler

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Awful Truth: If you’re having a tax issue, you’ve probably spoken to several companies about getting help. Maybe some of them sounded good, some sounded not so good. But there’s a good chance some of these companies have mentioned the word “Retainer Fee” over the phone. It sounds a little strange and it probably wasn’t explained very well. All you want to know: what is it and how does that affect you?

What is a Retainer Fee? A Retainer Fee, by definition, is an advance payment on the hourly rate for a specific case. This basically means that the fee is a “prediction” of how mch the service will cost. They assume that the work they are going to perform is going to cost at least that amount. Many companies implement this because attorneys are known for wanting to get paid before they actually do any work.

What that Means to You? When a company has you pay a “Retainer Fee,” one of the clauses of that agreement is that the fee is “subject to change.” As most of us know, anytime a business can get more money out of you they usually will. So these guys will take your money for a “retainer” (usually between $1000 and $2000 dollars) and then change it later by saying the case needs more time, attention, and therefore more money.

Does the Price always Change? It would be inaccurate for me to say that the price always changes. But I’ve seen it happen in several cases. Someone puts $1500 dollars down on a case, and then a few weeks later the company asks for another $1500. Then they keep “working” on the case and a month later they ask for another $1500. It’s a sad thing but it happens to people every day.

How to Avoid It: If or when you hear the words “retainer fee,” hang up the phone. You don’t want to take the risk of falling into a situation like that; where you pay much more than you bargained for. Now you have the knowledge, you can be armed when you get calls from those tax resolution companies.

Now you have the Smoking Gun…Use It!

By: Richard Close

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Business management training plays a key role in the success of a business. It helps employees understand the importance of their role in the business, introduces important skills that improve their efficiency, and motivates them to play a big role in the long-term success of the business.

Benefits of Management Training

A well thought-out, comprehensive management guidance program can be a great tool to professionalize family business management. It clearly defines the role of various employees – from entry-level workers to managers – in the business and makes them understand the importance of the same. It also discovers the managerial and leadership skills hidden in people.

A good business management training program encourages people to think big. It encourages employees, particularly those who are young and dynamic, to come up with new ideas and perspectives that might be of great value to the business. It helps them understand the core values of the business, gives them a good idea of the direction in which the business is going, and prepares them to play a bigger role in making the business more profitable.

Choosing the Right Program

There are a large number of companies that offer management training programs to both small and large businesses. You, as a business owner, should choose a program that caters to the specific needs of your business.

You should remember that what works for a Fortune 500 company may not work for you and what works for you may not work for another organization. So, it is important to choose a family business management training program that suits your needs best.

The success of a training program depends on the skills your employees learn, the extent to which they use those skills to improve their performance, and their understanding of the core values of your business. So, it is important to talk to the training company, make the trainers understand the mission and vision of your business, and make sure their training program can deliver the results you want.

A good business management training program should appeal to all sections of an organization. This is particularly important in a family business where there are fewer employees and everyone is leading everyone else. So, in order to avoid an ‘us vs. them’ feeling among employees, everyone – from entry-level workers to executives – should have equal access to the training material.

As a business owner, you need to know that building leaders, encouraging new ideas, and grooming new talent are some of the most important aspects of family business management. The success of your business depends on doing these things the right way at the right time. A good management training program can help you do all these things and put you firmly in control of the future of your business.

By: Wayne Messick

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Would you ever think of taking a trip to a foreign location without some type of tourist guide or map? Could you imagine doing this and then the feeling of suddenly realizing that you have no idea where you are or what to do? I would imagine that would be a terrifying experience. Fortunately people take trips like this all of the time and these types of experiences are averted through proper planning. Operating a business without a business plan is like taking a trip without a map. You do not want to dedicate precious time to building a business only to suddenly realize that you have no idea where you are or what to do.

We often see entrepreneurs who are working so much on the day-to-day tasks of building the business that they do not take the time to properly plan. Usually the business owner did not take the time to properly plan for the future. This is one of the biggest mistakes a business owner can make. In this article I will outline 5 reasons an entrepreneur needs a business plan to keep their business on the right track.

Provide a Roadmap

A business plan provides a guideline to help you achieve your goals. Mapping out a plan helps you in determining which strategic path you will use to reach your desired destination. The research and brainstorming conducted during the writing of the plan will assist you in figuring out where the business should go while providing a complete set of instructions to help you get there. The primary goal of a business plan is to provide a roadmap that ensures your business is heading in the right direction and stays on course.

As a Motivational Tool

Business plans are very important for internal motivation and the motivation of stakeholders. While writing your plan the first step you should take is to identify the correct business plan template needed. Secondly, you must determine your vision, or where you want to see your business in the next 1-3-5-10 years. Creating this vision becomes a motivational tool because it allows you to see the possibilities you can create for your business if you follow the plan.

Identify Strategic Integration

A comprehensive business plan assists the entrepreneur in making a cohesive strategy that brings into account all the elements of the strategic business plan, and identifies how they associate with each other. Looking at the business in this way promotes the elimination of components of the plan that do not correlate with the greater vision. The plan helps you to identify how you can build your company over time. For example if you have an existing business you might try to expand the business through your existing clients. Your strategies might evolve around deepening your client relationships through customer relationship management. A system for reaching out to clients could help move the company forward.

Increase Creativity

Strategic business plans can help to increase the creativity associated with the business. Without creativity, your company is only one of the many competing for market share in your field, area, or industry. By using a creative approach you can design a business that sets itself apart in the marketplace with a distinctive look and brand. All too often, we see bland, boring marketing messages and products presented in uninspired ways. To succeed you must stand out in the crowd by getting creative and differentiating your business by identifying your competitive edge. A well-crafted business plan can help you do just that.

Define Desired Outcomes

In simple terms a business plan helps the entrepreneur get the job done. The business plan defines the desired outcomes and outlines the steps necessary to reach them. By performing the actions dictated in the business plan, the entrepreneur is able to stay on track. It is easy to get lost in the day-to-day details of the operation as pointed out before. By reviewing the plan periodically, the business owner is reminded to schedule time to do the strategic tasks outlined in the business plan. In short, taking focused and strategic action leads the entrepreneur to success.

It is very important that an entrepreneur sets a direction before moving forward. This can only be done through proper business planning. Below is an honest review of a company that can help you do just that. It may be the key to your success.

Make sure you set yourself up to be successful and do not find yourself in a strange land without a map. Develop a strategic business plan that will outline the growing success of your organization over time, and watch as your business succeeds beyond your wildest dreams.

By: Quentin Smith

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I believe all business is fundamentally the same.

How can all companies be the same? A restaurant is very different from a hydro-electric power station just as a bus service is equally different in essence to an accountancy practice. Aren’t they? I believe there are two key elements to all businesses: “Product or Service” and “Profit” or put another way, provide and survive.

What is the “it”- the essence of a business? Is it electricity from an HEP station, tax returns that save you money from an accountancy firm or the restaurant that serves hot or cold food on time in the manner you requested? The client is only interested in one thing – the end product or service they are buying. How that is produced or brought into being is irrelevant to them; as the producer or supplier that is your issue, not theirs. The company may have to employ specialist skills, knowledge of equipment, language and labour relations or specific motivational or managerial skills. These are of no interest to the client who simply wants product or service ‘X’ on date ‘Y’ for the agreed price.

The other element to any business is profit. A provider of products or services is not in business unless they are making a profit and without profit the company cannot survive. You might debate this point when it comes to loss leader marketing techniques and market share capture initiatives. At the end of the day the business must make a profit in some form or other in order to survive.

The combination of all the elements that go on behind the scenes cost money: manufacturing, learning, training, marketing, building, teaching and developing all take place to differing degrees prior to the product or service being delivered. Knowing the sum of all these costs and charging them to the client is the process of doing business.

Adding a mark-up on that cost is the principle of running a profitable business. The final price will be driven by what the external market forces allow, competition, cost of raw materials, costs of staff and the clients’ ability to pay. Fundamentally business is the supply of a product or a service to a client at a given price that will allow the business to continue to trade. All companies must provide and survive.

Why then, when looking at external advice and coaching, do clients demand or request specialists in their particular field? A consultant or coach working in a specific project in a key area of a business naturally will have specialist knowledge, be that IT Integration systems or HR Law. The more specific the remit and project the more specialised the consultant or coach needs to be. However when driving business growth in conjunction with motivation, strategy, communication and planning, an in-depth knowledge or experience of one particular area can hamper progress.

For example a consultant or coach working in the health and fitness industry might focus primarily on the day-to-day running of the health centre – areas such as staff recruitment, management, pool ph and chlorine levels, health and safety, cleaners, and class schedule. In contrast a non-specialist coach or consultant will focus more closely on the two fundamentals of business – provide and survive – member numbers, retention of members, quality of service, consistency of service and other sources of income. The pH levels in the pool are details that the client is not concerned about unless it goes wrong, so the process needs to be in place in the background, but the focus should be elsewhere on growing the business.

I appreciate the example is very general and includes a number of sweeping generalisations of both consultants and coaches and the health and fitness industry, so apologies to those who disagree.

This does not change the key point that a non-industry specialist’s objective view point will take the bigger picture view of the business without being constrained by the small details that do not affect the overall goal, which is to provide and survive.

Many years ago I started working for a large group of companies. On the first day I was given a thesaurus of jargon terms used by the company, it was several pages long. I realised that the focus was very much on the details rather than on the doing. This reinforces my argument that in order to provide and survive the business has to be made simple. If company staff need a dictionary to understand what is being said internally, how will the clients feel? The client simply wants product or service ‘X’ on date ‘Y’ for the agreed price. If the producers complicate that system and make it difficult for the client there will be always be a competitor elsewhere more than willing to take over.

Third party outside advice can be crucial to a business. I believe an objective, unbiased opinion can give a far greater return in the grander scheme; for that reason I work with all of the above. Give the client the product or service at a price that brings you the level of profit that will enable the company to survive to fight again another day. Provide and survive.

By: Mike Pagan

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