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Pattie Lovett-Reid

Chief Financial Commentator, CTV

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ANALYSIS: We talk a lot about the housing market, shopping around for a mortgage and the benefits of a fixed mortgage vs variable mortgage all the time on BNN. Yet it appears not everyone is as comfortable talking about this subject as we are.

A new report by PC Financial reveals nearly half of Canadians would rather discuss their dating history with a partner over mortgages with their broker. That's right, 41 percent of first time homebuyers would rather dish about past loves than exploring the right mortgage option for them.

This just doesn't make sense to me. I really don't care about someone's romantic past and yet on one level I appreciate the point they are making and suggest they are using this example to be demonstrative.

The mortgage process has become confusing, the real estate market even more so when you consider the sky high prices in areas like Toronto and Vancouver. Sure rates are low, but how do you know you are getting the best deal you can get? Then even if you think you are getting a good deal, for the first time in your life you actually have to budget and that too seems foreign with one-third of the respondents between the ages of 20-45 not understanding how to stick to a budget and make mortgage payments each month.

I think this is a serious issue and education is key. You cannot make informed decisions about your finances without being knowledgeable, understanding the financial commitment you are making and the ramifications of bad decisions.

Here's the good news: you don't have to be an expert, but you have to be savvy enough to figure out what you don't know and get the help you need. And many are doing just that. When it’s time to begin the mortgage process, 72 percent agree they will speak to a parent or relative first for advice. Great place to start, but I would encourage diversification of your resources as well. Speak to a representative at your financial institution, a mortgage broker or consider a respected website like RatesSuperMarket.ca.

Well intended parents -- and I would consider myself to be one -- could be biased. In the past, I might have suggested locking in for 5 years to give yourself some certainty around the payments for a period of time. According to the survey, 54 percent of Canadians agree a fixed rate is always better than a variable mortgage when considering the purchase of your first home - even though this isn't always the case. And while 3/4 of the respondents aged 20-45 feel they understand the factors that determine whether it is wiser to own vs. rent, some 53 percent also agreed that it is safe to purchase a home with only 15 percent down despite the recommended downpayment of at least 20 percent.

Buying a home without understanding all the facts in my opinion takes the phrase, "Buyer Beware" to a whole new level.

As the Chief Financial Commentator for CTV News, Pattie Lovett-Reid gives viewers an informed opinion of the Canadian financial climate.