18 Jan

The Bank of Canada Raises its Key Interest Rate

General

Posted by: Anne Martin

On Wednesday January 17, 2017, as expected, the Bank of Canada raised its key lending rate by one quarter point to 1.25%.  This would put the rate at the highest level since 2009 when the economy was faltering.  This was done even with the cloud looming over NAFTA negotiations.

Economists differ as to the validity of the increase.  We are hearing reports of the economy being in excellent shape with the lowest jobless numbers in decades but according to other economists predictions we may be heading for a slow down in housing markets due to interest rate increases and tougher mortgage rules that could take many prospective home owners out of the market.  Higher interest rates may amplify household debt or perhaps people will buy less and within their means, causing a reduction in consumption, which again is not good for the economy.

My gut says that there has to be a happy medium somewhere between consumerism and debt management where we can spend enough to keep the economy moving but not too much to put ourselves in too much debt.

We are expecting three rates hikes this year causing the overnight rate to increase to 1.75%.  Many lenders have already increased their prime lending rate to 3.45% increasing variable rate mortgages.  If you are in a variable rate mortgage, this is a good time to discuss your options with a broker.

As always, I’m still seeing people who want to consolidate their debt into their mortgages in order to reduce interest costs and improve cash flow.  I don’t think there will be an end to this option, especially if you have lots of equity in your home.

In my opinion, we are still in great shape. To put today’s rates in perspective, interest rates climbed to 21% in the early 1980s.  We are lucky to be living in a country where our government, no matter the party, is looking out for our interests to ensure this doesn’t happen again.

For more info on the rise in Bank of Canada rates check out this article by Dr. Sherry Cooper, economist Dominion Lending Centres.  https://dominionlending.ca/news/bank-canada-raises-rates-cautiously/

16 Jan

NDLC Monthly Newsletter for January 2018.

General

Posted by: Anne Martin

HAPPY NEW YEAR!
Welcome to the January issue of my monthly newsletter !

This month’s edition looks at the new mortgage rules that just came into place and budgeting in the New Year.
Please let me know if you have any questions or feedback regarding anything outlined below.

Thanks again for your continued support and referrals!


Mortgage rule changes explained

 

By now, we’re all aware of the major mortgage rule changes that have started to come into effect at the start of the year. To recap, in October, the Office of Superintendent of Financial Institutions, or OSFI, introduced tighter rules on mortgages set for Jan. 1, 2018. While there were several changes announced, the biggest affects consumers with uninsured mortgages, who must now undergo a qualifying stress test. More specifically, under the new rules, non-insured mortgage consumers (buyers using a conventional mortgage with a down payment worth 20 per cent or more of the purchase price) must now qualify using a new minimum qualifying rate.
The minimum rate will be the greater of the five-year benchmark rate published by the Bank of Canada or the lender’s contractual mortgage rate plus two percentage points. The stress test for non-insured mortgages applies to both fixed- and variable-rate mortgages.

The new qualifying rules effectively reduce the buying power of a consumer with an uninsured mortgage by 20 per cent, according to industry experts. Paul Taylor, the president and CEO of Mortgage Professionals Canada (MPC), a national association that represents the mortgage industry, described the impact of the new rules as a “purchasing power haircut.” And he‘s concerned just how much impact the new rules will have on the real estate market and economy in general.
While Taylor doesn’t expect major price reductions in hot markets like Vancouver and Toronto, he suggests it could be more detrimental to struggling economies in other regions of the country like the Prairies and Atlantic Canada.
“Reducing the number of people who can afford those homes now is only going to exacerbate the problem,” he says, adding that when someone’s largest asset loses value, they tend to spend less. “When house prices come down, you can potentially create a recessionary environment in pockets across the country.”

How we got here

For the government to poke around the mortgage industry is nothing new. In October 2016, Ottawa introduced a number of changes including a stress test that meant all new or insured mortgages needed to qualify at the greater of either the Bank of Canada posted rate for mortgages or the contract rate plus two percentage points.
It caught the mortgage industry off guard. In the months that followed, it also galvanized organizations like MPC to lobby politicians and bureaucrats in Ottawa on behalf of the industry. Now, MPC is calling on the federal government to reduce the new stress test to three quarters of a percentage point. If someone is locked into a five-year term, their equity and income will likely increase during that time, Taylor explains, but the proposal also meets OSFI’s intent to encourage a more risk-averse lending environment.

In response, officials with OSFI provided background on the proposed rule changes. A spokesperson for OSFI explained that the regulator’s job is to “prepare federally regulated financial institutions to navigate a number of severe but plausible scenarios, while continuing to provide financial services to Canadians and maintaining the confidence of the public.” “As residential mortgage lending represents a material portion of activities at many federally regulated financial institutions we regulate, it is important that lending practices in this area be governed prudently and with appropriate risk controls,” the backgrounder continues. Predicting how housing and economic environments will develop is challenging, but OSFI recognizes the potential risks caused by high household indebtedness across Canada, and by high real estate prices in some markets. OSFI reviews its guidance on an ongoing basis to ensure it is aligned with industry practices and! the evolving financial services environment. We are not waiting to see those risks crystallize. Rather, we are being proactive and adapt our standards to the evolving housing markets and economic environment.”

Those feeling battered by all the new obstacles can take heart, though. The head of MPC doesn’t expect any further changes until after the next federal election in 2019. “I’d like to think they’re [the government] done,” Taylor says. “I don’t have a crystal ball, but my suspicion is you won’t see much else.

Making 2018 your turnaround year

 

It’s become a bit of a cliché to talk about resolutions at the start of the New Year. You’re going to be inundated with pitches to exercise more, “eat right” or pick up a new hobby. These resolutions start out with the best of intentions but ultimately most of us can’t manage to keep them. Within a few days or weeks, we’re back to our old habits. Perhaps only a psychiatrist knows why we can’t keep our resolutions. While giving up the sweets might seem like an impossible task, getting into some good financial habits at the start of the year is easier than you think. And there is no better time to look at what you might be doing right and perhaps wrong when it comes to your finances and make a change to see a more prosperous 2018. These are by no means brand new ideas but rather tried and tested concepts worth considering.

  • Set and write down your financial goals for the year. Having these goals written down will help you stay on task. Review them as often as you need to.
  • Review your household budget. Sometimes we get caught off guard by just how much money we’re spending every month. Take a good look at those expenses, and if there are a few items you can cut, go for it. Everyone has something they spend their money on they think they can’t live without. But being fiscally responsible takes some discipline.
  • Pay down your credit cards. Credit can be a great thing. It helps get you out of a bind when you need it, or help with an important purchase you can pay for later. But having too much credit-card debt can hurt in the long run. Try to pay off as much of your credit-card debt as you can. Every little bit helps.
  • Plan for an annual review day. That means sitting down with your accountant, financial planner, even your mortgage broker to see where you are with your finances. Can you pay a little more for your mortgage? Is there a new government policy or an investment that you haven’t heard about from which you could benefit? Financial professionals are up to speed on all the latest options and can advise you accordingly.
  • Be realistic. We’re constantly squeezed between the things we want to buy and the bills we have to pay. You’re not likely going to go from zero to hero financially in a month, but taking a few easy steps, making good choices and chipping away at your debt will start to pay off.

These are just some basic tips to follow. With so many experts and places to look for financial advice, there’s really no excuse not to use the turn of the calendar to get started.

 

HOMEOWNER TIPS…
Let the heat reach you:

 

Dust or vacuum radiators, baseboard heaters and furnace duct openings often and keep them free from obstructions such as furniture, carpets and drapes.

Replace/Clean Furnace Filters:

Check and clean or replace furnace air filters each month during the heating season. Ventilation system filters, such as those for heat recovery ventilators, should be checked every two months.

4 Jan

2018 might just be the year to buy a home! Mortgage Market Update

General

Posted by: Anne Martin

MARKET UPDATE

2018 might just be the year to buy a home!  Canada’s real estate market is bound to take a hit this year thanks to the government’s new mortgage rules that took effect on January 1st.

The rules, aimed at making sure Canadians can afford to meet their monthly mortgage payments if interest rates rise, will intentionally make it harder for buyers to qualify for an uninsured mortgage.

Read more

Best fixed rates are as low as *2.84 – 3.49 % for a 5 year fixed,
variable rate mortgages from as low as p-.85%
Prime Rate is 3.20%

*High Ratio/Quick Close Specials
This is a critical time to sit down and review your household financing needs. Please do not hesitate to contact me should you have any questions.

If you are in the market for a home, book an appointment today to see how the recent regulatory changes by the Office of Superintendent of Financial Institutions will affect your purchase.

**rates subject to change with market conditions – *OAC  **conditions apply E. & O. E.

Terms Bank Rates Our Rates
6 Month 3.14% 3.10%
1 YEAR 3.04% 2.89%
2 YEARS 3.24% 2.54%
3 YEARS 3.44% 2.99%
4 YEARS 3.89% 2.89%
5 YEARS 4.99% *2.84 – 3.49 %
7 YEARS 5.30% 3.69%
10 YEARS 6.10% 3.74%
Rates are subject to change without notice. *OAC E&OE
 **Please note that rates shown above are subject to change without notice. The rates shown are  posted rates and the actual rate you receive may be different, depending upon your personal financial situation. “Some conditions may apply. Rates may vary from Province to Province. Rates subject to change without notice. *O.A.C. E.& O.E.”

 

21 Dec

Big Mortgage Changes Jan. 1, 2018. Consumer’s Home Digest December 2017

General

Posted by: Anne Martin

Big Mortgage Changes Jan. 1, 2018

There has been significant press coverage around upcoming changes to mortgage lending rules that will take effect Jan. 1, 2018. These rules will affect many more people than most realize. They will affect people seeking a mortgage most obviously, but they will also affect those with a mortgage in many ways as well. Let’s take a look at some key areas of concern for both groups, those with a mortgage, and those without (but seeking) a mortgage.

What is the impact?

A reduction of 20 per cent-plus in maximum borrowing power for those with a 20 per cent or GREATER down payment. You read that correctly, a big reduction for the group with the bigger down payments.

The Have Nots

You don’t have a mortgage yet, but you have a Pre-Approval, so you think you’re safe with that Pre-Approval…you may be and also you may not be. A select group of lenders have confirmed they will grandfather existing Pre-Approvals under the 2017 lending rules for up to 120 days. However many lenders will not; for them Jan. 1, 2018 is a hard stop on the old lending rules. Still others are already enforcing the new rules. The questions is; what is your lender going to do? Not all lenders have announced their policies yet either.

The best advice; pick up the phone and call your mortgage broker and get an answer from them as to where you stand.

Question#1; Do the new guidelines affect you?

Question#2; If Yes to Q #1 – Is your Pre-Approval going to be grandfathered with the lender that holds it?

The Have’s

You already have your mortgage, so everything is all cool right? Maybe.
Are you thinking of increasing your mortgage amount by even just $1?
Are you thinking of adding on a secured line of credit for even just $1?

And most importantly of all:

Are you thinking of moving your mortgage to a new property in 2018?

To add new money, or to move the mortgage to a new property, will trigger a re-evaluation under the new rules, and many Canadians will not qualify for the very mortgage they currently have if they try to move it to a new property.

Sure your mortgage is most likely portable, but re-qualification could mean a big reduction in the size of it.

Who is safe?

Those who are simply renewing their current balances.

None of these changes impact you if you are renewing your mortgage for the same amount with the same lender. But, before you do that, read the ‘Did You Know’ footnote below, and as always pick up the phone can give me a call before you do anything else.

If you have any questions about refinancing, reducing debt or paying down your mortgage quicker, I’m here to help!


Returning To The
‘A-Side’

Every year Canadian families are caught in unexpected bad circumstances only to find out that in most cases the banks and the credit unions are there (to lend you money) only in the good times, not so much during the bad times.

This is where thousands of families have benefitted over the years from the services of a skilled mortgage broker that has access, as I do, to dozens of different lending solutions including trust companies and private lending corporations. These short-term solutions can help a family bridge the gap through business challenges, employment challenges, health challenges, etc.

The key to taking on these sorts of mortgages is always in having a clear exit strategy, which in some cases may be a simple as a sale deferred to the Spring market. Most times the exit strategy involves cleaning up credit challenges, getting consistent income back in place and moving the mortgage debt back to a mainstream lender. Or as we would say in the business an ‘A-lender’.

The challenge for our clients, and for us as mortgage brokers, over the past few years, arguably over the past nine years, has been the constant tinkering with lending guidelines by the federal government. And the upcoming changes of Jan. 1, 2018 (referenced in the first story above) represent far more than just ‘tinkering’.

This next set of changes are significant, and will effectively move the goal posts well out of reach for many clients currently in ‘B’ or private mortgages. Clients who have made strides in improving their credit or increasing their income will find that the new standards taking effect will put that A-lender mortgage just a little bit out of reach as of the New Year.

There is concern that the new rules will create far more problems than they solve, especially when it seems quite clear to all involved that there are no current problems with mortgage repayment to be solved.

Yet these changes are coming our way fast.

Are you expecting to make a move to the A-Side in 2018?

It just might be worth your time to pick up the phone and call me today.

1 Dec

Why are longer amortizations taking over? Read Mortgage Market Update December 2, 2018

General

Posted by: Anne Martin

30-year mortgage amortizations are taking over: Four reasons why

Once upon a time, 25 years was the standard amortization on a Canadian mortgage.

Today, no less than 63 per cent of new low-ratio mortgages by value, have amortizations over 25 years. That’s a surge of 11 percentage points in just two years.

Meanwhile, six in 10 Canadians consider longer amortization periods “bad debt practice,” according to a recent survey by Manulife Bank.

The maximum amortization for a mortgage in this country is generally 35 years, although some non-prime lenders will do 40 years.

So why are so many people extending their amortization when the majority deem it inadvisable?

Find out why…

Best fixed rates are as low as *2.84 – 3.49 % for a 5 year fixed,
variable rate mortgages from as low as p-.85%
Prime Rate is 3.20%

*High Ratio/Quick Close Specials
This is a critical time to sit down and review your household financing needs. Please do not hesitate to contact me should you have any questions.

If you are in the market for a home, book an appointment today to see how the recent regulatory changes by the Office of Superintendent of Financial Institutions will affect your purchase.

**rates subject to change with market conditions – *OAC  **conditions apply E. & O. E.

Terms Bank Rates Our Rates
6 Month 3.14% 3.10%
1 YEAR 3.04% 2.89%
2 YEARS 3.24% 2.54%
3 YEARS 3.44% 2.89%
4 YEARS 3.89% 2.89%
5 YEARS 4.99% *2.84 – 3.49 %
7 YEARS 5.30% 3.69%
10 YEARS 6.10% 3.74%
Rates are subject to change without notice. *OAC E&OE
 **Please note that rates shown above are subject to change without notice. The rates shown are  posted rates and the actual rate you receive may be different, depending upon your personal financial situation. “Some conditions may apply. Rates may vary from Province to Province. Rates subject to change without notice. *O.A.C. E.& O.E.”
24 Nov

Will OSFI regulations really strip consumers of choice? Mortgage Market Update Nov. 24, 2017

General

Posted by: Anne Martin


 

Will OSFI regulations
really strip consumers of choice?

The Office of the Superintendent of Financial Institutions has been repeatedly excoriated by mortgage industry veterans for its intervention, but not everybody believes the lending regulations will spell doom and gloom.

Read More…

Best fixed rates are as low as *2.84 – 3.49 % for a 5 year fixed,
variable rate mortgages from as low as p-.85%
Prime Rate is 3.20%

*High Ratio/Quick Close Specials

This is a critical time to sit down and review your household financing needs. Please do not hesitate to contact me should you have any questions.

If you are in the market for a home, book an appointment today to see how the recent regulatory changes by the Office of Superintendent of Financial Institutions will affect your purchase.

**rates subject to change with market conditions – *OAC  **co

Conditions apply E. & O. E.

Terms Bank Rates Our Rates
6 Month 3.14% 3.10%
1 YEAR 3.04% 2.89%
2 YEARS 3.24% 2.54%
3 YEARS 3.44% 2.89%
4 YEARS 3.89% 2.89%
5 YEARS 4.99% *2.84 – 3.49 %
7 YEARS 5.30% 3.44%
10 YEARS 6.10% 3.74%
Rates are subject to change without notice. *OAC E&OE
10 Nov

B20 Demystified. Mortgage Market Update November 10, 2107

General

Posted by: Anne Martin

MARKET UPDATE
B20 DEMYSTIFIED  The office of the Superintendent of Financial Institutions (OFSI) announced some regulatory changes on October 17, 2017. There were 3 changes announced, but it was the introduction of a qualifying rate stress test to all non-insured mortgages that will have the most impact on consumers.Home Buyers with a down payment of 20% or more must now qualify at a new minimum qualifying rate, which is the greater of the five year Bank of Canada Benchmark rate or the lender contractual rate +2%

What does this mean?

The biggest impact will be on the amount in which the homebuyer will be able to qualify. For example, if a homebuyer needs a $400,000 mortgage, has 20% down payment and a 25 year amortization, here is the difference:

Actual Rate to be Paid:            To Qualify:
Mortgage Amount $400,000 Contract rate 3.49%  The greater of the two: 4.99%, the current BOC Benchmark Rate OR 3.49% contract rate + 2%,WHICHEVER IS HIGHER = 5.49%
Monthly Payment for Debt Ratio Qualification $1994.98   $2439.24
Minimum Income Requred to Qualify $76,724.12   $90,052.14

E & OE – rates shown are subject to changing market conditions and OAC

To recap:

Uninsured Mortgages- Homebuyers/owners will now have to qualify for a mortgage using the benchmark rate, which is the Bank of Canada rate (currently 4.99%) or the lender rate + 2%, whichever is greater.

Insured Mortgage- Homebuyers must qualify using the Bank of Canada Rate (again, currently 4.99%). This came into effect in 2016 and has not been affected by the recent rule changes.

Can you still refinance your home? – yes. Homebuyers still can refinance up to 80% of the value of the property but the new stress test applies.

What if you have a contract written prior to October 17, 2017? – This depends on the lender. Some lenders will use current rules up to January 1, 2018. Others will implement the necessary changes before this deadline.

Best fixed rates are as low as *2.84 – 3.49 % for a 5 year fixed,
variable rate mortgages from as low as p-.85%
Prime Rate is 3.20%

*High Ratio/Quick Close Specials
This is a critical time to sit down and review your household financing needs. Please do not hesitate to contact me should you have any questions.

If you are in the market for a home, book an appointment today to see how the recent regulatory changes by the Office of Superintendent of Financial Institutions will affect your purchase.

**rates subject to change with market conditions – *OAC  **conditions apply E. & O. E.

Terms Bank Rates Our Rates
6 Month 3.14% 3.10%
1 YEAR 3.04% 2.89%
2 YEARS 3.24% 2.54%
3 YEARS 3.44% 2.64%
4 YEARS 3.89% 2.84%
5 YEARS 4.99% *2.84 – 3.49 %
7 YEARS 5.30% 3.44%
10 YEARS 6.10% 3.74%
Rates are subject to change without notice. *OAC E&OE
 **Please note that rates shown above are subject to change without notice. The rates shown are  posted rates and the actual rate you receive may be different, depending upon your personal financial situation. “Some conditions may apply. Rates may vary from Province to Province. Rates subject to change without notice. *O.A.C. E.& O.E.”
10 Nov

How will the new mortgage qualification restrictions affect you? NDLC Monthly Mortgage Newsletter.

General

Posted by: Anne Martin

Welcome to the November issue of my monthly newsletter !

This month’s edition discusses what the Bank of Canada is (not) up to, and more importantly what the Federal Government is implementing Jan 1.   Also look for a short note regarding maternity or paternity leave while shopping for a new home or renewing your mortgage on an existing home.

Please let me know if you have any questions or feedback regarding anything outlined below.

Thanks again for your continued support and referrals!

Bank of Canada – Back on Hold

On Oct. 25, the Bank of Canada made no change to the overnight lending rate.

This lack of movement was widely expected, then again the Bank of Canada surprised 27 of 33 economists polled with the previous 0.25% rate hike on Sept 6, following a previous 0.25% hike July 12. At this point cooler heads are prevailing.

These two recent increases should be viewed with the consideration that the last time the Prime rate reached a level this ‘high’ was September 2010, where it then sat stagnant for more than four years. Until a shock to the system triggered two 0.25% drops in early 2015. A response to the sudden drop in oil prices.

Shocks to the system often cause rates to drop, the unexpected.

What will cause rates to continue to rise in the future? Economic good news, which is something that tends to build in a predictable and slower fashion. Interest rates are unlikely to rise significantly anytime soon; they are also likely to increase gently and slowly when they do so. Just as they have thus far.

The net effect of the two increases in 2017 is a return to a previous high set in 2010; a ‘high’ that remains a remarkable historical low.

The next Bank of Canada meeting is set for Dec. 6 and at this point, few experts are anticipating a rate increase.

Wondering about locking in that variable? Act with caution, act with knowledge, and gather that knowledge from multiple sources, including a conversation with me.

Restrictions On Mortgage Qualification

When – Jan 1st, 2018 – Lenders may adopt new policies sooner due to the date selected

Who is affected by these upcoming changes?

#1 Nobody renewing an existing mortgage.

#2 Nobody purchasing a home with LESS than a 20% down payment.

OK, so who then?

People with more than 20% to put down on a new purchase, or with more than 20% equity in their home.

Yep, the group that represents the absolute lowest risk to market stability. You may have amazing credit, a great income, and 20% or more down…but you will have your mortgage maximum cut by a solid 20% over where it has stood for the past twenty years or so.

Is this a big deal? Yes and No.

No, because the majority of Canadians rarely borrow 100% of their maximum. The group hitting their maximum tend to be the same group that has LESS than 20% to put down and that group was addressed by the government last October.

In other words the impact of these rules will be small overall…mostly.

Yes it is a big deal though, specifically for the small number that will be directly impacted, these changes will feel like the cold and devastating slap in the face they are.

This is being done in the face of a track record of statistics decades long that shows homeowners with greater than 20% equity represent just about as close to zero foreclosures as can be imagined.

In other words, the group impacted is not one that needed ‘stabilizing’ or restrictions. These are people already self-regulating to a great extent. After all, that is how they got the 20% equity and the excellent credit and income required for that maximum amount in the first place.

What does this mean for the market? Is a meltdown imminent?

No.

Again, this is a small number of people affected. Albeit a small group impacted in a massive way if you were to ask them.

In particular these changes are unlikely to have any impact of note on the already flattening and softening Vancouver or Toronto markets. This is due to higher than average homeowner household incomes in these cities.

However small town Canada, where the impact of last year’s ‘stress test’ for buyers with less than 20% down has had a big negative impact. could well feel yet another wave of negative price pressure. Something that will displease many existing homeowners, and as the price softening is unlikely to be significant enough to please prospective buyers, basically nobody will be pleased.

To be clear, these changes were made by the Office of the Superintendent of Financial Institutions (OSFI) and OSFI’s mandate is specifically ‘to protect the stability of the CDN banking system’.

These changes are not about creating affordable housing, addressing consumer debt, stopping bidding wars, slowing condition free offers, or runaway property prices, etc. If you are concerned about these changes affecting your own financing abilities please contact us immediately, we can still take action well before the Jan. 1, 2018 deadline.


Did you know…
Often the impending arrival of a new addition triggers thoughts of other changes in our lives. We often decide that a larger vehicle and/or larger living quarters are in order. And we are perhaps unaware of the impact increased payments can have on mortgage qualification.

There are a few key points around mortgages and new debt additions.

1. The monthly payment on a leased or financed car can have a significant negative effect on mortgage qualification. Housing first, vehicles second.

2. Being on maternity or paternity leave while shopping for a home is not a showstopper. The key is a job letter that clearly defines a return to work date, i.e., you have a full-time income position to return to.

3. Being on maternity or paternity leave, or even having a new car payment in your life will not affect your ability to renew your mortgage with your current lender, although it can make moving to a new lender more difficult.

Before adding a car payment, before listing your current residence for sale, give us a call.

As always, I’m here to help!

3 Nov

Are you prepared for the next round of new mortgage rules?

General

Posted by: Anne Martin

Anyone who has 20% or more equity in their home or planning to use more than 20% down payment on a home purchase after January 1, 2018, may qualify for a smaller mortgage than they did before that date.  This is a result of the latest changes in mortgage rules determined by the Office of the Superintendent of Financial Institutions (OSFI).

The governments new stress test will apply to all federally regulated banking institutions and will affect all conventional mortgages (more than 20% down payment or equity), including refinances, renewals and purchases.  If you are buying a home using less than 20% down payment, you will still pay mortgage default insurance(CMHC, Genworth or Canada Guaranty)  and qualify at the benchmark rate, currently 4.99% for most institutions.

No need to panic regarding your mortgage renewal.  You won’t have to requalify at renewal time unless you make changes, such as moving it to another institution or increase the amount, etc.  If you don’t qualify, your only choice may be to keep what you have and accept whatever is offered by your current lender.

At this time, it appears that provincially regulated financial institutions are not included.  ie credit unions.

It appears that applications submitted to lenders prior to January 1, 2018 will be honored under the old rules.  We are still waiting for further clarification from the government.

An important point is that many lending institutions have begun implementation early as requested by OSFI.

These changes may also greatly affect debt consolidations considering that you may not be able to refinance your home for as much as needed to pay out those high interest rate loans as you would presently be able to.

If you are considering a mortgage refinance, debt consolidation or purchase, you should consider talking with a mortgage professional as soon as possible.

Robert McLister of Ratespy wrote an excellent article in the Globe and Mail explaining further.  Please see the attached. Preparing for OSFI

 

2 Nov

New mortgage rules heat up Toronto. Mortgage Market Update November 2, 2017

General

Posted by: Anne Martin


New mortgage rules expected to heat up Toronto housing before winter chill    The sales slump in Toronto real estate is persisting into the fall, but average annual prices across the region are holding up thanks to double-digit price gains in the condo sector.      Find out more


Best fixed rates are as low as *2.84 – 3.49 % for a 5 year fixed,
variable rate mortgages from as low as p-.85%
Prime Rate is 3.20%

*High Ratio/Quick Close Specials
This is a critical time to sit down and review your household financing needs.  Regulatory changes may have a direct impact on your ability to refinance your mortgage or purchase a home. Please do not hesitate to contact me should you have any questions.

If you are in the market for a mortgage, contact me today to see how the recent regulatory changes by the Office of Superintendent of Financial Institutions will affect your purchase.

**rates subject to change with market conditions – *OAC  **conditions apply E. & O. E.

Terms Bank Rates Our Rates
6 Month 3.14% 3.10%
1 YEAR 3.04% 2.89%
2 YEARS 3.24% 2.54%
3 YEARS 3.44% 2.64%
4 YEARS 3.89% 2.84%
5 YEARS 4.99% *2.84 – 3.49 %
7 YEARS 5.30% 3.44%
10 YEARS 6.10% 3.74%
Rates are subject to change without notice. *OAC E&OE

 **Please note that rates shown above are subject to change without notice. The rates shown are  posted rates and the actual rate you receive may be different, depending upon your personal financial situation. “Some conditions may apply. Rates may vary from Province to Province. Rates subject to change without notice. *O.A.C. E.& O.E.”

Check with your Dominion Lending Centres Mortgage Professional for full details and to determine what rate will be available for you.