Category Archives: Blog

CMHC on Track to Profit another Billion

CMHC released its second quarter results on Wednesday reporting a quarterly profit of $255 million.  The crown corporation is well on its way to generating another $1 billion in annual profits.  The Canadian government doesn’t usually do well running profitable businesses, but this is one cash cow that we’d be foolish to privatize. Mortgage insurance claims for the quarter were $168 million, up from $144 million in the same period … Read More

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Scotiabank Buys ING Direct

After a short time on the auction block ING Direct has been gobbled up by Scotiabank for a reported $3.1 Billion.  It’s the largest transaction in Scotiabank’s 180 year history.  Although many of Canada’s big banks were interested in the transaction, Scotiabank was the hungriest to acquire its $30 billion of deposits.  On the heels of the announcement Scotiabank published a high profile letter reassuring ING Direct customers that it … Read More

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Bank Profits Jump Despite Negative Rhetoric

Scotiabank’s profits skyrocket 57% while Bank of Montreal’s profits launch 37% higher in the third quarter.  If anyone was concerned about our Canadian banks’ well-being, they should be consoled by these numbers.  With net income increasing to $2.05 billion and $970 million respectively these solid performing institutions are well positioned to weather the worst of storms regardless of what the doomsayers preach. These results are one more reason why Canadians … Read More

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Less Affordable Housing

Canadian housing became a little less affordable last quarter according to a report released today by RBC.  “This represented the second consecutive quarter during which the costs of owning a home at market prices grew as a share of household income” read the report authored by RBC economists Craig Wright and Robert Hogue. The main factors affecting affordability are rising home prices, higher mortgage rates and tighter lending rules, and … Read More

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The Fastest Way to Improve Your Credit

A good credit score can open many doors, while a bad score will shut them tight.  A poor credit score will not only prevent you from getting the best mortgage rate, it may prevent you from getting approved at all. Credit scores are controlled by Equifax and Trans Union.  These 2 firms each maintain your credit record itemizing your payment history on each credit card, loan and line of credit.  … Read More

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Banks Raise Mortgage Rates

TD Canada Trust announced today that its raising interest rates on its 3 and 5 year fixed term mortgages.  This announcement comes on the heels of a similar RBC announcement earlier this week.  RBC is increasing its 3 and 5 year fixed mortgage rates by 0.20% as well as its deep discounted 5 year fixed mortgage rate from 3.49% to 3.69%.  TD made similar changes to it’s 3 year fixed … Read More

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Porting Your Mortgage

The ability to port your mortgage is a common mortgage feature that has come to be expected by most Canadians.  On the face of it, the concept seems straightforward, but the details may prevent you from keeping your rate or eliminating your mortgage penalty.  Make sure you understand your lender’s policies. The main benefits of porting your mortgage are the elimination of pre-payment penalties and the ability to keep your … Read More

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Variable Mortgage Rate Forecast – August 2012

The Bank of Canada (the “Bank”) sets the overnight lending rate which directly impacts the mortgage prime rate.  Although the Bank has a broader agenda than just controlling the mortgage prime rate, this motive has been in the spotlight due to the Bank’s desire to deleverage Canadian borrowers.  Despite some upward rate pressure to cool the housing market there has been no change to the prime mortgage rate all year.  … Read More

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Fixed Mortgage Rate Forecast – August 2012

Over the past 30 days we’ve seen the 5 year Government of Canada benchmark bond yields edge up 0.20% to a 30 day high of 1.43% as of yesterday.  This bond yield represents the cost of funds for 5 year fixed mortgage rates and as such has squeezed the profit from mortgage lenders.  Although there haven’t been any Canadian mortgage rate increase announcements we have seen the evaporation of some … Read More

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ING Direct Up For Sale

The Dutch based mega bank ING is putting its Canadian operations up for sale with the likely buyer being one of the existing big 6 Canadian banks.  The large Canadian banks have the means and the expertise to make the most of this profitable business.  The biggest advantage of such a transaction would be lower transaction costs through greater economies of scale, but that would only apply if they could … Read More

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