Author Archives: Dan

Dan

About Dan

Dan Wowk has over 20 years experience in the financial services industry with a focused expertise in the residential mortgage market. Dan's accomplished career includes an MBA from the Schulich school of business, and roles ranging from vice president of Canada's largest mortgage bank to running an independent brokerage. Dan believes in sharing his expertise with the Canadian consumer to improve their financial well being. Knowledge is Power. Be Powerful!

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Let the Mortgage Rate Wars Begin

The clear sign of a mortgage rate war is when Bank of Montreal (BMO) starts advertising a 2.99% 5 year fixed mortgage rate.  Although current bond yields don’t support such a low mortgage rate we are entering the critical spring season that can make or break a bank’s annual lending target. The tightened mortgage rules have done their job and pushed many potential buyers out of the market and scared … Read More

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Variable Mortgage Rate Forecast – February 2013

Variable mortgage rates are tied to your banks prime lending rate which is in turn tied to the Bank of Canada’s overnight rate. Now that Mark Carney has pledged to not raise the overnight rate for at least a year it’s made my job of rate forecasting considerably easier. Variable mortgage rates aren’t going up! Having said that, economic conditions can change and I will continue to check in on … Read More

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House Flipping Clause in Reverse Mortgage Stops Momentarily till 2014

Though momentary, the flipping regulation that had come to be in the circles of the Federal Housing Administration’s (FHA) rulebook will bear positively, for now, on those seeking to acquire financing for property that is, according to the rule, too tender to avail. The clause has gone under hiatus until the end of 2014 when it will, perforce, come back to life to hinder applicants after homes that have gone … Read More

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Bank of Canada Finally Admits Rates to Remain Low

In a speech at the Richard Ivey School of Business, Mark Carney admitted that the benchmark interest rate would remain at its current low of 1% into 2014.  While it’s been painfully obvious to industry players that the Bank of Canada (BOC) could not raise interest rates due to the serious negative consequences, Mr. Carney and the BOC had been threatening rate hikes for most of 2012.  This empty threat … Read More

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Fixed Mortgage Rate Forecast – February 2013

The Government of Canada benchmark 5 year bond is currently yielding 1.40%.  It’s current position is in the middle of the previous 12 month range where the high hit 1.74% and low hit 1.06%.  Its future path is expected to stay within the same range over the next several months.  While bond yields represent mortgage lending costs it’s not the only factor determining 5 year fixed mortgage rates. Competitive pressures … Read More

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S&P Ratings Questionable

S&P has made questionable ratings over the past few years, putting into doubt their value and purpose.  A recent downgrade of Canada’s big banks is the most recent example of how out of touch they can be with their ratings system.  It’s 2011 downgrade of the US government was farcical at best and interpreted by many as more of a political statement than a risk rating. It seems that the … Read More

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Pennies Stop Shipping Today

As of today the Royal Canadian Mint stopped shipping pennies to retail stores and banks.  The death of the penny was announced nearly a year ago in the federal budget.  The Mint actually stopped producing the penny last May, but it wasn’t until today that the supply actually stopped. The federal government has given retailers flexibility in their rounding calculations, but has provided guidelines that the majority of retailers will … Read More

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Carney Confirms Continued Low Rates – Finally!

On Tuesday, the Bank of Canada held the overnight rate at 1.0% for the 27th consecutive month.  This came as no surprise to anybody, but what was a surprise and equally refreshing was Mark Carney’s confirmation that interest rates would remain low well into 2014. For the past 27 months the Bank of Canada didn’t touch the overnight rate, but kept threatening to raise rates soon.  As the Dread Pirate … Read More

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Canada Guaranty Buys Market Share

Canada Guaranty, the mortgage insurer you never heard of, is gaining momentum in the mortgage industry.  What’s interesting is that they are actually paying the banks to send them business.  According to Royal Bank’s own disclosure document, they receive $140 for every mortgage closed and insured with Canada Guaranty.  As long as this fact is disclosed and the mortgage insurance is equal to that offered by CMHC and Genworth then … Read More

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The New ING is Emerging

ING Direct announced today that it will no longer be accepting mortgage applications from mortgage brokers.  This change is a direct result of Scotiabank’s 2012 acquisition of ING Direct and is spelled out in a letter to mortgage brokers “Following the recent acquisition of ING Direct by Scotiabank we have completed a thorough evaluation of our mortgage business and have come to the decision that ING Direct will concentrate its … Read More

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