Category Archives: Personal Finance

Are Non-Bank Mortgages Safe?

There are dozens of mortgage companies across the Country providing consumers with a broad array of choices.  Although there are only a small number of banks, they dominate the market due to their strong brand names and their vast branch networks.  But that doesn’t mean they’re better. Non-bank mortgage lenders offer mortgages with similar and sometimes better pre-payment privileges, features and benefits.  More importantly they often offer lower mortgage rates.  … Read More

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3 Tips to Boost your Credit Score

Having a good credit score is an essential part of not just getting a good mortgage rate, but also for qualifying for a mortgage in the first place.  If your score falls below 600 then some immediate action is needed.  Here are some steps you can take to boost you numbers. Make payments every month While this may sound like a no brainer some people don’t think that missing a … Read More

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Credit Score Determines Mortgage Rate

Your credit score is an essential component in qualifying for a mortgage and can determine your mortgage rate.   Main stream mortgage lenders are looking for a minimum credit score of 600.  Although an even higher score may allow you to qualify for a larger mortgage, it won’t get you a better mortgage rate. A score lower than 600 however will get you a significantly higher mortgage rate. Not only … Read More

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BMO’s 2.99% Mortgage Rate Eliminates another “Frill”

It came back with a twist.  The BMO 5 year fixed 2.99% no frills mortgage rate came back on the weekend, but was only available to on-line customers.  It initially caused quite a stir with the minister of finance because of concerns that it will lead to more consumer debt.  BMO’s retort was that their no-frills mortgage limits the amortization to 25 years so borrowers must pay-off their mortgage faster.  … Read More

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Ontario Land Transfer Taxes

Many home buyers are caught off guard when their lawyer tells them to bring in an extra $5,000 to close their purchase.  If they’re buying a home for $450,000 and putting 5% down then they are prepared for the $22,500 downpayment but can be surprised by the additional expenses.  These range from: Property tax adjustments Legal fees and disbursements CMHC premium tax Land Transfer tax Of these expenses, the land … Read More

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Freehold, Condo, Leasehold or Co-operative

When purchasing a home most buyers only distinguish between freehold and condominium.  This normally doesn’t pose a problem because 98% of land ownership is held in one of these 2 forms.  Some buyers will take title to their new home as leasehold or as a co-operative without knowing the facts and this could spell disaster down the road. Under leasehold ownership you typically take full ownership of the building, but … Read More

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Hidden Mortgage Fees

  If you’re like most borrowers you just want the best mortgage rate.  After all, aren’t the other terms the same?  Wrong. Banks and other mortgage lenders are businesses looking to maximize their profits and although there are regulations on stating fixed mortgage rates, the other terms are fair game and buyer beware. One example of a hidden fee is the reinvestment fee. This is similar to a restocking fee … Read More

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No More Cash Back Mortgages

The second significant mortgage rule change imposed by the Office of the Superintendent of Financial Institutions (OSFI) is the elimination of “Cash-Back” mortgages.  These mortgages offer the borrower a cash incentive or bonus once the mortgage closes.  The amounts are significant and usually represent 5% of the mortgage balance.  On a $300,000 mortgage this amounts to $15,000!  A much better gift than a new toaster. If it sounds too good … Read More

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HELOC Changes Imminent

One of the proposed mortgage rule changes coming down the pipe is lower limits on Home Equity Lines of Credit (HELOC’s).  Earlier this year the Department of Finance not only lowered maximum amortizations and restricted the limits on mortgage refinances, they also initiated several mortgage rule changes for federally regulated financial institutions.  Although many of the proposals were discarded, a couple of significant changes are nearing implementation, one of which … 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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