Tag Archives: mortgage policy

Know Your Reasons Why!

We all have goals in life.  Some we write down, others we keep at the back of our mind.  Nonetheless, we all have a future vision to which we aspire.  Whether, it’s to lead a healthier life, to meet the love of your life, to travel to an exotic locale or to simply pay off that darn mortgage, if it’s important enough to you, you will achieve it. Achieving your … Read More

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Toronto Residents Forced to Rent

The Department of Finance seems to be getting its wish of reducing the amount of mortgage debt, but is it in the best interest of Canadians?  MLS data revealed that the number of Toronto condos leased in the first quarter of this year soared by over 31 per cent compared to the same period last year.  Alternatively, the number of new Toronto condos sold in the first quarter of this … Read More

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Non-Mortgage Debt Still Rising

In a report released last week, Equifax revealed that consumer indebtedness increased year over year by 3.9% to $500.8 billion.  Now that we have fewer home refinance options, balances are increasing for bank installment loans, lines of credit and auto loans.  Although modest increases are to be expected, a 3.9% increase is almost double our economic growth rate. Mortgage debt, which is normally considered the only good debt has been … Read More

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Can You Afford a Home?

The Minister of Finance is concerned that too many Canadians are buying a home even though they shouldn’t.  His concern is that unqualified homeowners will eventually default on their mortgages bringing down the market and the economy in an American style collapse. This is a valid concern and the message has made its way to the Canadian public.  A recent survey conducted by Maritz Research for CAAMP show that a … Read More

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Flaherty Tells Bank to Raise Mortgage Rate

Jim Flaherty had one of his officials call Manulife Bank to voice his displeasure over their latest mortgage rate drop.  As a result, Manulife reversed a published rate drop to 2.89% for their 5 year fixed rate mortgage.  This unprecedented government intervention into the free market is a scary turn of events that threatens the principals on which our Country was built. Anti trust laws prohibit collusion among businesses including … Read More

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Non-Mortgage Debt on the Rise

Canadian non-mortgage related debt increased 4.6% in the fourth quarter over the same period last year bringing the average to $26,768, its highest point in 2 years.  This increase has many pundits scratching their heads trying to understand why Canadians aren’t getting the message.  Both the Bank of Canada and the Department of Finance have been so concerned about the amount of overall consumer debt that have been working to … Read More

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Self Employed Excluded From Home Ownership

Most Canadians are now familiar with the fact that mortgage rules have been tightened 4 times in 4 years by the Department of Finance.  What many don’t realize is that OSFI, the regulator of all Canadian Financial Institutions, is using its new found powers to tighten mortgage lending even further.  It recently imposed a new set of rules for mortgage lenders that’s been titled B-20. Perhaps the most restrictive component … Read More

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Appraisals Don’t Determine Purchase Price, the Market Does!

Constant government mortgage rule tightening and warnings of too much consumer debt has put property valuations and appraisals under a microscope.  Many critics are concerned that mortgage participants aren’t performing sufficient due diligence on a property’s value, and are contributing to escalating values and debt. The truth is neither a lender nor an appraiser can decide a property’s value.  That decision is left up to market forces.  The definition of … 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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