Tag Archives: mortgage rules

Flaherty Slams on the Brakes

The issue of Canadian debt levels has found a permanent place in the news.  Specifically, increasing levels of consumer debt is being cited as the reason for Jim Flaherty’s need to tighten mortgage rules yet again this summer.  With Canadian debt to income ratios approaching US pre-crash levels there’s been much panic that a US style Real Estate crash is coming to Canada. The primary reason for higher debt levels … Read More

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Mortgage Rules Squeeze Out First Time Buyers

Canada’s Minister of Finance, Jim Flaherty, has tightened mortgage rules 4 times in as many years.  The objective was to slow down the housing market and to keep Canadians from racking up too much debt.  Speaking on CBC radio this past weekend, Mr. Flaherty indicated that no more rule tightening will be done.  “We’ve done enough, I do not intend to do any more” Mr. Flaherty announced on the radio … 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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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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The Real Estate Divide

Canadians have always been proud of our capitalist society with a strong middle class.  As we gain wealth nationally we’ve improved the standard of living of all our income bands.  We’ve avoided the great divide between the rich and the poor that exists south of the boarder.  The new economy however threatens all of that. Our elected officials are governing us as if we all have the same net worth … Read More

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CREA Cuts Forecasts

The Canadian Real Estate Association (CREA) cut its home sales forecasts for 2012 and 2013 and lowered its national average price predictions in a report issued earlier today. The new forecast eliminates 8,900 transactions from the previous 2012 forecast, but still calls for growth of 1.9% over 2011.  Of bigger concern is the 1.9% reduction in transactions forecast for 2013 bringing us back two years to the 2011 activity of … Read More

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Strong Loonie Keeps Mortgage Rates Low

The Canadian dollar rallied to a 13 month high against the US greenback on news that the Federal Reserve plans to purchase bonds.  The US central bank indicated that it would maintain interest rates near 0.0% until 2015 and begin buying mortgage securities to fuel economic growth.  That announcement spurred investors to dump low yielding US assets in favour of more lucrative Canadian investments.  One Canadian dollar buys $1.03638 US. … Read More

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Toronto Housing Prices Climb Out of Reach

In a report issued late last week, the Toronto Real Estate Board (TREB) announced that Toronto real estate prices were up 6.5% for the month of August compared with the same month last year.  The price growth was primarily driven by the low rise segment of the market which grew at an annual rate of 15%. 15% price appreciation is a crazy rate of growth especially given the predictions of … 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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