Historically low interest rates are making it easier for Canadians to enter the real estate market. Why continue to rent when a mortgage payment could be less than your current monthly lease? If you’re considering the here and now, buying makes perfect sense. With the help of a seasoned mortgage broker, you can easily secure a best rate mortgage that’s cost-effective – but what happens when the market shifts and interest rates begin to rise? Continue reading
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Changes Coming for Mortgage Penalties
One of the easiest ways to ensure you’re getting the best mortgage rate around is to renegotiate your financing terms when interest rates are low. Which is great… except for one small problem: penalties. Banks are notorious for slapping borrowers with hefty penalties, especially those who are looking to wiggle their way out of a long-term fixed rate deal.
It used to be that borrowers could anticipate a penalty charge that amounted to approximately three months’ worth of interest at their current rate. Today, most lenders charge a penalty that is based on three factors:
- The current and past interest rates
- The outstanding balance
- The number of months left in the mortgage term
This is knowns as the Mortgage Rate Differential (IRD). Unfortunately for homeowners in search of a best rate mortgage, the IRD is now significantly higher than in the past thanks to rock-bottom interest rates. Continue reading
Canada’s Rate Stays at 1.00%
As expected, the Bank of Canada kept its key interest rate on hold last Thursday, even amongst growing concern over consumer debt. This rate has stood at a near record low of 1.00% since September of 2010 in an effort to boost economic growth. Nothing in the statement suggests a change in the rate anytime soon. In fact, the tone of the Bank’s official statement was relatively optimistic. Continue reading
Home Ownership Becoming More Affordable, Reports Show
Housing affordability appears to be improving in Canada, according to RBC’s quarterly numbers released on Wednesday. RBC’s chief economist, Craig Wright, believes that continued low interest rates this year will help keep housing prices and costs reasonable in the near term.
RBC’s report also showed that the financial burden of owning a home declined for the second straight quarter in 2011, thanks to “softer” home prices and higher household incomes. The report found that all categories of housing in the nation, including condominiums and two-storey family properties, have since risen on the affordability scale. Which is great for homeowners, but even better for home hunters. According to the Canadian Real Estate Association, the Canadian housing marketing is predicted to see a 0.3 percent increase in unit sales. Continue reading
Harper Government Makes Moves to Protect Consumers
The Harper government announced Sunday that it would be moving forward with several measures to help Canadian consumers achieve greater control over their own finances.
In a release posted to the Department of Finance Canada website, the Honourable Ted Menzies, Minster of State (Finances) and Shelly Glover, Parliamentary Secretary to the Minister of Finance, announced that measures would be taken to ban unsolicited credit card cheques, and that a shorter cheque hold period would be instituted later this year. It is believed that these changes will provide Canadian’s with more timely access to their own money. A new Mortgage Code was also announced. Continue reading