According to a recent TD Canada Trust survey, nearly 60 percent of Canadians were disappointed in the size of their down payment. These findings aren’t all that surprising; in a world of record-setting consumer debt, slim savings and lacklustre investment returns, saving for a sizeable deposit can seem like an exercise in futility. And yet, the bigger your down payment, the less interest you’ll pay, the easier it will be to refinance and you’ll enjoy lower mortgage fees. Continue reading
Category Archives: About Mortgage Brokers
RBC Increases Rates And the Argument for Smaller Lenders
The Royal Bank is the first of Canada’s big banks to hike rates, increasing two of its mortgages by one-fifth of a point each this morning. RBC’s posted rate for a three-year, fixed-rate mortgage has increased 0.2 percentage points to 4.05 while their special-offer rate for a five-year closed mortgage rose to 3.69 percent.
RBC is the first major commercial bank to increase their three-year mortgage rate since late January. Competitors are currently sitting at 3.95 percent. Data from the Bank of Canada shows that five-year conventional mortgages have held steady at 5.24 percent since May. Continue reading
HELOC Lending Limits On The Way?
Rumour has it that lending limits for home equity lines of credit (HELOCs) could be slashed come the end of this month. These moves, which relate to the Office of the Superintendent of Financial Institutions’ new mortgage underwriting guidelines, will limit federally regulated lenders to limit all new HELOCs to 65 percent loan-to-value, down from the current rate of 80 percent.
Canada’s big banks are required to comply with new guideline by the end of the fiscal year – October 31, 2012. However many lenders are already planning changes to take effect in September. Continue reading
Understanding Amortization
A shorter amortization period can help you pay off your mortgage faster and save you money. Obvious? Perhaps. So why are more and more people choosing to stretch their amortization as long as possible? The recent changes to Canadian mortgage regulations that limit amortization periods to 25-years have caused a bit of tension across the country as families scramble to manage increased payments.
However, at the end of the day, this restriction will go a long way to improving the pocketbooks of families from coast-to-coast. It wasn’t long ago that home hunters strove for shorter amortization periods in order to pay off their mortgage as soon as possible. As mortgage rules relaxed, so too did our dedication to frugality. Continue reading
Is a One-Year Fixed Rate Mortgage Right For You?
Rates have nowhere to go but up.
Or at least, that’s what everyone keeps telling us. Banks, economists, mortgage brokers, even Finance Minister Jim Flaherty is insisting that interest rates will start to climb later this year.
And yet, they keep going down. The mortgage establishment continues to drop interest rates, pushing long-term fixed mortgage rates like they’re going out of style. Which might be the case. With no clear sign of imminent rate hikes, borrowers are beginning to consider shorter term options in order to maximize their savings. Continue reading