Tag Archives: Mortgage Broker

What To Do When Housing Prices Fall

It appears as though the seemingly infinite rise of Canadian housing prices has finally come to an end. After years of marvelling at record breaking list prices and historically low mortgage rates, the tides have finally shifted. Phrases like “cooling market” and “slow sales” are gracing national headlines, causing buyers and sellers alike to contemplate the repercussions.

If we’re to believe what the experts are saying, real estate in Canada has hit a tipping point. According to the Canadian Real Estate Association, sales are down a staggering 30 percent compared to last years numbers. What’s more, the average house price has dropped by roughly 3.5 percent since July.  Continue reading →

Consumer Debt Hits A New High

A report released this morning by TransUnion shows that, despite repeated warnings, Canadians are back on the borrowing bandwagon, pushing consumer debt to a new record high.

According to the report, the average Canadian’s non-mortgage debt hit $26,221 in the second quarter of 2012, up $192 from the previous quarter. This is the highest per person debt level since the credit bureau started tracking this type of data back in 2004.

The increase in average debt spanned the country, although Saskatchewan reported a slight dip on a quarterly basis and Alberta recorded a decreased annual debt growth. 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 →