There are dozens of mortgage calculators for Canadian mortgages. If you ever need to use one I recommend you try the ones on my company's website at www.mortgageconcierge.ca.
Specifically, I like the Mortgage Isolator calculator and the Mortgage Qualifier calculator.
When you start looking for a home it makes sense to play with these mortgage calculators a bit, and then to contact one of the mortgage professionals at our office. We can help people across Canada thanks to technology, and would be happy to help.
Warm regards,
Chris
--
Christopher Bisson
The Mortgage Centre
bisson.c@mortgagecentre.com
866-838-4366 x1003
Monday, January 31, 2011
Thursday, January 27, 2011
40 Year Mortgages Come to Roost
Hopefully you didn't "have" to take a 40 year amortization for your mortgage if you bought a house a couple of years ago. If you were, you've barely paid down your mortgage balance in the last 2 years.
Worse yet, you might have your heart set on a house that's for sale and are coming up to your closing date and you find out the vendor has a 40 year amortized mortgage. The challenge for you in this case is that it is VERY likely that there won't be enough money to pay off the mortgage and penalties for breaking the mortgage before the end of the term. This means that the vendor can't close the transaction and you'll be left looking for a place to live, and a place to store your boxes.
I am just in the middle of this situation with a great client who wants to buy a house. The vendor put very little down, has a long amortization, and when the early payout penalty is added into the mix they end up owing substantially more than the house is worth. They can't close.
If you are thinking of buying a house make sure your real estate agent has asked for proof that the mortgage on the vendor's house will not become an issue down the road. You can even ask your lawyer to do a search for you to find out how much of a mortgage was registered against the property when the house was purchased. For the $50.00 it could be the best money you spend for a long time!
Cheers,
Chris
--
Christopher Bisson
The Mortgage Centre
phone: 519-763-3900 x1003
toll free: 866-838-4366 x1003
www.mortgageconcierge.ca
Worse yet, you might have your heart set on a house that's for sale and are coming up to your closing date and you find out the vendor has a 40 year amortized mortgage. The challenge for you in this case is that it is VERY likely that there won't be enough money to pay off the mortgage and penalties for breaking the mortgage before the end of the term. This means that the vendor can't close the transaction and you'll be left looking for a place to live, and a place to store your boxes.
I am just in the middle of this situation with a great client who wants to buy a house. The vendor put very little down, has a long amortization, and when the early payout penalty is added into the mix they end up owing substantially more than the house is worth. They can't close.
If you are thinking of buying a house make sure your real estate agent has asked for proof that the mortgage on the vendor's house will not become an issue down the road. You can even ask your lawyer to do a search for you to find out how much of a mortgage was registered against the property when the house was purchased. For the $50.00 it could be the best money you spend for a long time!
Cheers,
Chris
--
Christopher Bisson
The Mortgage Centre
phone: 519-763-3900 x1003
toll free: 866-838-4366 x1003
www.mortgageconcierge.ca
Monday, January 17, 2011
New Mortgage Rules by Jim Flaherty
The Finance Minister, Jim Flaherty, revealed changes to mortgage lending rules that will see Ottawa stop backing home loans with amortization periods greater than 30 years and make it more difficult for households to use their property as an ATM.
The changes have emerged because of worries among leaders and the Bank of Canada about the record levels of household debt and how conditions could worsen unless action was taken.
“We want to make sure we don’t have the kind of medium-term problem that has been experienced elsewhere because of this tendency by some to assume large indebtedness at low interest rates,” Mr. Flaherty said in a statement. “People need to demonstrate that good Canadian trade of prudence and reasonableness in terms of their debt assumptions.”
The Finance Minister said mortgages with amortization periods longer than 30 years will no longer qualify for government-backed mortgage insurance, which is required for buyers with less than a 20% down payment on a home. The previous limit was 35 years.
The Government also lowered the maximum amount Canadians can borrow against the value of their homes from 90% down to 85% on a refinancing; and removed federal government backing for home equity lines of credit.
HELOCs are of particular concern and an key factor in the rise in household debt. Mr. Flaherty said some banks were insuring, through Canada Mortgage and Housing Corp. (CMHC), their exposure to HELOC liabilities and he wants to put an end to that situation.
“That’s particularly risky,” Mr. Flaherty said. “Some of those loans are not used to create housing in Canada. They are used to buy boats and cars and big-screen TVs. That’s not the business mortgage insurance was designed for.”
The changes will start being implemented on March 18th (maximum amortization to 30 years and refinances to 85%), and end on April 18th (no insured Lines of Credit).
This will have a small but definite impact housing prices, on the softening side, with some people looking to get into the housing market having to choose a smaller home. A little short-term pain for long-term stability.
Cheers,
Chris
--
Christopher Bisson
The Mortgage Centre
866-838-4366 x1003
www.mortgageconcierge.ca
The changes have emerged because of worries among leaders and the Bank of Canada about the record levels of household debt and how conditions could worsen unless action was taken.
“We want to make sure we don’t have the kind of medium-term problem that has been experienced elsewhere because of this tendency by some to assume large indebtedness at low interest rates,” Mr. Flaherty said in a statement. “People need to demonstrate that good Canadian trade of prudence and reasonableness in terms of their debt assumptions.”
The Finance Minister said mortgages with amortization periods longer than 30 years will no longer qualify for government-backed mortgage insurance, which is required for buyers with less than a 20% down payment on a home. The previous limit was 35 years.
The Government also lowered the maximum amount Canadians can borrow against the value of their homes from 90% down to 85% on a refinancing; and removed federal government backing for home equity lines of credit.
HELOCs are of particular concern and an key factor in the rise in household debt. Mr. Flaherty said some banks were insuring, through Canada Mortgage and Housing Corp. (CMHC), their exposure to HELOC liabilities and he wants to put an end to that situation.
“That’s particularly risky,” Mr. Flaherty said. “Some of those loans are not used to create housing in Canada. They are used to buy boats and cars and big-screen TVs. That’s not the business mortgage insurance was designed for.”
The changes will start being implemented on March 18th (maximum amortization to 30 years and refinances to 85%), and end on April 18th (no insured Lines of Credit).
This will have a small but definite impact housing prices, on the softening side, with some people looking to get into the housing market having to choose a smaller home. A little short-term pain for long-term stability.
Cheers,
Chris
--
Christopher Bisson
The Mortgage Centre
866-838-4366 x1003
www.mortgageconcierge.ca
Thursday, January 13, 2011
Canadian Dollar Flying High
The Canadian Dollar is flying again…that is to say we get more US Dollars per Canadian Dollar at the present time. This is good and bad news.
First the bad news: for Ontario and Quebec, whose economies are largely manufacturing and (USA) export driven, it means it will be harder for them to compete as their products will be more expensive compared to US based manufacturers. This does not bode well for people in the automotive industry and might indicate that fewer people will be called back to work than originally expected.
The good news is twofold: 1) With the stronger dollar it is less expensive for our companies to buy capital equipment that can make them more productive. The more productive we get the less expensive our goods can become and/or the larger the profits our companies can make. Profitability and efficiency are the cornerstones to a company’s long term health. 2) The strong CDN dollar means the companies that are commodity suppliers will see a strong future. No matter where a company makes its products, they will need the raw materials that go into them. Canada is a worldwide supplier of commodities, so watch for the western provinces to have a great year.
The result for real estate is that it will do will out west this year, while central Canada will see flat prices.
Mortgage rates are expected to rise this year, but don’t expect them to jump up too much.
Call me if we can be of help to you.
Warm regards,
Chris
--
Christopher Bisson
President and Mortgage Broker
The Mortgage Centre
519-763-3900 x1003
www.guelphmortgagecentre.com
First the bad news: for Ontario and Quebec, whose economies are largely manufacturing and (USA) export driven, it means it will be harder for them to compete as their products will be more expensive compared to US based manufacturers. This does not bode well for people in the automotive industry and might indicate that fewer people will be called back to work than originally expected.
The good news is twofold: 1) With the stronger dollar it is less expensive for our companies to buy capital equipment that can make them more productive. The more productive we get the less expensive our goods can become and/or the larger the profits our companies can make. Profitability and efficiency are the cornerstones to a company’s long term health. 2) The strong CDN dollar means the companies that are commodity suppliers will see a strong future. No matter where a company makes its products, they will need the raw materials that go into them. Canada is a worldwide supplier of commodities, so watch for the western provinces to have a great year.
The result for real estate is that it will do will out west this year, while central Canada will see flat prices.
Mortgage rates are expected to rise this year, but don’t expect them to jump up too much.
Call me if we can be of help to you.
Warm regards,
Chris
--
Christopher Bisson
President and Mortgage Broker
The Mortgage Centre
519-763-3900 x1003
www.guelphmortgagecentre.com
Sunday, January 9, 2011
USA Property for Sale
Many people talk about how cheap real estate is in the USA. Although there are many markets in the dumps, which will be there for quite a while, there are many markets performing well enough.
I recently spent time in Sedona, Arizona, and found the prices to be near the levels they were 2 years ago. They are a little lower mind you, but they aren't 40% less than they were in 2006.
So while the prospects of getting a good deal on property in the USA are still fairly strong you need to do your homework before jumping in. In fact, if you haven't thought of it, maybe a timeshare is better suited to your purposes. Check into it as it gives you the opportunity to visit many cities and continents, without the property taxes, maintenance, etc.
If you are looking for rates and options don't hesitate to give someone at my office a call. No matter where you are in North America you can reach us at 1-866-838-4366.
Happy New Year,
Chris
--
Christopher Bisson
President and Broker of Record
The Mortgage Centre (Guelph)
343 Waterloo Ave,
Guelph, ON, N1H 3K1
www.mortgageconcierge.ca
I recently spent time in Sedona, Arizona, and found the prices to be near the levels they were 2 years ago. They are a little lower mind you, but they aren't 40% less than they were in 2006.
So while the prospects of getting a good deal on property in the USA are still fairly strong you need to do your homework before jumping in. In fact, if you haven't thought of it, maybe a timeshare is better suited to your purposes. Check into it as it gives you the opportunity to visit many cities and continents, without the property taxes, maintenance, etc.
If you are looking for rates and options don't hesitate to give someone at my office a call. No matter where you are in North America you can reach us at 1-866-838-4366.
Happy New Year,
Chris
--
Christopher Bisson
President and Broker of Record
The Mortgage Centre (Guelph)
343 Waterloo Ave,
Guelph, ON, N1H 3K1
www.mortgageconcierge.ca
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