Mortgage rates are going up despasito

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Mortgage Rates Are Going Up DespASITOIn the past couple of weeks since the Bank of Canada publically increased the interest rate to 0.75% from 0.50%, we have been notified of by our numerous lenders that their mortgage rates are going up “despasito”, (slowly).

The increase have affected immediately to those borrowers who had a variable rate mortgage, and then to those who are applying for new mortgages either for purchase or refinance purposes and in both variable and fix rate mortgages.

The rate increase effect has been felt also in an increase of mortgage applications as the escalating homeselling price has been not only slowed down but actually reduced in some markets in Ontario.

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1-2-3 Mortgage application

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1-2-3 Mortgage application

1-2-3- Mortgage applicationThe simplest, quicker and most secure online mortgage application is here for you now.

Now is as 1 2 3 to apply to get the funds you need.

Simplest personalized & secure link form you will fill

Your secure personalized link takes you to a most secured application that you fill from the comfort of your home, then get the good news right there.

We care, apply now

Apply Online

New qualifying federal mortgage rules changes

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New qualifying mortgage rulesNew qualifying federal mortgage rules changes

On October 3rd, Bill Morneau, Minister of Finance announced “Preventative measures for healthy, competitive and stable housing market”. The intention is to address the growing household debt and rapidly rising house prices.

Learn about the new qualifying federal mortgage rules changes that will affect your mortgage affordability during the qualification process and what can you do to qualify for that mortgage that you are seeking

The new rules affect the CMHC insured and Low Ratio Bulk Insured Mortgages.

These new rules might definitely affect the housing market as intended, affecting also a through the qualification process a great number of borrowers with intentions to purchase a home or to renew their current mortgage.

How are these changes affecting you as a borrower and most important what can you do right now to avoid negatively affected?

The following links explain both affected types of mortgages Select the type of mortgage that you would need to purchase of to refinance your current.

What kind of mortgage do you need information about?

For new home buyers, new mortgage rules select according to the amount of your downpayment. Under 20% down payment = high ratio mortgage. Over 20% down payment = low ratio mortgage

New rules high ratio mortgageHigh ratio (less than 20% of downpayment) home purchase or refinance
New rule low ratioLow ratio (more than 20% of downpayment) home purchase or refinance

You can also apply on line now or Call or text 416-262-7139 and request a confidential one on one meeting to look at specific answers and help you get the best mortgage deal.

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New rules affecting low ratio mortgages

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New rules low ratio mortgageNew rules affecting low ratio mortgages

The new rules affecting low ratio mortgages or mortgages backed by portfolio insurance are effective from November 30th, 2016.

The following are new mortgage rules for low ratio mortgages, (Over 20% down payment = low ratio mortgage)

The new refinancing rules have been postponed to start taking effect on May 1, 2017,

New eligibility requirements for low-ratio mortgages to be insured will include:

  • A loan whose purpose includes the purchase of a property or subsequent
    renewal of such a loan;
  • A maximum amortization length of 25 years;
  • A maximum property purchase price below $1,000,000 at the time the loan
    is approved;
  • For variable-rate loans that allow fluctuations in the amortization period,
    loan payments that are recalculated at least once every five years to
    conform to the original amortization schedule;
  • A minimum credit score of 600 at the time the loan is approved;
  • A maximum Gross Debt Service ratio of 39% and a maximum Total
    Debt Service ratio of 44% at the time the loan is approved,
    calculated by applying the greater of the mortgage contract rate or the Bank
    of Canada conventional five-year fixed posted rate; and,
  •  A property that will be owner-occupied.

A benchmark test rate will be applied to qualify.

Scenario:

A $500,000.00 mortgage at an annual benchmark rate of 4.64% (This is a test rate) on a 25 years amortization will require a monthly payment of $2,806.41

A $500,000.00 mortgage at an annual contracted rate of 2.39% on a 25 years amortization will require a monthly payment of $2,212.53. (This would be the real payments)

What should you do at this moment?

There is no one single financial move as each borrower has different needs and different circumstances,  however with you should apply on line now or call or text 416-262-7139and request a confidential one on one meeting to look at specific answers and help you get the best mortgage deal. Delays to take action may cost you! Don’t delay!

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New rules affecting high ratio mortgages

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New mortgage rules high ratioNew rules affecting high ratio mortgages

The new rules affecting high ratio mortgages are effective from October 17th, 2016.

The following are new mortgage rules for high ratio mortgages, (under 20% down payment = high ratio mortgage).

From October 17th, 2016 onwards all borrowers (including those seeking a mortgage with a 5 year or longer fixed rate, insured mortgage with a variable rate, fixed under 5 years term) will need to qualify at the benchmark rate set by the Bank of Canada (currently at 4.64%) even if the mortgage loan will carry a lower mortgage rate. The monthly payments will consider the agreed rate (not the 4.64% benchmark rate)

Scenario:

A $500,000.00 mortgage at an annual benchmark rate of 4.64% (This is a test rate) on a 25 years amortization will require a monthly payment of $2,806.41

A $500,000.00 mortgage at an annual contracted rate of 2.39% on a 25 years amortization will require a monthly payment of $2,212.53. (This would be the real payments)

Simply put: Well qualifying borrowers that before the new rules were able to qualify for a certain amount mortgage, will qualify for a lesser amount mortgage after October 17th, 2016 when the new rules take effect.

The periodic payments maybe the same amount as they are factoring the loan amount, the contracted mortgage rate and the amortization period, once the mortgage is approved.

What can you as a borrower interested in a mortgage do now?

  • Increase considerably your down-payment.
  • Increase your qualifying income.
  • Look for an alternative property.
  • Try to keep your debt low and your credit high.

As of October 17, 2016, all insured mortgages regardless of the term must be qualified at the Bank of Canada Benchmark rule (currently at 4.64%)

What should you do at this moment?

There is no one single financial move as each borrower has different needs and different circumstances,  however with you should apply on line now, call or text 416-262-7139and request a confidential one on one meeting to look at specific answers and help you get the best mortgage deal. Delays to take action may cost you! Don’t delay!

The new refinancing rules have been postponed to start taking effect on May 1, 2017,

Do you have questions or need assistance with your mortgage?

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A Co-signer story

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A co-signer story Considering co-signers to help your mortgage may be a very smart thing to do in regards to money-saving, however, this advantage may come with some potential risks that may end up consuming some of those savings or even worse, potential legal conflicts.

A good family that I know wanted to buy a house to stop renting, they had been renting for a long while and they wanted to start owning, however, their income was insufficient to prove affordability to a lender that they would be able to repay the requested mortgage. They have saved for their down payment, their credit was ok, It was only the insufficient income.

They approached a good friend in whom they trusted enough to ask to help them being a co-signer so that they could qualify to purchase the home for their family. He would need to commit to their mortgage obligations and responsibilities, except that he wouldn’t be paying the monthly mortgage payments unless the couple couldn’t make them.

The family was able to qualify and purchase their home, they were able to make the payments and live a better life, build some wealth and save more money than when renting. The co-signer was offered a very small percentage of the value of the property for the diligence of being included in the property title.

Suddenly, the good friend that was the father to a teenager passed away, this brought some complications and extra legal work and expenses to the family a couple of years after as they were planning to refinance their mortgage, and they needed to remove the co-signer from the title.

This is an example why it is wise to accept the mortgage protection plan offered with your mortgage.

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No fee refinance promotion

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Street Capital No Fee RefinanceIf you are looking to refinance your current mortgage this limited time promotion might help you save even further.

To optimize your savings, lower your borrowing cost, better your cash flow and most of all meet the financial goals you have set for the short and medium future, consider this not so common promotion that we have just received. It may come in the nick of time for you.

In this limited time promotion, the lender street capital takes care of the legal fees on your behalf when you choose a 5 years term refinancing mortgage, whether you choose a fixed or a variable rate.

The minimum loan amount, for this limited time promotion, is $250,000 and borrowers can refinance their mortgage at the competitive street capital mortgage rate.

Important benefits that you as a borrower need to consider if you are planning to refinance your current mortgage are:

  • Single point of contact at FCT (Who will service the legal process of your mortgage)
  • Expedited funding process
  • In-home signing appointment/notary office in BC

What this promotion includes is:

  • All discharges
  • All cancellations
  • Funding
  • One signing appointment
  • Payout of all secured and unsecured debts (Refinance)
  • Payout of current mortgage (Straight Insured Refinance)
  • Any applicable taxes
  • A title insurance policy in favour of the lender

FCT stands for “First Canadian Title”

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