Canadian Mortgage Rates May Slide Down

Canadian 5 yr bond yield is at 2.34%. The spread, (based on the 5 yr rate published rate of 4.49%) has jumped far above the comfort zone at 2.15.

The banks dropped their posted rates by .10bps lasts week


The rate of return on the bond, can be read through a yield curve, If the increase in bond yield continues to go up, the spread will continue to shrink and this could be a trigger for interest rates to rise. Currently lenders are looking for a spread, between 1.50 and 1.75.

Toronto woman paying for mortgage fraud

This is too bad and we see it all the time. There is no free lunch. If you sign papers for a house and they pay you to do it is pretty much fraud and you pay the price.

Toronto woman paying for mortgage fraud

| Tuesday, 29 June 2010

A Toronto woman is being ordered to pay RBC $95,000 after failing to realize she was being tricked into a mortgage fraud.

Angela Isaacs accepted $6,000 to co-sign a stranger’s mortgage and signed the documents without reading them, reported the Toronto Star.

Madam Justice Anne Molloy of the Ontario Superior Court of Justice also decreed that Isaacs owes 6.3 per cent annual interest on the $95,000 loss from June 26, 2008 until the debt is paid and, within 30 days, $13,500 of the bank’s legal fees.

“She took the risk and got stung,” said Molloy during the ruling. “That is her own responsibility, not the fault of the bank.”

In late 2004, Isaacs was discussing her financial woes with her then common-law husband in a Tim Hortons coffee shop. She was earning $35,000 a year at a full-time job and raising three young children.

A stranger called Mike told her she could receive $4,000 for co-signing a mortgage for six months so a man with a poor credit rating could buy a house. Later Isaacs decided against it but was persuaded after she was offered $6,000.

Isaacs clued into the scam when RBC started sending her late payment notices for a $280,000 mortgage on a house she owned with a man supposedly named Mark Forrest.

Residential Mortgage Rates Lowered

We never talk about rates as not everyone can qualify for best rates and not all rates are for a mortgage you would want.
That said, below is a note on what the bank rates are. Our rates right now are:
  • 4.49% to 4.19% to 4.09% – depending on how long your rate hold is for  a  5 year fixed
  • 1.90% = Prime – .6% = 2.5%-,65=1.90% for a variable.
As you can see our regular rates are lower than the bank offers. AND our services are free for you as the banks pay us AND you work with the top team of Katie – an ex-bank underwritter, and me 1 of 3 MBA’s doing mortgages in Canada. Why go anywhere else?

Residential Mortgage Rates Lowered

TORONTO, June 24 /JAC/ – Residential mortgage rate changes as and when announced by major lenders.

TORONTO, June 24 /CNW/ – RBC Royal Bank announced today that it is decreasing its residential mortgage rates effective June 25, 2010.

The changes are as follows:

Fixed Rate Mortgages

  • Six-month convertible 4.85 per cent (decreased by 0.10 per cent)
  • One-year closed 3.60 per cent (decreased by 0.10 per cent)
  • Two-year closed 3.95 per cent (decreased by 0.10 per cent)
  • Three-year closed 4.50 per cent (decreased by 0.10 per cent)
  • Four-year closed 5.54 per cent (decreased by 0.10 per cent)
  • Five-year closed 5.89 per cent (decreased by 0.10 per cent)
  • Seven-year closed 6.85 per cent (decreased by 0.10 per cent)
  • Ten-year closed 7.00 per cent (decreased by 0.10 per cent)

Special Fixed Rate Offers*

  • Four-year closed 4.39 per cent (decreased by 0.10 per cent)
  • Five-year closed 4.49 per cent (decreased by 0.10 per cent)

* The rates indicated are special discounted rates and are not the posted rates of Royal Bank of Canada. To calculate a rate discount compare the Special Offer rate against the posted rate for the applicable term.

Special Offers may be changed, withdrawn or extended at any time, without notice. Not available in combination with any other rate discounts, offers or promotions.


For further information: Media contact: Gillian McArdle, (416) 974-5506

TORONTO, June 24 /CNW/ – TD Canada Trust has changed its mortgage rates, effective June 25, 2010.

The changes are as follows:

Fixed Rates To/Change:

  • 6-month convertible 4.75% – 0.10%
  • 1-year open 6.70% N/C
  • 1-year closed 3.80% – 0.10%
  • 2-year closed 4.30% – 0.10%
  • 3-year closed 4.85% – 0.10%
  • 4-year closed 5.54% – 0.10%
  • 5-year closed 5.89% – 0.10%
  • 6-year closed 6.20% – 0.10%
  • 7-year closed 6.59% N/C
  • 10-year closed 6.90% N/C

Special Fixed Rate Offers To/Change:

  • 1-year closed 2.80% – 0.10%
  • 4-year closed 4.39% – 0.10%
  • 5-year closed 4.49% – 0.10%
  • 7-year closed 5.25% N/C
  • 10-year closed 5.59% N/C


For further information: Tashlin Hirani, Media Relations, Corporate and Public Affairs, TD Bank Financial Group, (416) 982-3375

TORONTO, June 25 /CNW/ – CIBC (CM: TSX; NYSE) today announced the following changes in mortgage rates:

  • Six-month convertible 4.85 per cent, down 0.10 per cent
  • Six-month open 6.70 per cent, no change
  • One-year open 6.45 per cent, no change
  • One-year closed 3.60 per cent, down 0.10 per cent
  • Two-year closed 3.95 per cent, down 0.10 per cent
  • Three-year closed 4.60 per cent, down 0.10 per cent
  • Four-year closed 5.54 per cent, down 0.10 per cent
  • Five-year closed 5.89 per cent, down 0.10 per cent
  • Seven-year closed 6.95 per cent, down 0.10 per cent
  • Ten-year closed 7.00 per cent, down 0.10 per cent

These rates are effective Saturday, June 26, 2010.

Canadian Economy Gathering Steam

Canadian Economy Gathering Steam

TORONTO, June 22 /JAC/ – The Canadian economy is gathering steam, with Western Canada leading the way and all provinces participating, according to the Provincial Outlook report issued today by BMO Capital Markets Economics. Canadian growth is expected to reach 3.4 per cent in 2010 and 3.1 per cent in 2011, providing a strong rebound from the 2.5 per cent decline in 2009.

“Real GDP will likely expand across the country in 2010, with the strongest growth rates seen in Western Canada as commodity-sector activity recovers from a depressed year in 2009,” said Michael Gregory, Senior Economist, BMO Capital Markets, pictured top-left. “The theme of the ‘West Outperforming the Rest’ should persist into 2011 as global commodity demand remains firm, while a strong Canadian dollar tempers growth in Central Canada and capital investment activity begins to wane in Atlantic Canada.”

Highlights include:

Western Canada

• Western Canada is poised to benefit from a rebound in commodity prices, firming global demand for raw materials and a lower overall cost environment in the energy sector.

• Oil prices have more than doubled from their recession lows, and investment activity in Western Canada has started to pick up as a result.

• At the same time, reduced royalty rates in Alberta and various incentives in B.C. and Saskatchewan have helped improve the energy economics in the region, and have removed some of the political uncertainty surrounding the Alberta royalty regime.

• Meantime, Western Canada’s post-recession fiscal hole is much shallower than in Central Canada, and as a result, the impact on growth of budget-balancing measures will be milder in the coming years, allowing real GDP growth of about 4 per cent per year through 2011.

Central Canada

• The recovery is also well underway in Central Canada, as auto production has rebounded from the depths of recession, and Ontario’s housing market has roared back to see record sales and price levels.

• While housing is expected to cool through the rest of 2010, and the manufacturing sectors in Ontario and Quebec will continue to bear the weight of a strong Canadian dollar, domestic demand will pick up the slack.

• Indeed, retail sales have rebounded to record levels in both provinces, as have the number of service-sector jobs.

• However, longer-term growth in the region will be challenged by fiscal restraint—Ontario faces the largest budget deficit in the country and Quebec has already begun to implement tax increases and spending restraint.

• Taken together, these factors all point to below-average economic growth of slightly less than 3 per cent per year through 2011.

Atlantic Canada

• Atlantic Canada’s outlook remains stable.

• Aside from Newfoundland & Labrador (which was hit by some one-time factors), the region saw very modest real GDP declines in 2009.

• One factor supporting growth during the recession was capital investment in both the public and private sectors.

• While government stimulus remains strong in the region, some major private-sector projects will wind down in the next few years.

• This, combined with an ongoing challenge in the manufacturing sector, will lead to below-average growth of about 2.5 per cent per year through 2011 in Atlantic Canada.

Complete Report.

Alberta’s economy to rebound this year, lead nation in GDP growth

More good news on the economy that does not make the papers.

Alberta’s economy to rebound this year, lead nation in GDP growth

Oil sands investment boosts forecast of 4.1% spurt

CALGARY – Alberta will experience a significant economic rebound this year and lead the nation in GDP growth, says a report released today by Scotiabank.

The report forecast GDP growth of 4.1 per cent for the province while overall Canadian growth would be 3.6 per cent, the strongest advance in a decade for the country. In 2011, Scotiabank is forecasting Alberta economic growth at 3.4 per cent – tied with Saskatchewan for the best in Canada. Nationally, it is predicting Canadian GDP at 2.7 per cent next year.

Scotiabank said a strong pickup in investment will fuel growth in the energy and manufacturing sectors this year in Alberta.

“Investment has perked up in the oil sands, as easing costs and higher oil prices revived investment intentions in late 2009, with $2.2 billion in outlays scheduled for 2010 alone,” said the report. “Renewed activity in the industry will lead to significant benefits flowing through the economy, with manufacturing and services all heavily tied to conditions in the energy sector. While the bulk of investment will stem from oil sand development and tight oil plays, recent revisions to the province’s royalty framework are a major positive for the natural gas industry.”

© Copyright (c) The Calgary Herald

Buyers still enjoy exceptional rates

Buyers still enjoy exceptional rates

Memories of 22 per cent in early ’80s

By Marty Hope, Calgary HeraldJune 12, 2010

It’s far from panic, but there is concern in the marketplace regarding resale housing — and much of this concern is around rising mortgage rates at a time when selling prices are in flux.

I’ve said this before and I’ll say it again: homebuyers today have it exceptionally good when it comes to mortgage rates.

I moved to Calgary and bought in the early 1980s when mortgage rates were something like 22 per cent. Try that on for size — and compare it with what the rates are today, even after they moved off the historic bottom.

Then there was the commentator I heard on TV the other night saying the latest movement would add just $20 per month per $100,000 to the monthly mortgage.

Granted, there will be some who will find it difficult to cope with that marginal increase, but for most it’s easily covered.

And yes, the overall average price reported by the Calgary Real Estate Board did go up by more than $20,000 in May from April, but that’s because there were so many high-end properties changing hands.

Board figures show that during May, 52 homes priced at $1 million or more were sold compared with 29 the month before. Take those numbers out of the equation and average prices are going down.

Here are a couple of examples.

Two months ago, the average price of detached single-family homes in the southwest was $506,000. By the end of May, it had fallen to $472,500.

The southeast average slipped by less than $5,000 in two months and in the northeast, the decline was more than $10,000 — in one month.

Realtor Bryan Morrow of Re/ Max First is one who believes sales will continue to decline while listings increase. Good old supply and demand, again.

He agrees with the suggestion that upward average prices are being skewed by the number of upper-end deals — but there’s another calculation he rolls out.

He’s compiled a graph that tracks price reductions — and the fever line on that graph is pointing up.

For sellers, it’s not a good thing.

“Clearly with asking prices now being reduced en masse, it seems clear that the stats will begin to confirm the fact in a month or two at the most,” says Morrow.

This scenario is not one that realtors want to see.

“We, like lots of other hardworking realtors, have properties for sale and no one likes to suggest to their clients that perhaps they’ll need to reduce their price expectations. However, it is what we do when we see the wheels coming off and prices in decline — with no end in sight,” says Morrow.

Diane Scott, president of the Calgary Real Estate Board, says a market decline in sales was noted in May. The number of detached homes sold that month was down 20 per cent compared to a year ago, while condo deals fell by 21 per cent.

It marks an inauspicious start to the second quarter of the year.

“The first quarter of 2010 was exceptionally strong, with our spring sales coming early in the wake of anticipated mortgage hikes,” says Scott. But mortgage rates alone didn’t bring about the slowdown, she says, adding there was a reduced number of first-time buyers being active, a rise in monthly carrying costs brought on by higher mortgage rates, and international issues out of the control of almost everyone.

“Consumers are feeling a little nervous about the recent instability of the stock markets — and with the mortgage rate hikes behind us, it’s understandable that feelings of urgency among buyers have lessened,” says Scott.

While the number of first-timers has slowed, there has been an increase in the head count of move-up buyers, she says in the board’s monthly activity report.

“Our inventory is shifting to higher price points as move-up buyers enter the market,” says Scott. ” Nonetheless, our days on market year over year has decreased, suggesting that competitively-priced homes are selling.”

There is instability in the market, as there has been before. How long this will continue is anybody’s guess — but probably until such time as rates move again and people decide to jump into ownership before rates and prices get even higher — at least, that’s my guess.


// //

Buying a house is about life timing – not market timing

Forget market timing, buying a house is about life timing

Homes are a long-term investment

ups and downs of the housing market is near-impossible, so the best time to buy is when you can afford it.

‘You know, you’re making the biggest mistake of your life. The housing market is going to fall.”

I got this great piece of advice from another journalist at the Financial Post, who has since left the newspaper, after buying my first home. Not exactly the type of thing you want to hear after taking on huge debt and making the biggest financial decision of your life.

Lucky for me, I didn’t heed that advice about Toronto’s red-hot real estate market — in 1998. I’m not going to say I made a shrewd business decision 12 years ago, or even six years later when I bought a larger house.

For me, it wasn’t a case of not following what turned out to be bad advice from a fellow business journalist. Nor was it about trying to time the market.

I was simply following the same pattern as most Canadians: I got married and decided to stop renting and buy something. Later came the need for a bigger home when the second kid was on the way.

Which brings us to today. The supply of housing is rising fast as people try to list their homes for sale before the market “crashes.” This is happening at the same time that demand is starting to wane. Economists and even the real estate industry, are all predicting a correction — the only argument being how severe it will be.

So, the question for anyone buying is: should you wait?

Don Lawby, chief executive of Century 21 Canada, thinks the strategy of waiting for a crash is not going to work during this economic cycle. “For a market to crash, you have to have people who are desperate to sell,” says Mr. Lawby. “People will [only sell] if they can’t afford their mortgage or they don’t have a job.” He doesn’t see a decline in prices, “unless you are predicting that mortgages will renew at a hefty premium — which is not the case — or a whole bunch of people are going to lose their jobs.” Mr. Lawby believes neither will happen.

And, he adds, you are really into a risky game if you are timing the market. “A house is a home. If all you are doing is looking at it as an investment — that’s what happened the last 15 years — it’s not just that. It’s a place to live and a place to raise a family,” says Mr. Lawby. Even Benjamin Tal, a senior economist with CIBC World Markets, who, last month, said in a report that Canadian housing is 14% overvalued, has doubts about playing the market. But he suspects that’s exactly what some Canadians will do.

“Is there a sense that prices will go down and people will wait? I think it might be an issue,” says Mr. Tal. “It won’t be the main reason [people don’t buy], but it will happen at the margins. The fact that people sell at the peak and wait to buy is a normally functioning market.”

But even if you do make the right call on housing prices, it could end up backfiring on you in other ways. For example, if interest rates rise fast enough, any gains you make on price could be erased by interest charges, says Mr. Tal. Edmonton certified financial planner Al Nagy says you need to think of your house the way you think about any long-term investment. “Whether it’s an investment for use in your retirement or a house to live in, it’s a long-term thing. The timing becomes less critical than it would be if it is a speculative [investment].”

And he says making a call on the housing market is as tricky as any other investment call. “It’s very rare you catch the bottom. You can’t let the market dictate when it’s time to buy. The time to buy is when you can afford it,” says Mr. Nagy.

Complaints about Mortgage Prepayment Penalties

Everyone hates the payout penalties. We DO have a way to save you at least 15% on yours. Call for details!
Report Highlights Complaints about Mortgage Prepayment Penalties

TORONTO, June 9 /CNW/ – Complaints about the financial industry have reached record levels, according to new figures released today by the Ombudsman for Banking Services and Investments (OBSI).

OBSI looked into 990 banking and investment consumer complaints in 2009, representing a 48 % increase over 2008 and a more than tripling of the number of case files in just three years. OBSI also processed over 12,400 individual inquiries from consumers and small businesses in 2009.

As in recent years, OBSI saw more investment cases (599) than banking cases (391). Investment complaints continue to drive much of the overall increase in complaint volumes OBSI deals with. While banking sector complaints were up 21%, investment complaints were up a staggering 73%.

“The global economic crisis, coupled with sharp declines in financial markets, gave rise to much of the increase in complaints we saw,” said Douglas Melville, Ombudsman for Banking Services and Investments. “However, despite the improvement in the markets over the last year, complaint volumes remain high. We expect this to continue.”

OBSI looks into complaints about most banking and investment products and services including: debit and credit cards; mortgages; stocks, mutual funds, income trusts, bonds and GICs; loans and credit; fraud; investment advice; unauthorized trading; fees and rates; transaction errors; misrepresentation; and accounts sent to collections. Where a complaint has merit, OBSI may recommend compensation up to a maximum of $350,000.

“On the banking side, many of the complaints we saw dealt with mortgage prepayment penalties, rates on lines of credit, or fraud,” said Melville. “On the investment side, the vast majority of cases were related to the suitability of investment advice. Investment advisors need to fulfill their “know your client” obligations as well as explain the risks and characteristics of the products they are recommending.”

In 2009, consumers received compensation in 28% of cases reviewed by OBSI. The rate of compensation was 20% for banking complaints and 35% for investment complaints.

The Ombudsman for Banking Services and Investments (OBSI) is the national independent dispute resolution service for consumers and small businesses with a complaint they can’t resolve with their banking services or investment firm. As a free alternative to the legal system, we work informally and confidentially to find fair outcomes to disputes about banking and investment products and services.

Investment report ranks Calgary #1 in Canadian real estate markets

Investment report ranks Calgary #1 in Canadian real estate markets

CALGARY – Calgary is the best place in Canada to invest in the residential real estate market, according to a new report released today.

The Real Estate Investment Network’s report said that Calgary experienced one of its best economic and real estate periods in Canadian history a couple of years ago but then entered a strong, and needed correction.

“During the economic downturn, Calgary’s market is making a predictable correction resulting in slightly more affordable housing compared to recent years passed,” said the report. “It was economically impossible for the market to continue at the pace at which it was heading and now finds itself adjusting to market realities.

“This adjustment period, as the market searches for its new foundation from which to build, should continue in 2010 as the provincial economy is poised for another growth spurt.”

The REIN report said the in-migration pace in the city continuing to lead the country combined with the “renewed affordability” will help propel the local market over the coming years.

“We, fortunately, should not see the massive over-boom situation we previously witnessed as the market remains more in line with the fundamentals,” said the report.

Following Calgary as the top Canadian real estate investment cities are Kitchener-Waterloo-Cambridge, Edmonton, Surrey, Maple Ridge, Hamilton, St. Albert, Simcoe Shores (Barrie-Orillia), Red Deer, Winnipeg and Saskatoon.

“Successful real estate investing is all about identifying a town or neighbourhood that has a future, not a past,” said the report. “Sadly, many investors like to invest based on past performance; thus, they are constantly chasing the market. This is called speculating – not investing.”


Canada’s banking system healthiest in the world

Canada’s banking system healthiest in the world

| Tuesday, 1 June 2010

Canada’s banking system is a model for the United States and European countries struggling to cope with mountains of debt accumulated through a series of market crises, massive bailouts and recession according to a report in the Washington Post this morning.
The International Monetary Fund and World Economic Forum (IMF) is showcasing Canada for having the healthiest banking system in the world. . The IMF, in probing what made Canada’s mortgage lending system so resilient during the crisis, concluded that it was “boring” compared with the complicated, sophisticated and expensive financing system in the U.S., but nevertheless effective and safe.
Canada and its banks were barely touched by the 2008 financial crisis that nearly brought down the U.S. banking system and led to the biggest recession since the Great Depression.
Canadian bank losses were so low, and their cushion of reserves so high, that the banks managed to post profits for months in the aftermath of the 2008 crisis while major U.S. banks were teetering on the brink of insolvency and getting $250 billion in Treasury bailouts to cover burgeoning losses on bad mortgage loans.
“The Canadian experience showed that more prudent lending and borrowing played a big part in preventing the housing bubble that proved the near-undoing of the American banking sector,” said Robert Elliott, a Canadian banking lawyer at Fasken Martineau.
Though major U.S. banks have been recapitalized by the government and are posting profits again, “all the fresh capital in the world may not prevent another cycle of misery down the road” unless the U.S. also adopts more prudent lending practices, he said