Data on July 1, 2022 Prime Increase to 3.7%

Today, the Bank of Canada showed once again that it is seriously concerned about inflation by raising its overnight benchmark rate to 1.50% – making Consumer Prime 3.70%

This latest 50 basis point increase follows a similar-sized move in April and is considered the fastest rate hike cycle in over two decades.

Everyone STAY COOL!

Says Mortgage Mark Herman, top Calgary Alberta Mortgage Broker. Read More

Rates Increasing: How Much? & How Fast?

With interest rates now on the rise, 2 Questions: How much? & How fast?

Summary:

  • Rates are up by 1.45% on the Variable already (Prime was 1.75% and is now 3.2%)
    • There HAS BEEN a 1 x .25% increase and 1 x .5% increase so far = .75% so far
    Expected increases are 1 x .5% or .75%, and 1 x .25% still to come.
    • so expect Prime to get to 3.95% from 3.20% today, April 25th.
    • Insured variable rates are at Prime – 0.95% = 3.2 – .95% = 2.25% today
    • and they are expected to increase to 3.95% – .95% = 3.00% and then hold and decrease in the Fall of 2022.
    • these rates are lower than the current 5-year fixed rates of about 4% and are expected to come down in the Fall, 2022.

    DETAILS:

    Traditionally the Bank of Canada has used 0.25% as the standard increment for any interest rate move up, or down.  Occasionally the Bank will move its trendsetting Policy Rate by .50%, as it did at its last setting on April 13. Read More

Investment Mortgages WILL Be Harder to Get in 2023!

Its true! This thing called Basel 3 will make it harder to get an investment mortgage in 2023!

Lots of junk below, the short version is:

Canadian banks will need to apply more risk to investor mortgages and to lower that risk they may:

  • Increase the down payment needed from 20% to a higher amount … maybe 25% or 30%
  • Lend to fewer investors – which already make up 25% to 30% of the Canadian market.
  • New Zealand already started 40% down payment for investment properties!

“Avoid the new rules by buying your investment property in 2022!

Mortgage Mark Herman, top Calgary, Alberta mortgage broker.” Read More

List of Data Needed for Lo/No Condition Offers

Documents needed for Low/ No Condition Offers are below.

For Employees:

Employment Data

  • Employment letter ** – order from payroll or HR
  • 2 x recent pay slips

Tax Data

  • Last 2 years of your NOAs – Notice of Assessments – you get them back after you pay your federal income taxes
  • Last 2 years T4’s – to verify continued employment in your industry

Confirmation of down payment

90 days of detailed account history is needed – by way of:

  • 3 months of on-line bank statements (print-out to PDF and email is perfect) showing funds on deposit AND / OR
  • For RRSP/ TFSA funds: 3 x monthly account statements OR at least 2 statements, 3 months apart OR a year-end summary and recent statement.
  • If your name is not on the statements please print the “welcome page” that should show your name AND last few digits of the account numbers so they can be cross referenced.

** Employment letterA letter of employment is needed that includes the following: Read More

Bank of Canada holds benchmark interest rate steady & updates 2022 economic outlook

Summary:

  • Prime did not change today, Jan 26, and the Bank of Canada (BoC) clearly said they are planning on starting the needed rate increases at the next meeting in 6 weeks, on Wednesday March 2nd.
  • The Market has “priced in” between 4 and 6 increases in 2022, each by .25%, and between 2 and 4 increases in 2023, each by .25%
    • There may be fewer increases if inflation returns to the target of 2% from today’s 40 year high of about 5%.
    • The USA is seeing record 7% inflation and Canada usually gets dragged along with the US numbers so that balances the possibility of fewer increases.
    • Read More