Three in fiveCanadians say they do“a lot” of research before choosing their mortgage, according to a recentIpsos poll. But when it comes to mortgage renewals, too manyput in too little effort. Only 42% of renewal customers claim to do a lot of mortgage research. A disappointing1 in 5 (22%) admit to doing no research at all. That’s a real problem...
Private (non-prime) lenders are gettingtapped out across the country. Fisgard Asset Management Corporation, one of Canada’s largest mortgage investment corporations (MICs), is no exception. “It’s a dynamic time right now,” says Hali Noble, SVP atFisgard. She explains thatHome Capitals’ near-failure, Equitable Bank’s funding problemsand government rule tighteninghave spikeddemand for private mortgages.The company, whichmanages $240 million in loans,has almost fully utilized...
Mortgage Finance Companies (MFCs) pitch themselves as a better alternative to the banks. But that’s definitely not true in all cases. Here’s one example. At the moment, certain MFCs are refusing to offer blends and increases and/or refinances to existing customers. They’re doing this despite marketing those very same “features” to the brokers who sell their mortgages, who in turn...
Lenders wantto make sureyou can afford higher mortgage payments if interest rates soar. So does the government. That’s why regulators created the mortgage qualifying rate (MQR) — a.k.a., “benchmark qualifying rate,” “benchmark interest rate” or “Bank of Canada qualifying rate.” The MQR is the interest rate most commonlyused to “stress test” mortgage borrowers. Stress testing is the process of calculating...
When it comes to rate predictions, the bond market outwits us all. It incorporates every known economic variable to arrive at today’s level of interest rates and estimate future rates. Right now, the bond market is flashingtwo vividsignals: Rates are on the upswing Bond yields, which guide fixed mortgage rates, are nearing a 3-year high and they seem poised to...
In just the latest reminderthat banks valueprofitabovePR, each ofthe Big 5 havehiked prime rate by a full 1/4 point. That means the rate variable mortgages are based on risesto2.95% on Thursday, at most big lenders. Some had speculated (hoped) that banks would liftprime just15 bps to match their last stingy cut in 2015. But this was a “prime” opportunity for...
The kingpin of Canadian interest rates has officially made it more expensive to borrow — for the first time since 2010. By boosting its overnight rate target 1/4%-point this morning, the Bank of Canada is jacking up interest costs roughly $245 a year for every $100,000 of variable-rate mortgage. And rest assured (or unassured), that rate hikes are like roaches....
Canada’sbanking overlord, OSFI, is proposing a new 2-percentage-point (200-bps) “stress test” for people getting uninsured mortgages. Unlike the current stress test, which is based on onerate (the Bank of Canada posted 5-year, currently 4.64%), this new one is a frequently moving target. At200 bps above the borrower’s contract rate, it would fluctuate significantly based on the lender and term selected....
OK, how do I put this in a way that doesn’t sound over the top or like fear mongering? There was this mortgage rule proposal today, and it was a Whopper. No. Actually, it was largerthan that. More likea BK Quad Stacker with extra bacon, cheese and Stacker sauce. It was big. The potential rulesannounced this morning were put out...
“It does look as though [rate]cuts have done their job.” That was Bank of Canada chief Stephen Poloz in a CNBC interview today. It was the second time he’s provided this “forward guidance,”and it’s about the closest thing you’ll hear to him saying “rates are headedup — soon.” Poloz’s statement was “the final straw” forBMO. It triggered a change in...
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