So, today is the official first day of Spring!!!! The real estate market is very brisk these days and prices are on the rise.
There is a great mortgage rates out there right now. 3 year and 4 year fixed promotion: 2.79% (3y) and 2.99% (4y) It’s an amazing rate, no restriction on amortization or prepayment privileges. It is a PROMOTION so will disappear at anytime.
For more information visit www.edmontonmortgagesource.com
After selling 2 homes in the last 7 days I am really starting to feel that the Edmonton Real Estate market is starting to pick up.
This could be do to the fact that many people are trying to buy before the March 18th deadline for the change in mortgage rules. But I also have to attribute it to a all the economic developement that is starting to happen in Edmonton now and scheduled for the year 2012.
The Edmonton rea estate market should be booming again and I see prices increasing again in the incoming 18 months as well as I expect interest rates to increase and we see economic recovery happening and we see the Bank of Canada trying to curb any inflationary pressures by raising interest rates.
This make now the best time to buy for the next 2 years before prices in Emdonton go up and before interest rates also go up.
I mentioned in an earlier post that the mortgage rule changes were coming into effect in April. Some of the changes do come into effect in April but there are also some changes that are coming into effect as early as mid-March. I strongly recommend if you are thinking of buying that you get pre-approved and lock the interest rate in.
You can contact Souchita at Dominion Lending Centres and she can do that for you. Her contact number is 780-932-2225 or visit her at www.edmontonbestmortgagerates.com
As I have been warning some of you for the past few weeks intrest rates were going to Rise. Well we have just seen our first increase of 0.60% across the board. Keep in mind that I don’t beleive that we are done with rate hikes, and don’t be surprised if we see another one by this summer.
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| Prime Rate is 2.25 %.
Variable rate mortgages from as low as Prime – .50%
Rates are subject to change without notice. Fixed mortgage rates shown in table above and quoted variable mortgage rates are available nationally to qualified individuals. Some conditions may apply. Lower rates may be available in certain regions, or to those with higher credit scores or higher net worth – check with your Dominion Lending Centres Mortgage Expert for full details. *O.A.C., E.& O.E. |
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Weekly rate minder provided by: Souchita Rattanarasy Dominion Lending Centres Optimum 780-932-2225. Explore Mortgage Scenarios with Helpful Calculators on http://www.souchita.com/
We have received an update from Canada Mortgage and Housing Corporation (CMHC) regarding the upcoming changes that we informed you about in mid-February. To briefly recap, fixed rate mortgages with terms of less than 5 years, as well as variable rate mortgages, will be reviewed for approval (qualified) based on 5 year rates, beginning April 19, 2010. It was not clear at the time of the announcement if the 5 year rates used for qualification would be discounted rates (currently 3.89%) or posted rates (currently 5.39%).
CMHC has now clarified that the qualifying rate for the affected terms will be the greater of the “benchmark rate” and the contract interest rate. CMHC defines the benchmark rate as the Conventional Mortgage – 5 Year rate published by the Bank of Canada (series 121764), which is currently 5.39%. The following are updated examples that illustrate the upcoming changes:
Fixed rate mortgages with terms of less than 5 years will be qualified based on the greater of the benchmark rate and the contract interest rate, rather than the current method of qualifying clients based on their contracted interest rate. For example, a client selecting a 3 year fixed term today would qualify based on 3.40% (some lenders offer lower “sale” rates), the new criteria will instead require the client to qualify based on the 5 year benchmark rate (currently 5.39%). If however the client selected a 5 year fixed term (or longer), the client would qualify at the contract rate (currently 3.89% for a 5 year term).
Variable rate mortgages will also be qualified based on the greater of the benchmark rate and the contract interest rate. By comparison, variable rate mortgages are currently reviewed based on 3 year rates. Assuming that posted rates are used in both cases, a client will need to qualify based on the 5 year posted rate (currently 5.39%), rather than the 3 year posted rate (currently 4.30%), which reduces the maximum amount that a client can borrow.
Changes to CMHC policies re: Self-Employed borrowers
Effective April 9, 2010, self-employed borrowers with more than 3 years in the same business will be required to provide third-party validation of income (e.g. financial statements, contracts, T4s, Notice of Assessments, etc.). This means that the above category of self-employed borrowers will need to fully support their personal income with adequate documentation when obtaining a mortgage.
Shirley Froese
Mortgage Agent
CENTUM Elite Mortgage Corp.
Ph: 780-940-4813
This won’t hurt a bit, homebuyers.
The mortgage rule changes announced Tuesday by Financial Minister Jim Flaherty will weigh a bit on real estate speculators and heavily indebted people who want to fold their high-rate credit card debt into a lower-rate mortgage. But for rank and file homebuyers, the changes will barely be perceptible when they take effect on April 19.
“This should have a limited impact on what I see daily,” mortgage broker Peter Majthenyi said in an e-mail he fired off after Mr. Flaherty’s announcement. “I believe it’s more a message that ‘Big Brother’ is watching and cares.”
Olympics aside, the favourite Canadian diversion of the moment is to debate whether there is a bubble in the housing market. Those most worried about the housing market plunging have urged Mr. Flaherty to raise the minimum down payment for a home and reduce the maximum payback period.
But the 35-year amortization, favourite of first-time buyers across this land, remains. So does the 5-per-cent down payment, which is heavily relied upon in high-cost cities like Vancouver, Calgary and Toronto.
All the measures announced by Mr. Flaherty affect mortgages covered by government-backed mortgage insurance, where the buyer puts less than 20 per cent down. The key change for typical home buyers is that, regardless of what term or type of mortgage they choose, they’ll have to be able to afford the five-year rate.
This is a sensible way of building some slack into the system as we look ahead to a cycle of rising interest rates. If someone chooses a variable-rate mortgage, where the interest rate can be as low as 2 to 2.25 per cent today, they’ll have to be able to handle the payment at the current five-year rate. Right now, the posted rate at the big banks is 5.39 per cent.
You won’t have to actually make the higher payments required by the five-year mortgage. You’ll just have to theoretically be able to carry them and still remain within the limitations lenders set out on how much of your gross income can be consumed by debt (it’s 42 to 44 per cent, just so you know).
Mortgage brokers report that a lot of lenders were already ensuring clients could afford the payments on a three-year mortgage. So bumping up that up to a five-year term will only have a marginal effect.
“Are we going to see the odd borrower have to come up with more money or not buy they house they want? Absolutely,” Mr. Majthenyi said. “But will it have a dramatic effect? No.”
Another reason why the changes won’t be jarring is that a huge number of homebuyers are actually choosing five-year mortgages these days. A study issued by the Canadian Association of Accredited Mortgage Professionals last month showed that fixed-rate mortgages accounted for 86 per cent of mortgages in set up in 2009 and, of those, 70 per cent were for a five-year term.
People who borrow to buy investment properties to either flip for a quick profit or to generate income are also affected by Tuesday’s announcement. If you buy a property you’re not going to live in, then you’ll have to put down a minimum 20 per cent to qualify for mortgage insurance. That’s up from 5 per cent.
But Mr. Majthenyi said not all lenders even require clients to have mortgage insurance if they put 20 per cent down. He also said that stiff mortgage insurance premiums already discouraged people from putting 5 per cent down on an investment property.
“In my office of 10 brokers, I don’t think I know of one client we’ve processed on a high-ratio rental property,” he said.
The final mortgage change restricts the ability of existing homeowners to refinance their mortgages to take on more debt. The new ceiling is 90 per cent of the value of your home, compared to the current 95 per cent.
Mortgage broker Jas Grewal said one group that will be affected by this is recent buyers who made a small down payment and are struggling with high credit card balances and other debts. By folding these debts into their mortgage, they can reduce their interest rate from as high as 19 per cent down to something closer to 3 or 4 per cent.
“Let’s say you put 10 per cent down – if we go from 95 to 90 per cent, you’re not going to be able refinance,” Mr. Grewal said. “You’re going to have to wait until your house value goes up and gives you some equity.”
Source: Rob Carrick of the Globe and Mail (www.TheGlobeandMail.com)
The Honourable Jim Flaherty, Minister of Finance, today announced a number of measured steps to support the long-term stability of Canada’s housing market and continue to encourage home ownership for Canadians.
“Canada’s housing market is healthy, stable and supported by our country’s solid economic fundamentals,” said Minister Flaherty. “However, a key lesson of the global financial crisis is that early policy action can help prevent negative trends from developing.”
The Government will therefore adjust the rules for government-backed insured mortgages as follows:
“There’s no clear evidence of a housing bubble, but we’re taking proactive, prudent and cautious steps today to help prevent one. Our Government is acting to help prevent Canadian households from getting overextended, and acting to help prevent some lenders from facilitating it,” said Minister Flaherty. “If some lenders aren’t willing to act themselves, we will act. These measures demonstrate the Government is committed to taking action when necessary to support the long-term stability of a sector that is so vital to our economy and the financial well-being of Canadian families.”
These adjustments to the mortgage insurance guarantee framework are intended to come into force on April 19, 2010.
Source: Department of Finance Canada
If you are thinking of buying you need to buy now. Call us today to get pre-approved for a mortgage and help you find that perfect home for you today. 780-634-8151
On April 19 our government will lay down three major rule changes to “prevent” a housing-price bubble and keep homeowners from getting “overextended.”
Here is the official announcement from today: Finance Department release
These new rules apply to government-backed insured mortgages only.
The Good: 5-Year Fixed Qualification Rates
The Bad: 90% Maximum Refinancing
The Ugly: 80% Maximum Insured Financing On Rentals
What to Expect:
Interestingly, Minister Flaherty took a small jab at lenders in his release today, saying these rule changes are designed to “help prevent some lenders” from “facilitating” irresponsible lending.
“If some lenders aren’t willing to act themselves, we will act,” said Flaherty. That’s bold talk given that Canadian lenders have exceptionally low default rates, and already conform their mortgages to all existing government guidelines. Source: http://www.canadianmortgagetrends.com/
Call me today to get yourself pre-approved for a mortgage to help you buy a home before these changes come into effect. Our number is 780-634-8151
It can difficult to determine or predict when interest will go up. But a survey done by MSN money came up with these results. These are of course the opinion of people responding to a questionnaire on a website, and has no real scientific proof of when interest rates will go up.
5284 responses, not scientifically valid, results updated every minute.
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| Prime Rate is 2.25 %.
Variable rate mortgages from as low as Prime – .30%
Rates are subject to change without notice. Fixed mortgage rates shown in table above and quoted variable mortgage rates are available nationally to qualified individuals. Some conditions may apply. Lower rates may be available in certain regions, or to those with higher credit scores or higher net worth – check with your Dominion Lending Centres Mortgage Expert for full details. *O.A.C., E.& O.E. |
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Weekly rate minder provided by: Souchita Rattanarasy Dominion Lending Centres Optimum 780-932-2225. Explore Mortgage Scenarios with Helpful Calculators on http://www.souchita.com/
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