Son Of A Broker » I hate paying mortgage interest

Monday Mortgage Minute & Interest Rates For April 19th

chris — Sun, 18 Apr 2010 16:07:14 +0000

A combination of positive economic data, the high Canadian dollar and probably the most important factor, the end of RRSP season in mid March when lenders artificially kept rates low to attract business, has caused two increases to fixed rate mortgages over the past 10 days. The difference between current fixed rates (4.59%) and current variable rate mortgages (1.75%) is 2.84% making variable a very attractive option today. Mortgages aren’t a one size fits all product, please call or write me if you would like to see what option suits you best.

Christopher Molder – Son Of A Broker

Fixed 1 year – 2.95%

Fixed 3 year – 3.95%

Fixed 5 year – 4.59%

SPECIAL Fixed 5 year – 4.44% (must close before May 31st)

3 or 5 year Variable P-.50 (1.75%).

NOTE: Rates are subject to change without warning at the lender’s discretion.

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Monday Mortgage Interest Rate Minute – March 22nd

chris — Tue, 23 Mar 2010 00:36:51 +0000

Fixed mortgage rates are married to bond yields. As a mortgage broker I constantly look towards the 5 year Government of Canada bond yield to forecast where rates are heading to advise clients. Bond yields and fixed rate mortgages have a positive relationship. Put another way, when the yield on 5 year Canadian Bonds increases, the mortgage interest rate for a fixed 5 year mortgage also increases. Over the past 3 weeks we have observed an interesting trend. The bond yield has increased from 2.52% to 2.82%, an increase of +0.30% and yet lenders are not budging on their historically low interest rate offerings. If past trends are anything to go by a rate increase is just around the corner. In the mean time the following rates are still being offered.

Christopher Molder – Son Of A Broker

1 year fixed – 2.55%

3 year fixed – 3.35%

5 year fixed – 3.79%

SPECIAL * 5 year fixed – 3.69% (must close by April 26th 2010, purchase & refinance only)

3 year variable – Prime-.50% (1.75% effective rate)

5 year variable – Prime-.40% (1.85% effective rate)

What Does Term Refer To In My Mortgage Contract?

chris — Fri, 15 Jan 2010 03:26:55 +0000

There is no such thing as a silly question. Especially when it comes to your mortgage and money! As a mortgage broker I sit down and work with a lot of borrowers, some have a very high level of financial literacy and others never had the opportunity or need to learn. Arranging a mortgage on your home along with being a necessity should also be an educational experience.

When you arrange a mortgage on your home with a lender you are entering into a contract with the lender. Term refers to the length of time that the mortgage contract is effective for. For the term of the mortgage both you and the mortgage lender are obligated to honor the conditions and terms as set out by the mortgage contract. Most mortgages in Canada are arranged for 5 years at a time, however there are mortgages with terms from 6 months all the way up to 10 or 15 years and beyond.

During the term you are making 4 promises to the lender, otherwise known as covenants:

1- You promise to keep up with the mortgage payments

2- You promise to keep the property taxes up to date

3- You promise to keep the property in good repair

4-You promise to keep sufficient insurance coverage on your home

This is not a one way street though, during the mortgage term the lender is also making promises to you:

1- They give you ‘quiet and uninterrupted possession’ of your home

2- They cannot change the agreed upon interest rate during the term

3- They cannot demand that you repay your mortgage before the term expires (unless you break one of your promises)

Most mortgage lenders will allow you to break the mortgage contract before the term is up. This is where the penalty comes in. The majority of mortgage contracts are written so that the penalty is the greater of 3 months interest or the Interest Rate Differential (IRD). I could write a whole post on what to look out for when it comes to IRD. NOTE: Be wary if you are offered a low interest rate that is too good to be true because that is a sign that your mortgage may not be ‘breakable’ and you will be handcuffed to the lender until the term expires or you will have to pay them all the interest that you would have paid them over the term of the mortgage.

What happens at the end of your term you may ask? If you are a good client to the mortgage lender and pay them consistently over the life of the mortgage they will be happy to extend a mortgage renewal to you to enter into another term with them. This is an important juncture in the life of your mortgage because it represents an opportunity for you to refinance, move or paydown or off your mortgage with no interest penalty. It also represents a good opportunity for you to negotiate a lower rate or switch lender. Amazingly 90% of Canadian homeowners take the posted rate renewal offers their banks send them and pay more then necessary in interest.

If you are frustrated or confused about mortgage financing and looking for a guide with patience and who really understands the ins and outs of the business contact…

Chris Molder – Son Of A Broker

Licensed by the Financial Services Commission of Ontario under Lic#M08010066

Son Of A Broker

chris — Thu, 12 Nov 2009 19:55:24 +0000

The broker with his son. (Arnold & Christopher Molder)

My name is Christopher Molder. I’m the son of a Toronto mortgage broker. Since 1975 my father has been sharing his wisdom and insights about mortgages with his clients and myself. The purpose of this blog is to share the knowledge and experience of over 30 years in the mortgage business with you!

5 Things You Should Know About Your Mortgage – Episode #11

chris — Tue, 10 Nov 2009 19:08:40 +0000

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Line of Credit vs. Mortgage – Episode #10

chris — Tue, 10 Nov 2009 19:06:22 +0000

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Fixed vs. Variable Rate Mortgages – Episode #9

chris — Tue, 10 Nov 2009 19:02:54 +0000

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Character – The 5 Cs of Credit- Episode #7

chris — Tue, 10 Nov 2009 18:59:19 +0000

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Your Property And Your Mortgage – Episode #6

chris — Tue, 27 Oct 2009 18:41:37 +0000

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Income & Your Mortgage – Episode #5

chris — Tue, 27 Oct 2009 18:38:05 +0000

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