Son Of A Broker » Toronto Mortgages

Mortgage Interest Rates For July 12th

chris — Thu, 15 Jul 2010 16:25:35 +0000

I was out of the city this past Monday camping in Killbear Park far from any internet connection making it impossible to get my Monday Mortgage Minute up. I’ll just briefly post the current rates for anyone who is looking to see how rates have changed since last week.

Chris Molder – Son Of A Broker

2.70% – 1 Year Fixed

3.49% – 3 Year Fixed

4.09% – 5 Year Fixed

3.09% – Merix 50/50 Mortgage (Fixed/Variable hybrid)

P-.70 3 Year Variable

P-.60 5 Year Variable

Prime Rate is currently 2.50%.

Bench Mark Qualifying rate is 5.79% (Used to qualify high ratio mortgages)

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

Gifted Down Payment

chris — Mon, 28 Jun 2010 21:45:51 +0000

Mortgages are very dynamic transactions. There are areas of the mortgage approval that don’t warrant any kind of special consideration but if for whatever reason the lender’s guidelines cannot be satisfied one can compromise the successful funding of a mortgage. Proof of down payment is one of those areas.

Generally speaking proof of down payment is an afterthought for most borrowers as most of the attention is given to proof of income and other conditions. From a borrower’s point of view the down payment money is available and they don’t give it a second thought. However there are some very specific rules that the lender is required to adhere to in conjunction with the Anti Money Laundering & Terrorism Act regarding proof of down payment.

Since using laundered cash for a large down payment is probably the easiest way to launder money the Government relies on the lender as a gate keeper of sorts. For down payment money coming from your own sources you are required to show 3 months bank or investment statements showing that the money has always been there or the gradual accumulation of funds. Any large deposits must be documented. If you keep the money in a shoebox under your bed it is not going to meet the lender’s criteria and will not be accepted.

Gifted down payment is acceptable to the lender however a gift can only be made by a directly related family member including, mother, father, brother, sister or grandparents. The lender will not accept gifted down payment from spouses, friends, aunts, uncles, cousins etc…

Seems straight forward but if you aren’t aware of these rules before making an offer to buy and you commit yourself to buying and run into a problem with proof of down payment it can be very stressful and compromise your mortgage.

Chris Molder – Son of A Broker… dedicated to your financial sufficiency and prosperity 416.461.0204

Monday Mortgage Minute- Toronto June 21st

chris — Tue, 22 Jun 2010 01:41:04 +0000

It looks like the fixed mortgage rate market has stabilized after the bank of Canada’s decision to increase the prime rate earlier this month. While rates aren’t as low as earlier this year, mortgage interest rates still remain low historically speaking.

With signs that the housing market is cooling and interest rates are staying low you have decided that now is the time to buy your first home. But what is the first step? Unless you are lucky enough to have the cash available to purchase without financing you should talk to a mortgage broker before you even talk to a real estate agent or search on MLS. By sitting down with a mortgage professional you can eliminate uncertainty and save yourself a lot of time when searching for a home. In many cases it takes only a 10 minute conversation to get assessed. You’ll be able to set a realistic price range and become aware of any potential pitfalls that could arise when satisfying conditions for the lender. Visit my website www.TridacMortgages.com to submit a quick & secure online application or send me an e-mail if you have any questions?

Chris Molder – Son Of A Broker

2.80% – 1 Year Fixed

3.75% – 3 Year Fixed

4.25% – 5 Year Fixed

3.13% – Merix 50/50 Mortgage (Fixed/Variable hybrid)

P-.65 3 Year Variable

P-.60 5 Year Variable

Prime Rate is currently 2.50%.

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

Click here to view the embedded video.

Monday Mortgage Minute June 7th 2010

chris — Mon, 07 Jun 2010 20:02:36 +0000

Following the Bank of Canada’s interest rate announcement last Tuesday we weren’t too sure in which direction the fixed rate market would move. Mortgage lenders responded by lowering their fixed rate mortgage rates. They also increased the spread on the 5 year variable rate mortgage from P-0.50 to P-.60 giving an effective rate of 1.90% based on the new prime rate of 2.50%. If you are just entering the interest rate market because you are considering buying or your mortgage is coming up for renewal it may not be obvious whether to go fixed or variable in this market. The circumstances are individuals are unique and there is a mortgage solution to suit your circumstances give me a call to discuss. 416.461.0204ext2

Chris Molder – Son Of A Broker

2.80% – 1 Year Fixed

3.75% – 3 Year Fixed

4.25% – 5 Year Fixed

3.10% – Merix 50/50 Mortgage (Fixed/Variable hybrid)

P-.50 3 Year Variable

P-.60 5 Year Variable

Prime Rate is currently 2.50%.

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

Click here to view the embedded video.

Monday Mortgage Minute – May 31st

chris — Tue, 01 Jun 2010 00:56:57 +0000

Toronto mortgage interest rates haven’t changed over the past 7 days. However tomorrow morning after the Bank of Canada makes their decision regarding the prime rate we could see some interesting movement in the fixed rate mortgage market. Stay tuned for more.

Chris Molder – Son Of A Broker

2.85% – 1 Year Fixed

3.85% – 3 Year Fixed

4.35% – 5 Year Fixed

3.10% – Merix 50/50 Mortgage (Fixed/Variable hybrid)

P-.50 3 Year Variable

P-.50 5 Year Variable

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

Click here to view the embedded video.

Monday Mortgage Minute – Toronto Interest Rates May 24th

chris — Wed, 26 May 2010 01:25:31 +0000

I didn’t manage to get this post up yesterday it was way too nice of a day! As explained in past videos, fixed rate mortgages are dependent on bond yields. Over the past 2 weeks the yields have suffered as a result of the economic turmoil in Europe caused by the Greek crisis. Even positive economic data like increased inflation and record breaking retail sales in Canada weren’t enough to bolster interest rates. This of course is good news if you are buying or remortgaging. A recent article in the Toronto Star “Rate Hike Not Guaranteed“ by Emily Mathieu argues that the Bank of Canada may not have the ability to increase the prime rate on June 1st. If you are stumped on how to position your mortgage in these unique times get in touch with me.

Chris Molder – Son Of A Broker

2.85% – 1 Year Fixed

3.85% – 3 Year Fixed

4.35% – 5 Year Fixed

3.10% – Merix 50/50 Mortgage (Fixed/Variable hybrid)

P-.50 3 Year Variable

P-.50 5 Year Variable

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

Click here to view the embedded video.

Monday Mortgage Interest Rate Minute May 10th

chris — Tue, 11 May 2010 00:14:48 +0000

2.65% – 1 Year Fixed

3.85% – 3 Year Fixed

4.35% – 5 Year Fixed

3.25% – Merix 50/50 Mortgage (Fixed/Variable hybrid)

P-.40 3 Year Variable

P-.50 5 Year Variable

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

Click here to view the embedded video.

New Merix Fixed 5 year with 90 Day Ratehold

chris — Tue, 04 May 2010 16:42:24 +0000

The problems over seas in Europe are already hitting close to home as bond yields have dipped for the last couple of days indicating that investor confidence is shaken. This bodes well for borrowers looking to get into fixed rate mortgages as there may be a reversal to the sharp steady increases to fixed rate mortgages over the past couple of weeks. Today, Merix Financial announced that they are lowering their fixed 5 year to 4.35%.

Click here to complete an application for a Merix Financial Mortgage today.

Monday Mortgage Minute May 3rd 2010

chris — Mon, 03 May 2010 16:28:42 +0000

Mortgage interest rates continue to climb for the 4th week in a row. There is a lot of discussion between observers and economists who think that the banks are prematurely driving rates up as highlighted in Rob Carrick’s Globe & Mail article, “Are Big Banks Jumping the Gun?”. With each passing week the variable option looks better and better, the only draw back is if you require a high ratio mortgage you will need to qualify based on the Bank of Canada’s Qualifying Rate which is an astronomical 6.25%. Not only is the spread between fixed and variable almost 3% there are a lot of forces at play which may prevent the prime rate from increasing significantly over the coming months, inflation is down in Canada and the Greek crisis will have far reaching global effects.

Chris Molder -Son Of A Broker

2.65% – 1 Year Fixed

3.85% – 3 Year Fixed

4.64% – 5 Year Fixed

4.39% – 5 Year Fixed Quickclose (Must close before June 15th)

3.25% – Merix 50/50 Mortgage (Fixed/Variable hybrid)

P-.40 3 Year Variable

P-.50 5 Year Variable

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

Click here to view the embedded video.

What is CMHC Mortgage Insurance Good For?

chris — Thu, 29 Apr 2010 20:22:54 +0000

I have observed recently that both first time home buyers and seasoned owners alike struggle to understand CMHC insurance. From a borrower’s perspective the insurance premium paid up front for the benefit of a mortgage lender seems heavy handed and unfair. However, without CMHC you wouldn’t be able to buy or refinance your homes unless you had 20%, or more for the down payment. Even if a lender would entertain financing, without insurance, a mortgage lender would make you pay for their exposed risk through much higher interest rates.

Let’s just review why and what mortgage insurance is?

In Canada, it’s because of CMHC that lenders are willing to lend to borrowers who buy without large down payments. In the not to distant past (CMHC history), Canadian homebuyers had to purchase with much larger down payments. This is still the reality in many other countries today where there is no insurance available. Home buyers need to purchase with a 25% to sometimes 50% down payment making home ownership difficult.

CMHC insurance is a one time premium that is added up front to your required mortgage amount (you do not have to pay for it out of pocket) and insures the lender if default occurs. Although it seems like real estate is a forever increasing asset this is not always true. Markets can turn very quickly, as we recently saw in the U.S.. After legal fees, real estate fees and market corrections a lender can easily lose money if there is not enough equity or down payment.

The insurance premium is determined by a table depending on how much downpayment you bring to the purchase. You can find the rates here.

5% down- 2.75% premium

10% down – 2.00% premium

15% down -1.75% premium

In addition, there’s a 0.2% premium that is added for each additional 5 years of amortization above the traditional 25 year amortization. You should also be aware that included in your closing costs there is PST at 8% on the insurance premium.

It does seem a little discouraging and frustrating to have to pay this premium on top of all the other fees that you incur as a homebuyer. However, it serves a very important purpose to keep the mortgage interest rate low and give you the opportunity to own a home with less than 20% down. The couple thousand dollars that gets added on top of the mortgage makes a difference of about $20 each monthly payment. In retrospect it is a small price to pay for the satisfaction and pride of owning your own home.

So, there’s a snapshot on the CMHC insurance. Of course, every situation is different and requires a full analysis. If you have any questions, please feel free to contact me. I’d be happy to hear from you.

Chris Molder – Toronto mortgage broker
416.461.0204
chris@tridacmortgages.com