Top Questions Answered on 20 Year Hike Today

General Angela Calla 13 Jul

The Bank of Canada increases the overnight lending rate by 1% today. The largest increase in over 20 years. It is expected that banks, credit unions and monolines will increase their prime rate over the following weeks. This will increase the cost of variable rate (VRM) and adjustable rate (VRM) mortgages as well as home equity line of credits HELOC).

What does this cost you?

Homeowners with adjustable rate mortgages will see their payments increase by roughly $56/m/100k.

With nearly 25% of home buyers borrowing over $600,000 to buy a home in the last quarter of 2021 these increases represent a significant increase in the monthly cost of the average mortgage in Canada.

Borrowers who have variable rate mortgages will not see their payments increase but will have the debt they pay down with each mortgage payment reduced. (Such as TD/CIBC)

Those who took variable rate mortgages when the prime was 2.7% need to be aware as trigger points in their mortgages loom closer.

How does this impact qualifying for a mortgage?

These changes do not have a direct impact on fixed rates but bond yields (the primary driver of fixed rates) have been falling since they spiked in mid-June.

Anyone seeking a five-year fixed rate mortgage with any federally regulated lender (monolines and banks) has lost nearly 20% of their borrowing power due to the stress test since February 2022.

Due to the Bank of Canada increase, today borrowers will lose nearly 10% of their borrowing power on floating rate mortgages (ARM and VRM) as well as HELOCs.

What should you do?

We suggest that borrowers take a few steps to assess their next move that we can help with.

1) Complete a personal budget to determine how to maximize/protect your options

2) Work out at what interest rate you reach the limit of your maximum housing budget

3) Use this maximize allowable rate to determine if a fixed or floating rate option is best for you

4) Take action on any renewal in the next 12 months instead of waiting, September is expected to bring more increases.

What today’s rate increase means for the market?

At this point, there is no questioning the fact that rising interest rates have begun to impact the borrowing power of home buyers. The “stress test” is starting to force borrowers to consider between qualifying for larger mortgages with the uncertainty of variable rates or qualifying for less with the predictability of fixed-rate mortgages.

BC and Ontario are likely to be hit the hardest by these changes with these changes costing the average borrower over $25,000 over the next five years.

Lower price point markets may see an increase in demand as buyers consider more cost-effective options. The average mortgage size in Alberta is over 30% smaller than BC/Ont making for significant savings in mortgage costs.

If rates continue to rise and mortgage applicants continually qualify for less it seems logical that the housing market could fall in sync. With immigration expected and a housing building shortage that is still to be determined.

It will be interesting to see if policymakers begin to consider increasing maximum amortizations beyond 25/30 years to alleviate the rising cost of mortgages and offset the decline in borrowing power as discussed in the last election, while federal policymakers may have this in sight, please remember there are banks that do have 40-year mortgages and no stress test to help borrowers who need it.


Angela Calla is an 18-year award-winning woman of influence which sets her apart from the rest. Alongside her team, Angela passionately assists mortgage holders in acquiring the best possible mortgage. Through her presence on “The Mortgage Show” and through her best-selling book “The Mortgage Code, Angela educates prospective home buyers by providing vital information on mortgages. 

In August of 2020, at the young age of 37, Angela surpassed $1 Billion dollars in funded personal mortgages. In light of this, her success awarded her with the 2020Business Leader of the Year Award.

Angela is a frequent go-to source for media and publishers across the country. For media interviews, speaking inquiries, or personal mortgage assistance, please contact Angela at hello@countoncalla.ca or at 604-802-3983.

Click here to view the latest news on our blog. 

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Throwing the Perfect Summer Social

General Angela Calla 11 Jul

There’s something magical about summer and no matter where you live in Canada, summer is the perfect opportunity to spend a little time with family and friends. Nothing says party vibes more than food on the grill and summer drinks flowing.

Whether you live in a country house, a suburban townhome or a city condo, gather your crew and remember these essentials:

  • Good Eats: To have the most success with your backyard party, you must pre-plan! This includes organizing an easy menu with bite size snacks, easy salads and flavour packed options to keep your guests satisfied. And don’t forget to make sure the barbecue has plenty of propane!
  • Cold Drinks: A cooler full of pop and water is a great start for a summer day! If you’re hosting adults, add a little alcohol to the mix! Boozy lemonades or spiked ice teas are easy to make and very fun to drink. Craft beer, ciders or chilled white wine are other fun options for a hot day!
  • Did Someone Say Dessert? If you’re planning an all-day affair, you might want to keep some quick and easy desserts or snacks on hand for the evening. Homemade ice cream bars, fruit kabobs or a veggie platter, or even chips can make great options for any peckish guests. And as the sun sets, you can break out the marshmallows and get your s’mores on in front of the fire!
  • Decor & Ambiance: For suburban hosts, your backyard party would include a sitting area, maybe umbrellas to offer some shady spots and some water fun! However, if you find yourself in smaller city digs, that doesn’t mean your party still can’t be one for the ages. Consider throw pillows, paper patio lanterns and plastic glassware which are all affordable and easy to find to help create that perfect party space!
  • Choosing Your Tunes: While music can set the ambiance, you need to know your guests. It’s not easy to pick a playlist that will appease all ears, but streaming services like Spotify and Apple iTunes have plenty of mixed playlists that should do the trick. Or search for Dominion Lending Centres on Spotify!
  • Entertainment: Backyard games such as a bocce ball set, Frisbee and even a football can keep the fun and competition going for hours! If you’re looking for a more chill hang, consider setting up a card table or some board games for those who want to partake.
  • For the Kids: If your party involves kids, you’ll want to keep the food simple and easy to eat with hands, so burgers, hot dogs, chips and watermelon are the way to go. You’ll also want to keep them occupied with simple games or more active options such as a soccer ball, mini trampoline or a sprinkler to run through and keep them cool. When daylight starts to fade, you can set up a backyard movie or camp-out with some tents to settle the night down.

Angela Calla is an 18-year award-winning woman of influence which sets her apart from the rest. Alongside her team, Angela passionately assists mortgage holders in acquiring the best possible mortgage. Through her presence on “The Mortgage Show” and through her best-selling book “The Mortgage Code, Angela educates prospective home buyers by providing vital information on mortgages. 

In August of 2020, at the young age of 37, Angela surpassed $1 Billion dollars in funded personal mortgages. In light of this, her success awarded her with the 2020Business Leader of the Year Award.

Angela is a frequent go-to source for media and publishers across the country. For media interviews, speaking inquiries, or personal mortgage assistance, please contact Angela at hello@countoncalla.ca or at 604-802-3983.

Click here to view the latest news on our blog. 

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5 Things to Consider When Building Your Own Home

General Angela Calla 8 Jul

Building a new home is an exciting adventure but requires very different considerations. To help you have the best experience, here are 5 of the most important things to consider:

  1.  It’s All In The Numbers: Whether you are shopping for a pre-built home, or are looking to create your own from the ground up, it is vital to know what you can afford and stay within it. This is the key to building a home that you will be able to enjoy for the next 20 or 30 years, while still maintaining your financial stability. Overall, the average cost to build a house can range $300,000 to $350,000 for 1,000 square feet to double or triple that amount. For example, an average 2,500 square foot home could cost between $500,000 and $875,000 to build depending on materials, design, etc. Keep in mind, these costs don’t include the land or taxes on the construction and material.
  2. Choose a Reputable Builder: This one seems pretty straight forward, but when you start looking it can quickly become overwhelming when you realize how many options there are. When it comes to determining the head contractor for your project, careful research is needed. Another option is to consult friends and family members who have gone through the process, or ask me, your mortgage expert and/or your realtor! They often have many qualified contacts in the industry or can help point you in the right direction.
  3. Build a Home For Tomorrow: As tempting as it can be to personalize your home to the nth degree and include every cool little feature you can think of, it is important to always keep resale value and practicality in the back of your mind. Life can often throw a few curve balls that, for one reason or another, may result in your having to sell your home in the future. If that time should ever come, you will want to be able to appeal to all buyers easily and not have to hold the house longer than necessary. Ask yourself if the features you are putting into your home will appeal to others, and also if the design suits the neighborhood you are building in as well.
  4. Go Green! Now more than ever before energy efficient upgrades are easy to add to your home. To make your home as efficient as possible, it is important to incorporate these options into your design BEFORE you start building. Options such as energy efficient appliances, windows, HVAC systems, and more can save you money in the long run and may also make you eligible for certain grants and discounts. For instance, the Canadian Mortgage and Housing Corporation (CMHC) green building program rewards those who select energy efficient and environment friendly options.
  5. Understand The Loan: Lastly, beyond the costs and design of building a new home, what does a mortgage look like for an unbuilt home? I suggest you provide me with a budget that includes both hard and soft costs, as well as the reserve of money you plan to have set aside in case you run into unexpected events.

Requirements for capital

A common mistake that many people don’t realize is you need capital upfront. The capital is needed for the initial down payment on the land/lot, as well as city red tape and permits to start the construction and throughout the build. It’s personal capital that is needed to finance the build to each stage of the construction. The draw mortgage will then advance money (the draw) to pay back the funds used to hit that stage of construction. For example, your capital finances the foundation of the home then the mortgage draw will advance funds to pay back that foundation capital. Then capital is used to get the house to the next draw stage which is generally framing, roofing, doors and windows (knows as “lock-up”) then the mortgage draw pays back the funds used to achieve the stage and so forth.

It is also important to note that the lender will consider the appraised value of the finished product. This value is determined before the project begins. In this example, the completed appraised value of the home would have to be at least $600,000 to qualify. In addition, the client will have to come up with the initial $150,000 to be able to finance the total cost of $600,000.

Additional Notes: When it comes to building your own home and construction loans, here are a few extra things to keep in mind:

  • Make your building plans in advance and stick with them to avoid costly changes during construction.
  • Depending on the lender, you may have a time frame within which you need to complete construction (typically between 6 and 12 months).
  • Construction loans are usually fully opened and can be repaid at any time.
  • Interest is charged only on amounts drawn; there are no “unused funds”
  • Once construction is complete and project completion has been verified by the lender, the construction mortgage is “moved over” to a normal mortgage

If you’re looking to build a home, don’t hesitate to reach out to me for friendly mortgage advice!


Angela Calla is an 18-year award-winning woman of influence which sets her apart from the rest. Alongside her team, Angela passionately assists mortgage holders in acquiring the best possible mortgage. Through her presence on “The Mortgage Show” and through her best-selling book “The Mortgage Code, Angela educates prospective home buyers by providing vital information on mortgages. 

In August of 2020, at the young age of 37, Angela surpassed $1 Billion dollars in funded personal mortgages. In light of this, her success awarded her with the 2020Business Leader of the Year Award.

Angela is a frequent go-to source for media and publishers across the country. For media interviews, speaking inquiries, or personal mortgage assistance, please contact Angela at hello@countoncalla.ca or at 604-802-3983.

Click here to view the latest news on our blog. 

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What to Know About the Latest Interest Rate Hikes

General Angela Calla 6 Jul

With recent Bank of Canada interest rate hikes, and more on the way, here is what you need to know about how these policy changes affect your mortgage.

First and foremost, the interest rate hikes directly affect individuals that currently have an adjustable-rate mortgage.

Depending on your mortgage amount, you’re looking at a potential mortgage payment increase of $40 per month for every $100,000 of balance owing. For example, if your mortgage balance is $400,000 then your monthly payment will increase approximately $160 per month.

As Canada’s lending prime has increased, variable rates increase as these rates are tied to prime. Payments need to increase to ensure the scheduled amortization remains the same. Hence you will still pay off your mortgage as the original amortization shows. For those individuals on a fixed-mortgage, you will not be affected by these interim changes outside of renewing your mortgage. If your mortgage is up for renewal, you will likely be renewing at a higher rate depending on your lender. If you’re still six months away from renewing, it may be a good idea to look into the options for early renewal to avoid getting caught up in another interest rate hike later this year.

All rates, fixed or variable are expected to rise more over the summer months. Please reach out to me today to discuss obtaining a rate hold. I can lock-in an interest rate for 90-120 days while you plan your next step whether it is renewing, purchasing or planning for changes.

If you’re not currently a homeowner, but were looking at getting into the marketplace, it is a good idea to revaluate your budget and potential calculations for homeownership to ensure that your estimates are in line with the new interest rates. Download my mobile app My Mortgage Toolbox to play around with calculators and review your budget.

While interest rate hikes affect everyone, understanding the dollar value change for your situation and adjusting your budget accordingly, can help ease the pressure from increased mortgage costs. If you have any questions or are not sure what your next move should be, don’t hesitate to reach out to me today! I’d be happy to help review your situation and walk you through your options.


Angela Calla is an 18-year award-winning woman of influence which sets her apart from the rest. Alongside her team, Angela passionately assists mortgage holders in acquiring the best possible mortgage. Through her presence on “The Mortgage Show” and through her best-selling book “The Mortgage Code, Angela educates prospective home buyers by providing vital information on mortgages. 

In August of 2020, at the young age of 37, Angela surpassed $1 Billion dollars in funded personal mortgages. In light of this, her success awarded her with the 2020Business Leader of the Year Award.

Angela is a frequent go-to source for media and publishers across the country. For media interviews, speaking inquiries, or personal mortgage assistance, please contact Angela at hello@countoncalla.ca or at 604-802-3983.

Click here to view the latest news on our blog. 

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Ontario Teachers’ announces completion of its acquisition of HomeEquity Bank

General Angela Calla 6 Jul

Ontario Teachers’ Pension Plan Board (“Ontario Teachers’”) announced today that it has completed the acquisition of HOMEQ Corporation (“HomeQ”), the parent company of HomeEquity Bank, from Birch Hill Equity Partners Management Inc. (“Birch Hill”) and the other minority shareholders of HomeQ, in a deal that was first announced in September 2021.

The acquisition by Ontario Teachers’ represents the organization’s continued vision for investing in successful Canadian financial services businesses like HomeEquity Bank, which is focused on serving retired Canadians through pioneering approaches to building wealth and financial security.

“We look forward to supporting HomeEquity Bank’s growth and believe in its incredible potential,” says Jeff Markusson, Senior Managing Director, Financial Services, Private Capital at Ontario Teachers’. “They have impressive growth prospects, a compelling value proposition, a high-quality management team and share our vision of enhancing the lives of retired Canadians.”

HomeEquity Bank is Canada’s leading bank offering reverse mortgage solutions including the flagship CHIP Reverse Mortgage. The value of HomeEquity Bank’s total reverse mortgage portfolio under management now stands at $5.7 billion.

With a 35-year track record of helping Canadians 55 and older stay in place by accessing the equity in their homes, HomeEquity Bank is well positioned for sustained growth as more Canadians near retirement age and seek solutions to create income and build wealth. HomeEquity Bank had more than $1 billion in reverse mortgage originations in 2021, a first for the bank and a 28 per cent increase over 2020.

“We’re incredibly proud of Ontario Teachers’ confidence and investment in our business and vision,” says Steven Ranson, President and Chief Executive Officer of HomeEquity Bank. “We will continue working hard to serve the needs of Canadian homeowners age 55+ with innovative financial planning solutions. I would also like to thank Birch Hill for fully supporting HomeEquity Bank’s goals and success for the past nine years.”

Ontario Teachers’ was advised by TD Securities Inc. as financial adviser, with Blake, Cassels & Graydon, LLP as legal adviser. Legal adviser to HomeQ was Torys LLP.

About HomeEquity Bank

HomeEquity Bank is a Schedule 1 Canadian Bank offering a range of reverse mortgage solutions including the flagship CHIP Reverse Mortgage™ product. The company was founded more than 35 years ago to address the financial needs of Canadians who wanted to access the equity of their top asset – their home. The Bank is committed to empowering Canadians aged 55 plus to live the retirement they deserve, in the home they love. HomeEquity Bank is a portfolio company of Ontario Teachers’ Pension Plan Board, a global investor that delivers retirement income for 333,000 current and retired teachers in Ontario. For more information, visit www.chip.ca

About Ontario Teachers’

Ontario Teachers’ Pension Plan Board (Ontario Teachers’) is a global investor with net assets of C$241.6 billion as at December 31, 2021. We invest in more than 50 countries in everything from equities to real estate to infrastructure and venture growth, to deliver retirement income for 333,000 current and retired teachers in Ontario.

With offices in Hong Kong, London, San Francisco, Singapore and Toronto, our more than 350 investment professionals bring deep expertise in industries ranging from agriculture to artificial intelligence. We are a fully funded defined benefit pension plan and have earned an annual total-fund net return of 9.7% since the plan’s founding in 1990. At Ontario Teachers’, we don’t just invest to make a return, we invest to shape a better future for the teachers we serve, the businesses we back, and the world we live in. For more information, visit otpp.com and follow us on Twitter @OtppInfo.

(This article is courtesy of HomeEquity Bank)


Angela Calla is an 18-year award-winning woman of influence which sets her apart from the rest. Alongside her team, Angela passionately assists mortgage holders in acquiring the best possible mortgage. Through her presence on “The Mortgage Show” and through her best-selling book “The Mortgage Code, Angela educates prospective home buyers by providing vital information on mortgages. 

In August of 2020, at the young age of 37, Angela surpassed $1 Billion dollars in funded personal mortgages. In light of this, her success awarded her with the 2020Business Leader of the Year Award.

Angela is a frequent go-to source for media and publishers across the country. For media interviews, speaking inquiries, or personal mortgage assistance, please contact Angela at hello@countoncalla.ca or at 604-802-3983.

Click here to view the latest news on our blog. 

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Marc & Mandy – Angela Calla 5 Tips On Mortgage Renewals

General Angela Calla 30 Jun

Recently, our segment on the Marc & Mandy show aired in which we discussed the top five tips for mortgage renewals.

To put it succinctly, the tips you should follow are as listed:

  1. Plan your mortgage renewal four months in advance
  2. Understand the difference between fixed and variable rate mortgages
  3. Consolidate your debt
  4. Assess and adjust your amortization period if viable
  5. Buy insurance to protect your assets

If you have the time, watch this 2.5-minute clip from our segment to understand more in-depth what each of these points means.

 


Angela Calla is an 18-year award-winning woman of influence which sets her apart from the rest. Alongside her team, Angela passionately assists mortgage holders in acquiring the best possible mortgage. Through her presence on “The Mortgage Show” and through her best-selling book “The Mortgage Code, Angela educates prospective home buyers by providing vital information on mortgages. 

In August of 2020, at the young age of 37, Angela surpassed $1 Billion dollars in funded personal mortgages. In light of this, her success awarded her with the 2020Business Leader of the Year Award.

Angela is a frequent go-to source for media and publishers across the country. For media interviews, speaking inquiries, or personal mortgage assistance, please contact Angela at hello@countoncalla.ca or at 604-802-3983.

Click here to view the latest news on our blog. 

mortgage

OSFI takes focused action to reduce systemic banking system risk

General Angela Calla 30 Jun

Today, the Office of the Superintendent of Financial Institutions (OSFI) released a new Advisory (Clarification on the Treatment of Innovative Real Estate Secured Lending Products under Guideline B-20). The Advisory complements existing expectations under Guideline B-20, which articulates OSFI’s expectations regarding underwriting practices and procedures for reverse residential mortgages, residential mortgages with shared equity features and combined loan plans.

As shared in its Annual Risk Outlook (2022-23), OSFI is taking action to ensure that federally regulated financial institutions are well prepared to address the risk of persistent, outstanding consumer debt that can make lenders more vulnerable to negative economic shocks. Accordingly, this Advisory outlines regulatory expectations with respect to Combined Loan Plans (CLPs), loans with shared equity features, and reverse mortgages.

CLPs are an innovative product that have become the predominant uninsured real estate secured lending (RESL) offering, and they can provide great value to Canadians. As their structures evolve, so too must our approach and treatment of such exposures. The most significant concern with these products is the re-advanceability of credit above the 65 percent Loan-to-Value (LTV) limit. Products structured in this way could lead to greater persistence of outstanding balances and increase risks to lenders and households.

For most borrowers using CLPs, these changes will have no effect on the way that they use their products. For those who owe more than 65 percent LTV, there will be a gradual period where a portion of their principal payments will go towards reducing their overall mortgage amount until it is below 65 percent of its original loan to value and not be re-advanceable. This will typically happen the next time borrowers renew their CLP after the end of October or December 2023 depending on the lender’s fiscal year. 

Sound mortgage underwriting remains the cornerstone of a healthy residential mortgage lending industry. We are confident that our actions today are responsible, fit for purpose and contribute to its continued resilience. By acting prudently, making evidence-based decisions, engaging with regulatory partners, and being clear about our expectations of lenders, OSFI is building a foundation of stability regardless of what lies ahead.

Quote

“OSFI is continuously monitoring the economic environment for a range of vulnerabilities that could pose a risk to the health of Canada’s financial system. Today, we have asked federally regulated financial institutions to make their innovative mortgage products safer and more sustainable over the long term. We are confident that our actions today will contribute to the continued resilience of Canada’s residential mortgage lending industry, and in turn of our financial system.”

– Peter Routledge, Superintendent

Quick Facts

  • Consumers will not see an increase to their monthly payment requirements as a result of this change.
  • This action will not impact new homebuyers.
  • Uninsured real estate secured lending (RESL) offering refers to residential mortgages with a 20 percent down payment or more.
  • Combined Loan Plans (CLP) are typically a traditional, amortizing mortgage loan blended with a revolving line of credit.
  • As of March 2022, CLPs that are above 65% LTV account for $204Bn of the $1.8Tn total outstanding residential mortgages as per Bank of Canada data.
  • In the case where a borrower has exceeded the 65 % LTV ratio, a portion of that principal payment will be required to go towards principal repayment, gradually reducing the overall CLP borrowing limit to the 65% LTV threshold.
  • The implementation date for federally-regulated lenders with October 31st Fiscal Year End will be October 31, 2023. For federally-regulated lenders with December 31st Fiscal Year End, the implementation date will be December 31, 2023. Consumers with CLPs will not see a change to their product structure until their next renewal after these dates.

(This article is courtesy of Cision)


Angela Calla is an 18-year award-winning woman of influence which sets her apart from the rest. Alongside her team, Angela passionately assists mortgage holders in acquiring the best possible mortgage. Through her presence on “The Mortgage Show” and through her best-selling book “The Mortgage Code, Angela educates prospective home buyers by providing vital information on mortgages. 

In August of 2020, at the young age of 37, Angela surpassed $1 Billion dollars in funded personal mortgages. In light of this, her success awarded her with the 2020Business Leader of the Year Award.

Angela is a frequent go-to source for media and publishers across the country. For media interviews, speaking inquiries, or personal mortgage assistance, please contact Angela at hello@countoncalla.ca or at 604-802-3983.

Click here to view the latest news on our blog. 

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Vancouver Consumer – The Angela Calla Mortgage Team

General Angela Calla 28 Jun

Recently, Angela was interviewed on the Vancouver Consumer, hosted on CKNW 980, to talk about the current real estate market.

In this 30-minute interview, Angela covers the recent rise in interest rates, why it is happening, what we can expect in the future, and what you can do to prepare yourselves to be in the best position to navigate the current market. Taking the proactive approach a reaching out to an independent mortgage professional, and not just banks, will better lay out the options before you and help realize if a change is in your best interest. Perhaps you’re even considering selling your property in light of the growing interest rates. To many, this is a big concern, but once more, it is not your only option. There is the possibility to refinance your mortgage, consolidate debts into one payment, or, if you are 55 or older, the consideration of a reverse mortgage is also possible.

This is only a brief summary of the few topics covered in this interview. If you have the time, do give the full interview a listen HERE.


Angela Calla is an 18-year award-winning woman of influence which sets her apart from the rest. Alongside her team, Angela passionately assists mortgage holders in acquiring the best possible mortgage. Through her presence on “The Mortgage Show” and through her best-selling book “The Mortgage Code, Angela educates prospective home buyers by providing vital information on mortgages. 

In August of 2020, at the young age of 37, Angela surpassed $1 Billion dollars in funded personal mortgages. In light of this, her success awarded her with the 2020Business Leader of the Year Award.

Angela is a frequent go-to source for media and publishers across the country. For media interviews, speaking inquiries, or personal mortgage assistance, please contact Angela at hello@countoncalla.ca or at 604-802-3983.

Click here to view the latest news on our blog. 

mortgage

How to deal with a real estate market in flux? Mortgage broker explains

General Angela Calla 27 Jun

After two years of ultra-low, pandemic-induced core lending rates, inflation in Canada is now the highest it has been in 30 years. To accommodate, the Bank of Canada is hiking those rates back up.

For mortgage seekers and current borrowers, payments could be on the rise. Add in record-high home prices and a constantly changing real estate market, and it can be a tough field to navigate.

There’s help for potential homeowners or those with existing mortgages coming up for renewal, though. According to Vancouver author, radio show host and mortgage broker Angela Calla, the current climate is all the more reason to schedule an appointment with an independent mortgage broker.

“A licensed mortgage professional’s interest is to help you navigate the market without bias,” she says. “That’s incredibly important when taking into consideration all the changes that are constantly happening and how you can navigate that with your changing lifestyle.”

In partnership with the Angela Calla Mortgage Team, we take a look at how current and prospective homeowners can navigate their finances during the current real estate market flux.

Getting a personalized option

When Nadine Furnell and her husband, Scott, needed to renew their mortgage, they wanted options beyond the bank. After three homes and several mortgages, they were ready for a more personalized approach that accommodated their lifestyle and needs. So they called broker Angela Calla and her team for help.

Furnell says not only did the team lock in a lower interest rate before the Bank of Canada’s most recent hike, but her family is now saving $1,500 a month.

“Over 20 years, we had not one phone call from the bank telling us our mortgage was renewing,” Furnell says. “The Calla team consolidated two vehicle loans into the mortgage with a lower interest rate. The mortgage itself didn’t even go up — it might have increased $100 or something like that.”

An independent mortgage broker usually accesses your credit score once and uses it to source several loan options, whereas borrowers shopping around with different lenders open themselves up to multiple checks. That can take points off their overall score, which then potentially impacts which products are available.

Calla points out banks can only sell their own products, whereas a mortgage broker examines options from a range of lenders. That allows them to source the best rate while also considering paydown and amortization options, potential insurance coverage and other products.

“If working with the lender you already do business with has the lowest cost of borrowing, then that’s what an independent broker will recommend,” Calla adds.

Climbing the property ladder

Even with rising interest rates, a mortgage still has a lower rate than most lines of credit, credit cards and other unsecured loans. Since lending institutions make the most amount of money on unsecured products, they typically focus only on the rate of the mortgage when bringing in new clients or renewing existing loans.

But according to Calla, that doesn’t always benefit borrowers. “Different lending products make different profit margins for institutions, and everybody within banks has different roles, depending on their sales goals and targets,” she says. “You can’t just assume that’s going to line up with what’s financially beneficial for you.”

By consolidating any pre-existing, high-interest debts into a mortgage, an independent mortgage broker can help clients achieve long-term financial goals sooner. If they’re saving hundreds — or sometimes thousands — of dollars a month on interest, a borrower can then reinvest that money into an RRSP, for example, and save even more at tax time.

“Effectively, focusing only on the mortgage keeps you in debt for a longer period of time, making it harder to move up the property ladder,” Calla adds. “When you have an independent mortgage broker, the goal is to reduce your overall cost of borrowing and improve your financial health.”

Angela Calla

In many cases, it’s also a much more personal relationship, where the dialogue is open for yearly financial check-ups to ensure a borrower is always in the best situation for their goals and needs.

“We got nothing but radio silence from the bank,” Furnell says. “They would rather just throw more money at me and get me more into debt. We’re quite happy with our decision to go through a mortgage broker service.”

Above all, Calla advises, don’t wait to take charge of your financial health. “Don’t expect real estate prices to go down and don’t try to time the market,” she says. “What’s important is finding a budget that works for you and aligning yourself with the right people to ensure you’re in the best position with the products that are available.”

(This article is courtesy of Global News)


Angela Calla is an 18-year award-winning woman of influence which sets her apart from the rest. Alongside her team, Angela passionately assists mortgage holders in acquiring the best possible mortgage. Through her presence on “The Mortgage Show” and through her best-selling book “The Mortgage Code, Angela educates prospective home buyers by providing vital information on mortgages. 

In August of 2020, at the young age of 37, Angela surpassed $1 Billion dollars in funded personal mortgages. In light of this, her success awarded her with the 2020Business Leader of the Year Award.

Angela is a frequent go-to source for media and publishers across the country. For media interviews, speaking inquiries, or personal mortgage assistance, please contact Angela at hello@countoncalla.ca or at 604-802-3983.

Click here to view the latest news on our blog. 

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Higher rates but less inflation panic: What CIBC’s Benjamin Tal is predicting for stocks, home prices and the economy

General Angela Calla 27 Jun

Mounting fears of a recession have gripped equity markets, with the S&P/TSX Composite Index now firmly in correction territory. The S&P/TSX is down 13 per cent from its record closing high of 22,087, reached on March 29.

The Globe and Mail recently spoke with Benjamin Tal, deputy chief economist at CIBC Capital Markets, who shared his perspectives on the risk of an economic contraction, monetary policy and implications for the housing market. Mr. Tal also provided some suggestions on which stocks may do well in this challenging environment.

Inflation is at a multidecade high, negatively affecting corporate probability and consumers. Yet, inflation is a lagging indicator so I wonder if there’s the risk that the Bank of Canada keeps raising rates while economic growth is contracting, putting the economy at risk of a recession. Has there ever been a time when the Bank of Canada combatted inflation that was more than 5 per cent and there hasn’t been a recession?

Nope, that’s the point.

I look at four sources of inflation, but before you start analyzing any of that, you have to have a working assumption about COVID: We are in the process of transitioning from a pandemic to an endemic.

Now we can analyze those four sources of inflation.

We’ll start with energy. If you look back in history, almost every time we had an oil shock, we had a recession immediately after. So the question is, to what extent is oil as inflationary as it used to be? So here we have three things. One, the shock that we are experiencing now is not as bad as in previous years in real terms. Second, the economy’s sensitivity to high energy prices has been reduced. If you look at the last 10, 15 years, energy consumption per unit of GDP is going down so we are more efficient. The other thing is the response from Alberta. In the past, the minute oil prices went up, oil executives in Alberta were very busy investing. That’s not the case now because everybody knows that green is replacing black.

Given that underinvestment are we now in an energy supercycle?

I am not sure about a supercycle but I think it’s fair to say that oil prices will remain elevated. But remember we’re talking about inflation. Inflation is the rate of change. It is reasonable that at this level energy is flat, or steady, which means that on a year-over-year basis, energy will not be a major inflationary force.

And the other sources of inflation?

The second source of inflation is the supply chain, and that’s a big one. If we are able to ease the restrictions on the economy vis-à-vis COVID then I think you remove a huge portion, maybe 60 per cent, of the inflation we’re seeing.

The third is rent inflation. If you look at the home price-to-rent ratio, it went to the sky. The combination of higher rents and lower home prices will help this ratio to go back to semi-normal. Higher interest rates will increase rental demand because people cannot afford to buy houses. We still have new immigrants coming. We have a lot of foreign students coming. We’re underestimating the number of people looking for units so the demand will be there. The supply is very limited, and more and more what we’re seeing is builders are not building because of the increase in construction costs. I had conversations with at least six big builders and I can tell you that big projects, especially rental projects, are being delayed or cancelled altogether because they simply cannot make money, the margins are squeezed.

The fourth source is the labour market – the wages. Wages are rising, especially among low wage individuals because that’s where the shortage is.

So you have the Bank of Canada able to control two things: one is wages, the other is rent, and the rest they cannot control, those being energy and the supply chain.

What you need to remember is the supply chain story. If the supply chain over the next six months starts easing then I think the Bank of Canada will be less concerned because they know that a significant portion of inflation is going to disappear. Therefore, I look at supply chain inflation, not now, not next month, but in September, October, November. I need to see some softening. The risk we are facing, and it’s a big risk, is that while the supply chain eventually will ease, it may not ease soon enough for the Bank of Canada to stop hiking.

At the end of the day, this is not about inflation. It’s about the cost of bringing inflation down to 2 per cent. The Bank of Canada and the Fed are telling you that they will do whatever it takes, even if it means taking an economy into recession, because they believe that’s the only way to keep the economy going, from a longer perspective.

So where do you see rates headed?

The market is forecasting an overnight rate of 3.5 per cent by the end of this year. Our official call is that they will stop at 2.75 to 3 per cent. Now, in my opinion, the difference between 2.75 to 3 per cent and 3.5 per cent might be the difference between no recession and a recession. The enemy of the economy is not only higher interest rates but also rapidly rising rates.

The effectiveness of monetary policy in Canada is actually stronger than in the U.S. Per capita, we have more debt, which means that we are more sensitive to higher interest rates. Second, their mortgage terms are for 30 years, our typical terms are for five years or less so we are more sensitive, which means that the tiny Bank of Canada is more powerful than the mighty Fed when it comes to impacting the consumer. In those terms, we estimate that a 1-per-cent increase by the Bank of Canada is equivalent to a 2-per-cent increase by the Fed, theoretically speaking. So the Bank of Canada is more effective in its ability to slow down the economy and this higher sensitivity to interest rates might slow down the economy enough for the bank to stop raising rates at 2.75 to 3 per cent, assuming that the supply chain is behaving. There is a probability of 30 per cent or so that that will not happen and we might overshoot.

So you believe there is just a 30-per-cent probability of a policy error that leads to a recession?

That’s fair. Usually you have a 10-per-cent probability of a recession at any point in time. The probability of recession is much higher now, three times higher than usual, so it’s not a rosy scenario.

With rapidly rising rates are you expecting to see a steep correction in home prices?

The housing market is very vulnerable to higher interest rates. If you look at some areas in the GTA and Vancouver, in the low-rise segment of the market, detached houses, prices are already down by 15 to 20 per cent. Prices will continue to go down, I believe. But remember, prices went up by 50 per cent in two years, so this is just an adjustment because we borrowed the activity from the future.

The lack of supply will work as a protection from a significant decline in prices.

My fear is that the economy will slow down. The housing market will slow down and over the next two years that will remove the sense of urgency about supply. But when we go back to semi-normal, the supply will not be there and there will be another wave of upward pressure on prices.

The S&P/TSX Composite Index recently dropped to its lowest level in the past year. Is the market sell-off a buying opportunity? Are we near a bottom?

I’m not sure where the bottom is. Timing the market is impossible. But if your time horizon is two or three years, I think that there are some good bargains at this point.

Our research suggests that dividend-paying stocks actually do okay during a period of higher interest rates. Telecommunications and utilities actually do okay, historically speaking.

Also, financials might be oversold at this point. The market is pricing in a lot of bad news. I think that from a long-term perspective, there are some opportunities there.

Are there country exposures that you favour?

I like Canada more than the U.S. in this environment for two reasons. If you look at the dividend yield in Canada, it’s double the dividend yield in the U.S. Also in Canada, we are benefiting from commodities.

When I interviewed you back in January, I asked you for your stock market prediction for 2022. You said you would assign the highest probability to a single-digit gain for the S&P/TSX Composite Index. Are you standing by this prediction?

Yes, I think it’s still reasonable to reach a flat to low-digit gain, at least we hope. With so much bad news already priced in, the market might have enough time to get there.

If you had to summarize your outlook for the second half of 2022 in one word or sentence, what would you say?

Higher rates, reduced inflation panic.

(This article is courtesy of The Globe Mail)


Angela Calla is an 18-year award-winning woman of influence which sets her apart from the rest. Alongside her team, Angela passionately assists mortgage holders in acquiring the best possible mortgage. Through her presence on “The Mortgage Show” and through her best-selling book “The Mortgage Code, Angela educates prospective home buyers by providing vital information on mortgages. 

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