The Bank of Canada made its eighth and final (scheduled) interest rate decision of the year and for the eighth time, left its overnight benchmark unchanged at 0.25%. As a result, the Bank Rate stays at 0.5%.

These low rates have been a feature of monetary policy since March 2020 with the initial pandemic lockdown of the economy. 

Going into today’s announcement, the question on the minds of economists and borrowers alike is when will the Bank change its policy?  We looked for clues in the Bank’s statement and summarize what was said below:

Inflation

• CPI inflation is elevated and the impact of global supply constraints is “feeding through” to prices on a broader range of goods
• The effects of these constraints will likely take some time to work their way through, given existing supply backlogs
• Gasoline prices, a major factor pushing up CPI inflation, have recently declined
• Core measures of inflation are little changed since September
• The Bank is closely watching inflation expectations and labour costs to “ensure that the forces pushing up prices” do not become embedded

Canadian housing & economic performance

• Housing activity had been moderating, but appears to be regaining strength, notably in resales
• Canada’s economy grew by about 5.5% in the third quarter, in line with expectations and bringing the level of GDP to about “1.5% below the last quarter of 2019, before the pandemic began”
• Third-quarter 2021 GDP growth was led by a rebound in consumption, particularly services, as restrictions were further eased and higher vaccination rates improved confidence
• Persistent supply bottlenecks continued to inhibit growth in other components of GDP, including non-commodity exports and business investment
• Recent indicators suggest the economy had considerable momentum heading into Q4
• Broad-based job gains in recent months have brought the employment rate “essentially back” to its pre-pandemic level
• Job vacancies remain elevated and wage growth has picked up
• Devastating floods in British Columbia and uncertainties arising from the Omicron (COVID-19) variant “could weigh on growth” by compounding supply chain disruptions and reducing demand for some services

Global economy

• The global economy continues to recover from the effects of COVID-19
• Economic growth in the United States has accelerated, led by consumption, while growth in some other regions is moderating after a strong third quarter
• Inflation has increased further in many countries, reflecting strong demand for goods amid ongoing supply disruptions
• Omicron has prompted a tightening of travel restrictions in many countries and a decline in oil prices, and “injected renewed uncertainty”
• Accommodative financial conditions are still supporting economic activity

Outlook: Stimulus continues

The Bank continues to expect CPI inflation to remain elevated in the first half of 2022 and ease back towards 2% in the second half of next year.

The Bank’s Governing Council noted that in view of ongoing excess capacity, the economy continues to require “considerable monetary policy support.” Accordingly, it remains committed to holding its policy interest rate at the effective lower bound until economic slack is absorbed so that the Bank’s 2% inflation target is sustainably achieved.

In the Bank’s October projection, the inflation target would be sustainably achieved “sometime” in the middle quarters of 2022. It did not provide further updates to this timing. Consequently, the market is left to speculate about when rates will rise.

The Bank did note, however, that it will continue to provide the “appropriate degree of monetary policy stimulus” to support the recovery and achieve its inflation target.

Time to borrow

With the benchmark rate unchanged – for now –  but signs of a coming shift in monetary policy, it pays to think proactively about your property financing plans for 2022. First National is ready to help with prompt service and always competitive rates.

January 26, 2022 is the Bank of Canada’s next scheduled touch point on monetary policy. Please watch for First National’s Executive Summary the same day for an assessment. 

You can read always read the article on: First National

Angela Calla is a 17-year award-winning woman of influence which sets her apart from the rest. She is without a doubt, a true expert in her field. 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. 

When it comes to the holidays, buying gifts can be overwhelming and expensive. Fortunately, it isn’t the only option! If you have some extra time and talent, do-it-yourself gifts are a wonderful way to make your friends and family feel cherished.

Thankfully, you don’t have to be a pro-level crafter to make someone a nice gift! Here are some great ideas for homemade gifts to help you get started: 

• Family Recipe Book – To share all of your favourite meals and homemade recipes. Try writing out a journal or simply gluing recipe cards down in a book! You could even put the cards in a photo album for an easy and clean flipbook
• Yummy Treats – Do you have a signature cookie recipe? Or maybe a special seasoning you create from scratch? Gifting homemade treats is a great way to celebrate the holidays! From filling a cute tin container with gingerbread to a mason jar brimming with your homemade mixture, your family and friends are sure to feel the love
• Say Cheese! – From getting personalized mouse pads to mugs to candles, highlighting a favourite photo(s) and memory from the year can be a great way to show your loved ones how much you cherish them
• Let Them be Pampered – Creating homemade bath bombs, soaps and/or scrubs is not as hard as you think! Creating a cute little pamper set with a couple different items can be the perfect pick-me-up for anyone on your gift list.
   

Fabrics from the Heart – Are you an excellent sewer? Cross-stitcher? Love to create with fabric and yarn? Gifting homemade washcloths, blankets, scarves or even clothing makes an exciting and unique gift that your family and friends are sure to love! 

Angela Calla is a 17-year award-winning woman of influence which sets her apart from the rest. She is without a doubt, a true expert in her field. 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. 

While you might think selling your home in winter is harder, with the right considerations it doesn’t have to be! When selling your home during warmer months, the focus is typically on curb appeal and gardening, as well as having bright colors and patterns to draw out different rooms. 

While curb appeal should not be forgotten in winter months, the focus should be centered on creating a warm, comfortable and welcoming space. You can do this through the following:

1. Curb Appeal – If you live in an area that receives high amounts of snow, be diligent about keeping your sidewalk and driveways clear for visitors, and to keep your home looking clean for viewing. Always make sure to sweep any fallen leaves or debris.
    
2. Keep it Cozy – Ensuring your home is sufficiently heated during showings will also go a long way to making it feel more comfortable; a steady 68 to 70 degrees Fahrenheit during showings is ideal.
    
3. Light and Inviting – With days being shorter and darker during winter, ensuring your home is light and inviting can make a big difference. In some cases, you may consider repainting the walls before listing your property.
    
4. Declutter – When selling, it is important to declutter your home so that it looks its best and gives room for people to imagine their own belongings in your space.
    
5. Define Property Boundaries – If you are showing your home in the middle of snow season, be sure to mark the four corners of your property so that potential buyers can see exactly what they are getting.

While there is some extra work with selling your home in the winter due to the weather conditions, it can pay off! Buyers tend to be highly motivated and often there is less competition for sales during this time giving more focus to your home.

Angela Calla is a 17-year award-winning woman of influence which sets her apart from the rest. She is without a doubt, a true expert in her field. 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. 

Did you know? Approximately 15%+ of Canadians are self-employed, making this an important segment in the mortgage and financing space. When it comes to self-employed individuals seeking a mortgage, there are some key things to note as this process can differ from the standard mortgage.

For self-employed individuals with an established business seeking best rate financing, the business must have a minimum of two years of history.  This includes self-employed applicants who own a full or part-time business and covers sole proprietorships, incorporations, and partnerships.

In order to obtain a mortgage when self-employed, most lenders require Revenue Canada personal tax Notices of Assessment and respective T1 Generals be included with the mortgage application for the previous two years. For individuals in Quebec, you will be required to provide NOAs (Notice of Assessments) from Revenue Canada, Relevé 1 from Revenue Quebec and T1 Generals. Typically, individuals who can provide these documents – with acceptable income levels – should have little issue obtaining a mortgage product and rates available to the traditional borrower.

One primary benefit of being self-employed is the privilege of writing your income down. You enjoy less tax because you get to write-off expenses, but you lose borrowing power. It is important to be aware of this because you can either pay less tax or have more borrowing power.

As a self-employed individual, you will fall into one of the following three categories:

1. You can provide the tax documents and you have a high enough income, so there aren’t any initial impediments to your application.
2. You can provide the Revenue Canada / Revenue Quebec documents, but don’t have enough stated income due to write-offs. In this case, you need a minimum of 10% down with standard interest rates.
   1. If you put down less than 20% down payment when relying on stated income, the default insurance premiums are higher.
3. You cannot provide the Revenue Canada / Revenue Quebec documents, which means you will be required to put down 20% and may have higher interest rates.

For a typical borrower, lenders often require a letter of employment and recent pay stubs to confirm and calculate income. When it comes to calculating income for a self-employed application, lenders will either take an average of two years’ income or your most recent annual income if it’s lower.

When it comes to submitting your mortgage application, you will need to provide the standard documentation in addition to the following:

• For incorporated businesses – two years of accountant prepared financial statements (Income Statement and Balance Sheet)
• Two most recent years of Personal NOAs (Notice of Assessments) and tax returns
• Potentially 6-12 months of business bank statements
• Confirmation that HST/Source Deductions are current

If you’re self-employed and looking to qualify for a mortgage, or simply have some questions for when you are ready in the future, please don’t hesitate to reach out today! I would be happy to work with you to ensure you have the necessary documentation, understand your options and can obtain a pre-approval to help you understand how much you qualify for!

Angela Calla is a 17-year award-winning woman of influence which sets her apart from the rest. She is without a doubt, a true expert in her field. 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. 

Canadian Economy Bounced Back Sharply In Q3

In line with the Bank of Canada’s forecast, the economy rebounded sharply in the third quarter following the weak performance in Q2. Stats Canada announced this morning that GDP grew by a whopping 5.4% in Q3 following the downwardly revised 3.2% earlier in Q2. As pandemic restrictions phased out and businesses resumed normal operations, consumer spending accelerated, growing at a 17.9% annual rate. Expenditures on clothing (+26.8%) and footwear (+30.3%) surpassed pre-pandemic spending. Expenditures on services rose 27.8%, led by a jump in accommodation and food services sales. Transport services (+40.3%), recreation and culture services (+26.1%), food, beverages and accommodation services (+29.0%), and personal grooming services (+35.8%) all showed significant increases.

Exports rebounded after a sharp decline in Q2. Business investment barely changed, hampered by supply chain disruptions.

Consumers remained flush with cash as incomes grew, boosted by wage gains and government transfer payments. The household saving rate fell from 14.0% in the second quarter to 11.0% in the third quarter, still strong from a historical perspective. Although spending surpassed income this quarter, this was the sixth consecutive quarter with a double-digit savings rate. The rate also remained higher than in the pre-pandemic period. The household savings rate is aggregated across all income brackets. In general, savings rates rise with income.

 

Housing Investment Declines

After four consecutive quarters of solid growth, new construction and renovations fell in the third quarter. The 5.2% (not annualized) drop in new construction was the most significant drop since the second quarter of 2009. The decrease in investments for the new construction of detached and multiple-unit dwellings was substantial, especially in Newfoundland and Labrador and Prince Edward Island. Nationally, there were $96.3 billion additions to the stock of homes in the third quarter.

HOUSING INVESTMENT IN NEW CONSTRUCTION AND RENOVATIONS

 

Ownership transfer costs (-10.0%) fell for the second consecutive quarter as activity in the resale market slowed. The decrease was widespread, and only Newfoundland and Labrador and Yukon posted increased ownership transfer costs.

The remarkable accumulation of residential mortgage liabilities in the previous quarter continued, with households adding $38 billion in the third quarter, more than double that two years earlier.

Bottom Line

Today’s release is, in some respects, ‘ancient history.’ Monthly GDP by industry data released this morning for September showed a modest uptick of 0.1%. And preliminary information indicates that real GDP rebounded in October, up 0.8% with increases in most sectors. Manufacturing led the growth after contracting in September due in part to the effects of the semiconductor shortage. Other notable increases were in the public sector, construction, finance and insurance, and transportation and warehousing.

All in, GDP in Canada is still below its pre-pandemic level. And uncertainty has increased with the announcement of the new Omicron variant. Traders are betting that the Bank of Canada will begin hiking the key overnight rate by April of next year and markets are currently pricing in five rate hikes in the next 12 months. Inflation remains a troubling concern, and Fed Chairman Jay Powell said today in testimony before Congress that he would accelerate his plan to taper all bond purchasing. In addition, according to Bloomberg News, “Powell also told a Senate banking committee that it’s time to stop using the word “transitory” to describe inflation”.

You can read this article at: Sherry Cooper Assoc.

Angela Calla is a 17-year award-winning woman of influence which sets her apart from the rest. She is without a doubt, a true expert in her field. 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. 

How much mortgage can I afford? That’s the question that kept me up at night before I bought my new home—the church conversion of my dreams. It’s a low-maintenance condo, which is just the way I like it. (I’m not a puttering-around-the-house kind of gal). While I mulled it over, I turned to countless online calculators that pumped out payment and mortgage amounts, which I gladly used as a guide.

But I couldn’t accept the idea of taking on a bigger mortgage than the one I already had. The deal is done, but looking back, I think the question that concerned me more was: Am I comfortable with the mortgage I need to buy my new digs?

Angela Calla is a mortgage broker based in Port Coquitlam, B.C., and the author of The Mortgage Code, which is a money-saving guide to moving up the property ladder (the stages of homeownership, from initially having a smaller, less expensive place to buying and selling your way into more expensive real estate).

Whether you’re buying your first home, upsizing or buying a second property, she says assessing your affordability is the first step towards homeownership, and it requires more homework than a quick Google search. It’s only once you have developed a clear picture of your personal finances—hopefully with the guidance of a financial planner—that you can make an informed decision about the mortgage you can afford.

“It should be normal practice for people to review their budget, their financial products, their bank statements and think about what their goals are,” she adds. “The difference in people who are more financially successful is not in their actual income. It’s the people who commit the time to review their finances regularly.”

How to calculate mortgage affordability

First, let’s define mortgage affordability. Though it’s sometimes used in reference to the cost of living in a particular city relative to the average income in that area, you should think about it as the amount a bank or financial institution will allow you to borrow based on your income, debt and living expenses.

Your mortgage affordability is based on:

• Your annual income before tax
• Your monthly debt payments, which includes credit cards, loans and car payments
• Housing costs such as property taxes, heat and half of your condo/HOA fees (if applicable). For the latter, only half the amount is used, because condo fees can cover things like property maintenance, insurance and some utilities, which are not used in debt-service calculations for other types of properties.

According to the Canadian Mortgage and Housing Corporation, a mortgage is affordable when your gross debt service (GDS) ratio—which accounts for your housing costs—doesn’t exceed 39%. To be considered affordable, your total debt service (TDS) ratio—which accounts for housing costs as well as other debt obligations—must not surpass 44%.

To calculate your gross debt service ratio:

Add up your housing costs (i.e. your mortgage payments, property taxes, heating and, if applicable, half of your condo fees.
Divide them by your gross income, which is your total earnings before taxes and deductions.
To obtain your GDS in the form of a percentage, multiply the result by 100.
Let’s say your household brings in a combined $130,000 per year, and you expect to pay $3,000 per month on the mortgage for your new single-family home, plus another $500 on property taxes and $150 on heating. In the eyes of lenders, you would have a GDS of 38%.

To calculate your total debt service ratio:

1. Add up your housing costs (mortgage payments, property taxes, heating and, if applicable, half of your condo fees). Also include any other debt obligations, such credit card and line of credit payments (based on monthly payment amounts of no less than 3% of the outstanding balance), car payments, student loans and child or spousal support.
2. Divide the total by your gross income, which is your total earnings before taxes and deductions.
3. To obtain your TDS in the form of a percentage, multiply the result by 100.

Now, on top of your housing costs listed above, let’s assume your non-housing related debts come in at $800 per month (for example, $600 on credit card and line of credit payments and $200 on your car loan). Your TDS ratio would fall within the limit, at 41%.

When it came to buying my own place, I was well within these numbers, but how much I could end up spending on a new mortgage still made me squeamish. Already in my 40s, shouldn’t I be paying off my mortgage instead of adding to it?

“That’s not reality,” says Calla. As difficult as it might be, she says it’s important to not compare yourself to others. Make the decisions that best suit your lifestyle and goals.

The math behind your down payment

In my case, I was selling my condo to finance the purchase of my new home, so I calculated how much I would have for a down payment based on an estimate of my current home’s value.

First, I tallied the costs associated with moving, including real estate agent commissions, legal fees, moving-day expenses, a home inspection and land transfer taxes (living in Toronto comes with paying double the land transfer tax you pay in other parts of Ontario). To calculate closing costs, the rule of thumb is to budget for 4% of your home’s purchase price. A $500,000 home, for instance, would require $20,000.

I decided not to touch my investments or savings to cover these costs, so I subtracted them from the potential profit of the sale. That left me with a down payment of over 20%, which means I didn’t have to pay mortgage default insurance.

Let’s bring the math to life using the example of a 25-year mortgage for a $500,000 home, assuming a 5-year term and 3% fixed interest rate.

Because I was able to make a larger down payment, I knew that would lower my monthly mortgage payments (assuming the same 25-year amortization) as well as the amount of interest I would pay over time. My own calculations suggested I would save at least $50,000 in interest.

The math behind your monthly mortgage payments

Now that I knew how much I could afford, it was time to estimate my monthly mortgage payments. With that amount handy, I would have an informed picture of my cash flow and financial well-being while living in my new home.

Let’s keep with our previous example of a 25-year mortgage for a $500,000 home, offered on a 5-year term and 3% fixed interest rate, to illustrate how a larger down payment can save you money in the long run. You can also use a mortgage payment calculator to help you get started.

While making a larger down payment is a better financial move, Calla believes that securing any mortgage is a smart decision, even when you can only afford to put 5% down.

“With homeownership, over 50% of the payment goes directly into your equity, while with renting, 100% goes to someone else,” she says. “And the gift of today’s low-interest rates gives you the ability to invest in yourself at an unprecedented rate.”

Still, following years of soaring real estate prices, saving for that 5% down payment remains a major hurdle for most people. In some cases, it may make more financial sense to continue renting and not stretch yourself too far. And if buying isn’t immediately in the cards for you, there are other strategies you can use to ensure you stay on track with your financial goals.

The next step: Getting a mortgage pre-approval

Calla strongly recommends getting a mortgage pre-approval before officially putting in an offer. “It’s the only way to gain an understanding of the real risk you’re going to be absorbing and how it’s going to impact your financial future,” she says.

This part of the process finally made me comfortable with the idea of upsizing to a new mortgage. I was able to confirm my financial health with a tally of my assets, a value assigned to my current home, and an informed look at my debts versus my income, which was all necessary info requested by the lender.

The good news is I was approved for a larger mortgage than I needed. And with that pre-approval handy, I was able to make a confident offer.

You can read this article on: MoneySense

Angela Calla is a 17-year award-winning woman of influence which sets her apart from the rest. She is without a doubt, a true expert in her field. 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. 

What Is a Sliding Scale and How It Affects Your Approval

You’re likely aware that the minimum down payment to avoid mortgage default insurance is 20%. What many may not be aware of is that a down payment of greater than 20% down payment will sometimes be required. As house prices rise substantially and people are looking at moving to different areas in the country, it’s an important highlight to consider and plan for during your pre-approval process.

For the most part, 20% will be sufficient. However, there are times where you may encounter a sliding scale, which can increase the minimum down payment requirement substantially. This can catch some people off guard. In the 2021 election has suggested they will make changes to the sliding scale and  earlier in the year many lenders have been making changes to there sliding scale, however it does impact those purchasing or moving up to the over 1 million dollar range, at this moment in time.

What Is A Mortgage Sliding Scale?

A sliding scale is where the minimum down payment changes once the purchase price hits a predetermined threshold. A lender will accept the standard 20% down payment, but only up to a certain value. Once the purchase price exceeds this value, a higher down payment is required on the excess amount. For example, a lender may accept a 20% down payment up to the first $1 million, but may require a 50% down payment for any amount above $1 million. This is what is known as a mortgage sliding scale.

What Is The Purpose Of A Sliding Scale?

It’s directly related to the lender’s risk. The higher the purchase price, the more the value can fall if the housing market were to correct. A sliding scale gives the lender added protection, and therefore reduces their risk. When a market correction occurs, it does not correct evenly. Some areas will see a much larger drop than others. Higher valued properties may also see a larger correction. A $5 million home for example has much more room to fall than an $800,000 home. A $5 million home also appeals to a smaller demographic, and can take longer to sell even in the hottest housing markets.

There are two major factors that can trigger the use of a sliding scale:

1. High purchase price
2. Property location

High Purchase Price

Sliding scale policies will vary from lender to lender, with the more stringent adhering to the example used above. They will allow a 20% down payment only up to the first $1 million of the purchase price, but will require a 50% down payment on the amount above $1 million.

1. This means the minimum down payment to purchase a $1.5 million property would be $450,000.
2. $200,000 for the first $1 million, and then another $250,000 for the additional $500,000.
3. While some mortgage lenders are this strict with their sliding scale policy, most lenders are more flexible.
4. What is the maximum purchase price you can hit without requiring a down payment over 20%?

The higher you go above $1 million, the fewer lending options become available. If you’re purchasing in a major metropolitan area such as the  GVA, GTA you can generally go up to a purchase price of around $2 million without triggering a sliding scale. In some cases even higher. The higher you go, the fewer lending options become available. This doesn’t mean you’ll be paying a higher rate, and excellent mortgage rates may still be available to you. Exceptions can sometimes be made to exceed a lender’s sliding scale limit, however these are granted on a case by case basis. The more demand for the area and the stronger the borrower, the easier it becomes for us to press it higher.

Note that the sliding scale limits may be reduced for condos, and policies will vary from lender to lender. If you are purchasing a condo for more than $1 million, it’s best to check with us first before putting in an offer to purchase.

Property Location

Another major consideration is the location of the property. The further you purchase outside of a major centre, the more stringent the sliding scale may become. In some cases, the sliding scale may start as low as $500,000, which is not uncommon. If you were looking at purchasing a $750,000 cottage for example, the lender may only accept a 20% down payment up to $500,000, with a 50% down payment required for the additional $250,000. This would result in a minimum down payment of $225,000, or 30%. The sliding scale requirements can vary substantially depending on the location.

This is where it gets interesting.

If you are purchasing with LESS than 20% down payment in a rural area, you can go up to $999,999 without running into sliding scale issues. I know this sounds counter intuitive, and flat out defies logic. This is because a down payment of less than 20% requires mortgage default insurance such as CMHC. This gives the lender the additional protection they need and reduces their risk, therefore it eliminates the need for a sliding scale.

Conclusion

It’s not just ‘some’ lenders who have a sliding scale policy. They all do. It doesn’t matter if you’re applying to a major bank, credit union, or monoline lender. They all use sliding scales.

Anytime you are planning on purchasing a property, never assume you’ll be okay because you have a 20% down payment. Part of getting pre approved is providing all the credit, income and down payment verification however every property is unique and subject to approval based on several unique merits  If your budget is over $1 million, you’ll definitely want to check with us first to include the area and types of properties you are planning on making an offer on. By doing so, you ensure we won’t run into any sliding scale complications and at least you will be prepared to adapt the strategy accordingly.

Angela Calla is a 17-year award-winning woman of influence which sets her apart from the rest. She is without a doubt, a true expert in her field. 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. 

Statistics Canada released the October Labour Force Survey this morning, reporting a slowdown in employment growth from the blockbuster pace of recent months. While some commentators were disappointed in the results, I have a more positive take. Canada returned its pre-pandemic level of employment in September ahead of the US and other G-7 countries. The resumption of a more normal pace of job gains was inevitable as we get closer to full employment.

Employment rose by 31,200 (+0.2%) in October, following a jump of 157,000 the month before. Indeed, job growth surged at an average monthly rate of 143,000 from June through September. That is not a sustainable pace of job gains but rather a reflection of the spike in hiring in the immediate aftermath of the lockdown. For example, hiring averaged 23,000 per month in the two years before the outbreak of COVID.

Employment increases in several industries, including retail trade, were offset by declines elsewhere, including accommodation and food services. Employment rose in Ontario and New Brunswick, while it fell in Manitoba and Saskatchewan. Declines in self-employment offset Gains among paid employees.The number of employed people working less than half their usual hours fell 9.7% (-100,000) in October and remained 117,000 higher (+14.5%) than in February 2020. Total hours worked were up 1.0% in October and were 0.6% below their pre-pandemic level.

Among people of core working age (25 to 54 years), employment rose by 53,000 (+0.4%) in October, with all the gains in full-time work. 

Angela Calla is a 17-year award-winning woman of influence which sets her apart from the rest. She is without a doubt, a true expert in her field. 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. 

Can I afford my payments comfortably today?

Taking a look at where we are today will help us prepare for inflation and protect you from being vulnerable. You may be able to modify your payment or find savings within a budget review.

Can I afford to increase my payments now even if rates do not go up?

We always recommend tacking on inflation by making small periodic increases to avoid future payment shock and protect your equity to empower you.

Am I living pay check to pay check?

If you are, maybe this is because of debt outside of your mortgage, breaking your mortgage early to pay out that debt can save you hundred or thousands of dollars per month and turn the tables for you to invest more into your own retirement instead of debt effectively.

Is there a remote possibility I need to break my mortgage term in the next 1-5 years?

The truth is, 4/10 people break their mortgages early, which is why the VRM is SO attractive since you will only pay 3 months interest. People say life is variable so your mortgage should be too.

Does my mortgage keep me up at night?

We all have an emotional connection to the decisions we make financially. Having the best mortgage means you feel confident in your decision as you were educated about the options available, had the power of choice by an unbiased party, and you’ll know you made the best decision for your family. Sometimes, the lender you have your mortgage with will vary greatly in penalties. With a variable rate, you can always lock in, however, there is a cost of security and it’s usually a higher penalty in most cases – if you need to break early.

We are here to help you determine what makes most sense for you. Contact us at 604-802-3983 or Email us and we will help you navigate the current rate market.

Angela Calla is a 17-year award-winning woman of influence which sets her apart from the rest. She is without a doubt, a true expert in her field. 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. 

The Province of BC is in the process on introducing new legislation that requires “cooling off” periods for resale properties and newly built homes.

The introduction of a “cooling off” period for all purchase transactions would mean the end of non-subject offers. Non-subject offers have been extremely common in this insanely competitive real estate market and ultimately puts buyers at great risk. This could be a good sign if we see legislation passed in 2022.

What you need to know about this

• I do not suspect this will result in a reduction of house prices. I do however, believe this will give buyers with less than a 20 percent down payment, the ability to do their due diligence with an appraisal and inspection
• Already in force for pre-sale units
• Other provinces in the the country (Quebec) have similar legislation
• A rescission period for other large purchases like cars, insurance, and other financial sectors are in place to allow consumers to have a due diligence period.

Official Press Release

Global News Link

While this addresses people in the market to purchase – fixed rates are on the rise. If you are looking for a Pre approval or have a renewal in 2022, the time to secure your rate with us is now.

Angela Calla is a 17-year award-winning woman of influence which sets her apart from the rest. She is without a doubt, a true expert in her field. 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.