Starting in 2010, lenders had to ensure that borrowers getting variable or 1- to 4-year fixed mortgages could afford payments at the 5-year posted rate. That rule applied to mortgages with less than 20% equity.

In 2012, OSFI asked federally regulated lenders to apply the same rule to all variable and 1- to 4-year fixed mortgages, regardless of equity. But some lenders, which are provincially regulated, were not bound by this guideline.

As a result, some lenders today let conventional borrowers (20 % down payment or higher) qualify for variable-rate mortgages using significantly lower rates. That makes it easier to get approved when your debt ratio is above average.

How much easier?

Consider a qualified borrower making $70,000 a year. As of today, that person can get a variable-rate mortgage as high as $483,000 at some lenders. With an insured mortgage, he or she would be capped out at roughly $413,000.

Questions on the best mortgage? Contact the Angela Calla Mortgage Team 604-802-3983 or callateam@dominionlending.ca

The Bank of Canada should keep its key interest rate on hold until economic data persuades it otherwise, Central Bank Chief Stephen Poloz said on Tuesday, adding that he was not worried about calls from some international players to tighten policy.

 His comments follow controversial remarks by Canada’s finance minister on Sunday suggesting there would be pressure to raise interest rates in 2014.

“For us, minimizing the risks of making a big mistake here is what we’re trying to do, and that tells us that we should be holding rates where they are until the data flow changes our mind,” Poloz said in an interview with CBC television.

Asked about the potential for higher rates in 2014, Finance Minister Jim Flaherty told CTV television on Sunday there would be some pressure to tighten because of the US Federal Reserve scaling back its bond-purchasing program.

Click here to read more from the Financial Post.

Questions on your Mortgage? Contact the Angela Calla Mortgage Team 604-802-3983 callateam@dominionlending.ca

A lawyer and respected real estate veteran is offering a fresh warning for those enlisting the help of family members for a down payment – a word of caution brokers should share with all first-time buyers and, indeed, their parents.

“If the parents try to transfer the 1 per cent back to the kids without telling the lender, this will actually cause the mortgage to go into default,” Mark Weisleder wrote in a column for the Toronto Star. “That’s because the standard terms of a mortgage typically state that the mortgage comes due at the option of the lender, if someone sells their interest.”

It is worth noting that even if the parents transfer their 1 per cent share, he said, they are still responsible if the kids don’t make the mortgage payments, since they signed the mortgage originally.

“It’s always great to help your kids if you can, but you have to think carefully about what you’re doing,” Weisleder writes. “This will ensure everyone knows whether it’s a loan or a gift and their obligations going forward.”

Essentially, if it’s a gift, there are no strings attached, he said, but if it’s a loan, there will likely be a second mortgage registered on title to protect the parents

“The bank will have to know about it and approve,” Weisleder said.

Parents can offer to be a guarantor if their child buyer’s income doesn’t meet the necessary thresholds. However, lenders will often require the parent’s name to appear on the deed as well. And an important consideration – and one that may often be overlooked – is to figure out how to transfer the percentage owned by a parent back to the child.

One workaround, Weisleder notes, is to have the parent leave the rest of the property to their child in their will.

“It was suggested that the parents leave their 1 per cent share to the kids by just doing an amendment to their will, so the kids would end up with it later,” Weisleder writes. “Without a will, problems could arise later if other beneficiaries do not wish to co-operate and want to sell the home to get their share of the estate.”

At the Angela Calla Mortgage Team we look at all aspects of helping you with the best mortgage. As some lenders do not allow non residing applicants on a mortgage, or even to structure mortgages between spouses for certain tax benifits this is one of the many considerations we advise you on to ensure the lowest cost of homeownership. Cotact us today at 604-802-3983 or callateam@dominionlending.ca

The Angela Calla Mortgage Team reported on this back in April and here it is again in The Globe & Mail.

The story in the link provided below contains great details and a side by side comparison where there is over a $3,000.00 difference in savings. This goes to show you there is more behind choosing a lender then the rate. Even when comparing the same rate side by side, this term & lender policy would cost you thousands if you didn’t know better. Every borroers circumstances are different and if you can be approved by a lender that can save you money, that’s the first option provided to you from our team so you understand your options.

http://www.theglobeandmail.com/globe-investor/personal-finance/mortgages/the-hidden-trap-of-mortgage-penalties/article15774375/

The Angela Calla Mortgage Team looks at the lowest overall cost in homeownership when considering your options for a mortgage. Contact us directly at 604-802-3983 or callateam@dominionlending.ca to get us to help you.

As heard on this weeks Mortgage Show on CKNW with Angela Calla. To get pre approved for this property or any other purchase email us at callateam@dominionlending.ca or call 604-802-3983

This weeks deal of the week has been brought to you by:

http://rboies.mlslink.mlxchange.com/?r=83500299&id=32313935343534.366

Robert Boies Royal LePage Coronation West cell: 604 341 3009 t: willingtwo E-mail: robboies@royallepage.ca www.willingsellerwillingbuyer.com

Please note that properties like this move quickly and getting set up with Rob Boies directly robboies@royallepage.ca will keep you abreast of all of these types of oppertunities meeting your speciafications

Thanks for visiting

Angela Calla, AMP

Jim Flaherty says interest rates are heading higher regardless of central bank actions

Interest rates are going to go up over the long term regardless of what central banks do at the moment, Finance Minister Jim Flaherty said on Thursday after the European Central Bank unexpectedly trimmed rates.

Flaherty told reporters in Toronto that people “should anticipate over the long term, interest rates will go up regardless of what central banks do now.”

http://business.financialpost.com/2013/11/07/jim-flaherty-says-interest-rates-are-heading-higher-regardless-of-central-bank-actions/

This is one of the many reasons it’s important that you have the right mortgage strategy in place to protect you from payment shock in the future. To ensure you have the best possible mortgage strategy please contact us directly at 604-802-3983 or callateam@dominionlending.ca

Angela Calla

Dominion Lending Cetres

There are numerous reasons why homeowners choose to refinance their mortgages – everything from debt consolidation to freeing up money for their child’s education to using their home equity to buy another property. But the most popular reason for refinancing at this time of year is for holiday gift buying and entertainment.

Planning ahead really can save you money down the road. And with the high-cost holiday gift-buying and entertaining season quickly approaching, this may be the perfect time to refinance your mortgage and free up some money instead of relying on high-interest unsecured credit such as credit cards and lines of credit.

You may find that taking equity out of your home will help bring joy back into your holiday season – and start the New Year off on a debt-free note, as you may also be able to use some of the equity in your home to pay off high-interest debt such as your credit card and/or line of credit balances. This will enable you to put more money in your bank account each month.

And since interest rates continue to hover near historic lows, switching to a lower rate may save you a lot of money – possibly thousands of dollars per year.

There are penalties for paying your mortgage loan out prior to renewal, but these could be offset by the lower rates and extra money you could acquire through a refinance. I can sit down with you and work through all of the equations to ensure this is the right move for you.

With access to more money, you’ll be better able to manage both your holiday spending and existing debt.

Paying your mortgage down faster
By refinancing, you may extend the time it will take to pay off your mortgage, but there are many ways to pay down your mortgage sooner to save you thousands of dollars in interest payments. Most mortgage products, for instance, include prepayment privileges that enable you to pay up to 20% of the principal (the true value of your mortgage minus the interest payments) per calendar year. This will also help reduce your amortization period (the length of your mortgage), which, in turn, saves you money.

You can also increase the frequency of your mortgage payments by opting for accelerated bi-weekly payments. Not to be confused with semi-monthly mortgage payments (24 payments per year), accelerated bi-weekly mortgage payments (26 payments per year) will not only pay your mortgage off quicker, but it’s guaranteed to save you a significant amount of money over the term of your mortgage.

By refinancing now – before the holiday season is in full swing – and planning ahead, you can put yourself and your family in a better financial position.

As always, if you have any questions about refinancing, reducing debt or paying down your mortgage quicker, I’m here to help!

Angela Calla Mortgage Team

604-802-3983 callateam@dominionlending.ca

A major TV news program calls out TD Canada Trust’s collateral mortgage.  CBC Marketplace aired an episode called ‘Busting the Banks’ on January 25th.  If you want to skip to the video link, just click here and scroll to the 8:00 min mark.

During the program, CBC took a hidden camera into a TD branch….the reporter posed as a potential mortgage borrower….   Only when questioned for the 4th time did the TD banker disclose their mortgage was a collateral charge….  but they didn’t seem to explain the difference between a conventional mortgage and a collateral mortgage… The Banker only agreed that the collateral charge was a disadvantage.

The CBC reporter also produced TD mortgage documents obtained at the branch.   After a thorough search, they couldn’t find the word ‘collateral’ anywhere.   The only place they could find the word ‘collateral’ was in one document sent to the lawyer during mortgage registration.   Of course, the big problem here is that most lawyer’s get mortgage instructions from Banks around one to two weeks before closing….  A bit too late to start shopping for a new mortgage.  Leaving the consumer with no option but to proceed with the TD collateral mortgage.

WHAT’S A COLLATERAL MORTGAGE?

Collateral mortgages are more commonly used when obtaining a secured line of credit…. or a product that has revolving credit with no set amortization.  There are several other differences that affect what your current and future options will be (more on this later).  A collateral mortgage has it’s place but for the vast majority of us, I believe it’s just not the right product. The biggest problem I have is that most borrowers are unaware of what they are getting into.

Back in October 2010, TD quietly announced they would begin registering all their mortgages as collateral mortgages.   http://www.angelacalla.ca/blog_post?id=8190  the differences between collateral and conventional mortgages….  Does anyone remember this?  At the time, this was a huge story….  and yet, there was hardly no coverage…. Maybe the hundreds of millions that the BIG SIX BANKS spend in advertising each year has something to do with the lack of coverage.?

I could be wrong but my feeling is that since October 2010, the majority of TD clients have no idea their mortgage is registered as a collateral charge…..they will only find out once they go to refinance, renew or make a change with their mortgage…

I applaud CBC Marketplace for taking on the BIG SIX BANKS…..and my advice is to anyone needing a mortgage is to speak to an unbiased advisor.

TD is not the only lender doing this, they just happened to be the lender CBC showcased. It is common for the credit unions as well as sometimes with aby of the big banks HSBC, CIBC, RBC, Scotia, BMO. It’s an option for some cases without question; its just very importnat for there to be transperency in the products you select and to be aware of all the the pro’s and cons.

As always we are here to help callateam@dominionlending.ca 604-802-3983

The Bank of Canada has kept interest rates low for 3 years now and while rates are low, reading between the lines make the following the top 3 take aways

1. The forcast is downgraded. This means they intend to keep there rate low, longer.

2. The variable rate mortgage will continue to be a great option for borrowers.

3. They may consider a decrease in future, as they removed the increase warning.

To ensure you have the best possible mortgage contact the Angela Calla Mortgage Team 604-802-3983 callateam@dominionlending.ca

To read more about the Bank of Canada this week see the link http://www.theglobeandmail.com/report-on-business/economy/do-not-post/article15015655/ 

We have seen a significant number of first time homebuyers reviewing their options to purchase a home, market confidence remains high.

http://www.theglobeandmail.com/news/british-columbia/bc-housing-rally-expected-to-continue-through-2014/article14979458/

Questions on the best plan for the lowest cost of home ownership? Contact the Angela Calla Mortgage Team today 604-802-3983 callateam@dominionlending.ca