—The Mortgage Report: Oct. 5—
- Upstart iBuyer, Properly.ca, announced a $100-million credit line last week from Silicon Valley investors, enough to fund its nationwide growth, says CEO Anshul Ruparell. The company’s expansion will broaden options for people who want a no-stress way to sell their existing home while they go shopping for a new one.
- iBuyers, as we wrote in August, make quick guaranteed offers to home sellers. They provide a useful service if you:
- Need to show a mortgage lender that you have a firm sale (so you don’t have to prove you can carry two mortgages)
- Aren’t confident your home will sell quickly
- Believe home prices could fall and you want a backup bid.
- When Properly lists a home for sale, it offers the seller a guaranteed sale price that’s about 93% of the current estimated value. But from that, you have to deduct its 5% commission.
- “Properly will always purchase the home from our customer at the agreed upon price if it hasn’t been sold within 90 days on market,” says Ruparell. “Our customers can cancel their contract with Properly at any point in time, but Properly does not retain that same option….If Properly then resells the home for more than the price paid to the seller, 90% of any upside will be refunded back to the seller. “
- As an added convenience, for sellers who are moving to a new property, Properly waits to list their home until they move out.
- “Our customers come to us because they want to unlock their current home’s equity before having sold it (and without needing to live through showings and open houses) in order to buy their next home,” says Ruparell … Properly will professionally repair, clean, stage and market their home so that it sells for the highest possible price. It is only in the unlikely event that the home hasn’t sold within 90 days after they’ve moved into their new home that Properly will purchase their home at 93% of the originally estimated selling price. Most homes in Toronto sell on market in less than 15 days, and so if the customer ends up selling their home to Properly it is because nobody else was willing to pay more than Properly’s offer and, as a result, it is likely that they are actually selling to Properly at a value that is at or above market value.”
Another Record Low 5-year
- Just when you think 5-year fixed rates might have bottomed, the floor drops more. The lowest 5-year fixed rate in Canada is now down to 1.44% in Ontario. It applies to high-ratio default insured purchases only.
- That’s just 107 basis points above the benchmark 5-year government yield, a very small markup by historical standards. Over the long-run, this “spread” is closer to 150 bps for typical discounted mortgage rates.
- Here’s a look at what economists’ latest rate prognostications mean for mortgage term selection: Economist Rate Outlook: October
- The difference between what North American banks earn on loans and what they pay depositors is the lowest in history.
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