It’s no secret. Many homebuyers that had no trouble qualifying for a mortgage in 2017 are finding big challenges in 2019. As we wrote yesterday, the government’s harsher mortgage “stress test” is a key reason why. The problem is exacerbated by the banks’ refusal to lower their posted 5-year fixed rates, despite a 55-basis-point drop in the 5-year bond yield...

“You usually need to be in a recession to see household credit rising this slowly.”—Ben Tal, CIBC Here’s something everyone in the mortgage industry already knew, and CIBC just re-confirmed. The government’s mortgage stress tests have caused most of Canada’s lending slowdown since 2017. That’s the conclusion of CIBC Economics. As a result, the bank’s widely-respected econo-wizard Benjamin Tal concludes, “…Regulators should...

Can anyone remember the last time 3-year fixed rates were the lowest widely available conventional mortgage rates? We can’t. But that’s now the case if you’re putting 20% down. For most well-qualified borrowers with 20-29.99% equity, we’d venture to say there’s no better deal right now than the three-year. Not a 1-year fixed, not a 2-year fixed, not even a...

Interested in a rock-bottom rate you see online? You better understand its stipulations. Mortgage rates aren’t as straightforward as people think. The competitiveness of your mortgage rate is heavily influenced by whether your mortgage can be default insured. In some cases—like when you’re buying a home with less than a 20% down payment—you have no choice. You must buy default...

The most competitive online mortgage brokers are just itching to give you a better rate. But many lenders won’t let them. Most broker lenders have what’s called “rate buydown limits.” In other words, the lender limits how much a mortgage broker can reduce your interest rate by giving up some of their commission. Here’s a simple example. Suppose a lender...

In Canada, the cheapest mortgage rates are usually available on insured (or insurable) mortgages. But refinances cannot be insured thanks to rule changes in 2016. That’s been a problem for folks with existing mortgages—particularly those who have “collateral charges.” Collateral charges are mortgages that readvance or have a line of credit attached to them. Examples include the: RBC Homeline Scotiabank...

Think you’re going to be materially better off in the next two years? Odds are, you’ll get a bigger mortgage than someone who doesn’t. That’s StatsCan’s finding in this just-released study. “Families with positive expectations about their financial situation…held about $27,900 more in mortgage debt than other comparable families during the period from 1999 to 2016,” StatsCan said. That’s like a 38% bigger mortgage. The more...

If you’ve been waiting for facts on the government’s new First-Time Home Buyer Incentive (FTHBI), read on. In a statement today, CMHC said “we still have work to do” before bringing it to market. Among other things, it says: “…The proposal requires some government approvals.” “We also plan to consult with lenders and other industry participants to make sure the...

The latest happenings from the rate world: HSBC Won’t Let Up Despite moving to an everyday-low-rate online model a few years ago, competitors keep thinking (or maybe hoping) that HSBC is just a flash in the pan. Then it does what it did today. The bank hammered rates lower this morning, to: 2.74% for insured 5-year fixed mortgages (down 15...

It’s been two and a half years since Ontario’s biggest credit union (Meridian) announced its new digital bank (motusbank), and now it’s here. motusbank brings mortgage shoppers one helluva good offering. For one thing, its process is super easy and fully online. That’s becoming mandatory for time-pressed, smartphone-addicted borrowers. More importantly, by eschewing bricks and mortars, the bank can trim...