Interesting article from The Financial Post…

A  few days ago, Scotiabank received permission from the Securities and Exchange  Commission (SEC) to market to US retail investors what are known as covered  bonds. In pursuing SEC approval for market access, Scotia was following a trail  blazed by RBC (market rumour has it that BMO is on the same  path). There is no madness to the approach – there is method. Change is underway in Canada’s housing finance system. More of it will be done without the taxpayer backing, or insurance, that  common financing channels currently enjoy, by way of CMHC. RBC’s covered bonds are backed by uninsured residential mortgages – so too will be Scotia’s, in  future, and so will others. Lenders, mostly banks, who have not already   developed the financial instruments and skills to diversify their funding   sources will do so, because they must. This is all to the good. Background: CMHC, a Second World  War era Crown agency intended to help returning vets find homes to live in,  until recently grew in leaps and bounds. CMHC became a source of systemic risk  because its mortgage insurance products, which insulate lenders from loss when  the loans they make go bad, for years backstopped easy loans, mortgages with  long amortizations, and cheap home equity lines of credit that Canadian   consumers took up in droves. As  consumer debt rose, and housing investment bubbled, so did Canadian house prices  over the past decade, well outstripping income growth. Low interest rates  helped, but so too did easy credit terms – with few incentives, owing to CMHC  insurance, for lenders to hold back on extending them.

Full Article…

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-Cory Kline 705-794-1283

Mortgage Planning since 1998

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“Call Cory for a FREE second opinion on your mortgage”

Many city residents will have the day off on Good Friday and Easter Sunday, including those who work in most retail stores, grocery stores and liquor stores.

Click on link for a full list of what will be open and closed over the holiday weekend…

Good Friday: March 29

Closed: Government offices, Banks, LCBO and Beer stores, shopping malls, Schools, Canada Post.

Easter Sunday: March 31

Closed: LCBO and Beer stores, Shopping centres.

Easter Monday: April 1

Closed: Government offices, Schools, Post office.

Source: CP24

1. How long have you been in the business? (Ideally, at least two to five years) 15 years

2. How many lenders does your team have “top-tier status” with? (Preferably six to seven or more)10+

3. Is the rate you’re quoting me the lowest rate for that term on that lender’s broker rate sheet? (If not, why not?) Sometimes the special conditions are not consumer friendly. I will show you all your options and we will review the pro’s and con’s, including penalty structure and lender stipulations. Some specials are quick close specials.

4. How much volume did your team do last year? (Ideally $100-million-plus)Well over 500 million.

5. Do you do over 50 per cent of your business with one lender? (If so, why?)Definitely not.

Industry News

While the Bank of Canada acknowledges the economic outlook here and elsewhere “is slightly weaker” than thought, policymakers are also offering up some hope for the near future.

In a nutshell, Canada’s economy is growing at a slower pace than expected – although a pickup is likely later this year – and inflation remains weak at near recession levels, for now, while consumer debt and the housing market appear to be stabilizing, if not cooling. At the same time, the global outlook has also slowed, while fiscal and debt concerns in the United States and Europe have dissipated slightly.

The bottom line for Canada: Interest rates aren’t going anywhere soon.

Today, for the first time, policymakers combined their regular-rate decision announcement with the bank’s Monetary Policy Report, a closely-watched quarterly reading on domestic and global factors affecting the economy.

As expected, the Bank of Canada kept a lid on borrowing costs, with its trendsetting overnight rate – the main instrument used to guide inflation toward the bank’s 2% target – remaining at a near-record low 1%, unchanged since September 2010 and now the longest dormant stretch since the early 1950s.

The only wrinkle in its usually pact statement accompanying a rate announcement was to highlight “the more muted inflation outlook and the beginning of a more constructive evolution of imbalances in the household sector,” adding that “the timing of any such withdrawal is less imminent than previously anticipated.”

Click here to read more from the Financial Post.

If you require guidance on current market trends, please call us, we are always available to help.

Today 5 year mortgage money is in the 2.98% range and 10 year money from 3.79%. Variable rates are as low as 2.65%.

Thank you,

–Cory Kline (Cory @NDLC.CA or 705-794-1283)

Mortgage Planning since 1998