Mortgage Blog - Mortgage News
Would You Like A Mortgage With That IPhone?
September 7, 2011 by Jennifer Cookson
Rogers Communications has recently applied to the federal government for a banking license so that along with your phone cable and Internet services, they can perhaps one day give you a mortgage.
At this point, Rogers says it isn’t really interested in become a full-service deposit-taking financial institution at this time so mortgage and lines of credit probably won’t be on the horizon in the near future but because many customers pay their Rogers bill with a credit card, they’ve decided they’d like a piece of that action.
In addition, according to an article in Moneyville ...
Read more »Interview Regarding Cash-Back Mortgages
August 29, 2011 by Gordon McCallum
“If the client absolutely isn’t prepared to wait to save a down payment,” McCallum told MortgageBrokerNews.ca, “there are still better, cheaper options brokers need to be offering them, other than a cash-back.”
The above is a direct quote from the interview I did late last week for a new article at MortgageBrokerNews.ca.
One of the questions we get most often here at First Foundation is whether or not someone can purchase a home without a down payment. There are many reasons why someone might not have a down payments, such as:
- Just graduated from post-secondary and haven ...
Read more »June 2011 CAAMP Statistics
June 8, 2011 by Jennifer Cookson
Every month we publish the statistics that the Canadian Association of Accredited Mortgage Professionals (CAAMP) sends us as a service to our readers.
Click here to see the most recent stats regarding the following:
Bank of Canada Interest Rate
Government of Canada Bonds
Bank Prime Lending Rate
Total New Housing Starts
Conventional Mortgage – 5 Year Rate
Average MLS® Resale Price for Local Markets
US Federal Reserve Board Discount Rate
Quarterly Housing Affordability Index
Exchange Rate $CDN($US)
Canadian Mortgage Borrowers Exhibiting Confidence, Says CAAMP Survey
May 12, 2011 by Jennifer Cookson
CAAMP Press Release (May 11, 2011)
Canadian mortgage borrowers exhibit confidence according to the spring survey report on the residential mortgage market produced by the Canadian Association of Accredited Mortgage Professionals (CAAMP)
Many Canadians are aggressively reducing their mortgages by making lump sum payments, increasing monthly payments and reducing amortization periods, revealing confidence and financial flexibility in a stable mortgage environment, according to CAAMP’s most recent survey report.
The spring survey report, entitled Stability in the Canadian Mortgage Market, is a bi-annual review of the Canadian mortgage market authored by CAAMP Chief Economist Will Dunning. The report is based ...
Read more »No Need To Tighten Mortgage Rules Again, Says Flaherty
May 11, 2011 by Jennifer Cooksoon
According to an article in Tuesday’s Financial Post, Finance Minister Jim Flaherty says there is no need for further tightening of mortgage rules in Canada. In his first appearance since the election, Flaherty commented at the Bloomberg’s Canada Economic Summit in Toronto that there has “already been some softening” in the Canadian real estate market, therefore doing away with the need for further intervention.
Here’s an excerpt from the article:
“Unlike the United States and Europe, the Canadian housing market has continued to rise after the financial crisis, leading some observers to caution we could be headed ...
Read more »Press Release - First Foundation Acquired by M-A-C Cosmetics
April 1, 2011 by Gordon McCallum
For Immediate Release
Edmonton, Alberta, April 1, 2011 – First Foundation Residential Mortgages Announces Acquisition by M-A-C Cosmetics
First Foundation Inc., operating in Alberta as First Foundation Residential Mortgages, today announced that the company has been acquired by M-A-C Cosmetics for an undisclosed amount.
“We’re incredibly excited about the opportunities that lay ahead of us now that we are part of the M-A-C family,” said First Foundation founder and President, Gordon McCallum. “At first blush, the synergies in our relationship might seem hard to outline, but we’re confident that we’ll be able to lay a solid foundation for ...
Read more »New Mortgage Rules in Effect Today
March 18, 2011 by Gordon McCallum
Today, March 18, 2011 the new Government of Canada mortgage rules go into effect. Here is a summary of what to expect:
Amortization Periods
Mortgage borrowers, whether buying, refinancing, or renewing, will be subject to a maximum 30 year amortization period on all insured mortgages. That is, if your mortgage is insured by CMHC, Genworth, or Canada Guaranty, you will only be able to amortize your mortgage over 30 years. This is down from previous highs of 35 years and 40 years over the past few years.
The goal here is to ensure that people make responsible borrowing decisions and ...
Read more »CMHC Defends Itself to It's Critics
February 14, 2011 by Jennifer Cookson
Canada Mortgage and Housing Corporation has taken the unusual step of publicly challenging its critics, defending its reputation and its business model as calls for change pile up.
On Monday, the Crown corporation sent the news media copies of letters that its vice-president had sent to three think tanks which recently published research reports critical of the extensive role that CMHC plays in the housing market and the risk that it creates for taxpayers.
All the hub bub comes on the heels of the Obama administration intoning last Friday that it believes the US should no longer play a major ...
Read more »Market and Mortgage News - Week of Feb.07th, 2011 - Edmonton & Calgary
February 10, 2011 by Jennifer Cookson
First Foundation Best Rates to Open the Week:
Term Mortgage Rates
1 Year 2.70%
2 Year 3.10%
3 Year 3.35%
4 Year 3.69%
5 Year 3.69%
7 Year 4.80%
10 Year 5.15%
ARM / Variable 2.20%
Prime Rate 3.00%
Qualifying Rate 5.19%
Market News
Toronto’s main stock index closed modestly higher Monday as financial shares gained on increased confidence in economic recovery. Crude prices fell as concerns eased over Egypt’s political crisis and how it might affect oil flows in the Middle East.
The S&P/TSX composite index ...
Read more »Mortgage Matters - New Canadian Mortgage Rules (Video)
February 2, 2011 by Gordon McCallum
Well, hopefully subsequent videos will be a bit more entertaining! This is my first shot at doing video, so, while I appreciate your feedback and comments, please be gentle! :)
—Gord
Read more »Flaherty Announces New Mortgage Rules - How Will They Impact You?
January 18, 2011 by Jennifer Cookson
Federal Finance Minister Jim Flaherty announced tighter mortgage rules on Monday to address concerns over high Canadian household debt. According to the Department of Finance’s press release the adjustments were made in an attempt, “to support the long-term stability of Canada’s housing market and support hard-working Canadian families saving through home ownership”.
The changes will impact buyers and current home owners who require mortgage default insurance provided by the Canadian Mortgage and Housing Corporation (CMHC) to purchase or refinance their homes. It is a requirement to have this type of insurance if you are putting down less than ...
Read more »Revealing Mortgage Broker Study
January 13, 2011 by Jennifer Cookson
A study done by Maritz Research reveals some very interesting stats about mortgage brokers and Canadian homebuyers. Here’s a sampling of the stats:
- Brokers have the top market share of brand new mortgage originations (40%) but hold only a 23% share of the renewal market (which includes early renewals and renewals at maturity).
- However, those renewing through a mortgage broker saved approximately 40 basis points on their rate versus those who renewed elsewhere (or with their current lender).
- Maritz found that low rates are the number one factor for clients when making “their initial mortgage placement decision.” Rates are ...
Renting? New Year A Good Time to Become A Homeowner
December 9, 2010 by Jennifer Cookson
If you’re currently renting in Edmonton, 2011 may be the right year to consider becoming a homeowner. The Canadian Mortgage and Housing Corporation ( CMHC) said Thursday that the vacancy rate for rental apartments will drop to about 3.5 per cent by the fall of 2011 as the economy improves. In response, rents are expected to increase.
A typical two-bedroom unit is expected to rent for nearly $1,035 in 2011, which is an increase of $20 and townhouses have already gone up to $1,127 a month, a $46 increase since October 2009. Along with a hike to ...
Read more »Getting a Mortgage? Have You and Your Spouse Had "The Talk" ?
November 2, 2010 by Jennifer Cookson
Next to the conversation where you tell your husband that your shih tzu ate the bathroom door, I think we can all agree that money is the next most stressful chat you can have with your spouse. Just me with the shih tzu thing? OK – then money makes number one for most everybody else.
From a professional stand point, I can tell you that if you don’t have a talk about your personal history with money with your spouse in the privacy of your own home, you’ll be having it in your mortgage brokers office and there’s ...
Read more »Canadian Mortgage Brokers Here to Stay
October 28, 2010 by Jennifer Cookson
Mortgage brokers will remain a fixture in the Canadian mortgage distribution landscape—and Canadian mortgage holders will ultimately benefit as a result.
These are the findings of the new report by Deloitte, “Winning Strategies in the Brokered Mortgage Marketplace”, which provides an overview of the current state of the Canadian mortgage industry.
The report comments that, ” over the last decade, an increasing number of viable options for borrowers have surfaced. In addition to the traditional options available at bank branches, Canadians seeking a mortgage can now consult the banks’ own mobile mortgage specialists as well as independent mortgage brokers – while ...
Read more »Mortgage Hilarity...
October 22, 2010 by Jennifer Cookson
Here’s a bit of fun for the weekend…
A friend of mine was in a line up this week to vote and after about a half hour of waiting, the young fella behind her says, ” Isn’t there and app for this?”. Love it. I figure they should have done the whole thing on Facebook and whoever has the most friends, wins.
Also, Cameron Wake, once a mortgage broker is now a “sack machine” for the Miami Dolphins. In 2006 he signed with the Giants but was cut before training camp. Wake embarked on a corporate career as a ...
Read more »Watch Out For the Tack Hiding in TD's Big Green Easy Chair
October 15, 2010 by Jennifer Cookson
TD will be launching a new mortgage program this week that will be sold to their clients as being comfortable, supportive and really good for them, a lot like that over stuff green leather chair we’re all familiar with. But there’s a bit of a nasty surprise waiting for mortgage customers who will decide to take a seat at TD; an insidious little prick that could result in a hemorrhaging of cash.
With your standard mortgage, when your term is up, you may take your mortgage to another lender with a more competitive rate and your new lender ...
Read more »Pop Quiz - What's the Minimum Downpayment These Days?
August 10, 2010 by Jennifer Cookson
With the changes made to the mortgage rules back in April, we are seeing a bit of confusion out there over the minimum downpayment needed when buying a home. In actuality, the minimum downpayment to purchase home that you will live in personally has not actually changed – it’s still 5% of the purchase price. This applies not only to first time buyers but to anybody purchasing a personal residence or a second home that will be occupied, rent free, by a family member.
The major change in the rules regarding downpayment applied only to purchases of Rental Properties. The ...
Read more »Financial Fitness of Canadians
July 28, 2010 by Dania Spillett
Genworth Financial Canada released a survey last week that suggests Canadian homeowners are in better financial shape compared to non-homeowners. Intuitively this makes sense since you really do need to have a decent grasp on your finances in order to purchase a home, or even just to get pre-approved.
The findings demonstrated that 65% of homeowners pay of their credit card balances in full each month compared to only 38% of non-homeowners. However, only 25% of homeowners actually took advantage of pre-payment privileges and made a lump sum payment or accelerated their mortgage payments in the last year. By using ...
Read more »Update on New Mortgage Rules - Dispelling Myths
July 21, 2010 by Gordon McCallum
I’ve noticed that there seems to be some confusion in the marketplace about some of the new mortgage rules
The good news is that these rules have not impacted the broadest section of the market as much as some had anticipated. As a quick summary, I’ve listed the major changes below – along with a counterpoint which allows you to still qualify in most cases:
1. Home buyers need to qualify at the Bank of Canada Qualifying Rate instead of the contract rate on mortgage terms less than 5 years or on variables.
Suggestion: get a five year fixed ...
Read more »New Mortgage Rules Start Today
April 19, 2010 by Gordon McCallum
Just a reminder that the new Canadian Mortgage Rules go into effect today. As a quick summary, there are three main changes that you’ll need to remember:
1. Home buyers need to pass a new qualification test: can you afford this home at the 5-year fixed rate? If you take a term shorter than five years you’re going to have to qualify at the new Bank of Canada “qualification rate”.
2. Maximum refinancing to 90% of the value – down from 95%. If you need to refinance, you’ll only be able to access 90% of the value of ...
Read more »New CMHC Rules for Stated Income Self Employed Borrowers
April 9, 2010 by Gordon McCallum
CMHC‘s new rules for “stated income” self-employed borrowers go into effect today. As a reminder, here are the new rules:
Please Note – these new rules only apply if you can’t prove your income using the traditional methods
Maximum Loan-To-Value (LTV):
- Purchase Transactions 90% (down from 95% LTV)
- Refinance Transactions 85% (down from 90% LTV)
Essentially this means that, in order to qualify under the CMHC “Business for Self” program you’ll need to put a minimum of 10% down if you’re buying a home, and if you’re refinancing you’ll only be able to access up ...
Read more »Global Regulation Threatens Canadian Mortgage Market
April 9, 2010 by Gordon McCallum
Most of you have heard the expression, “One bad apple ruins the whole bunch.” No doubt this is true. The same can’t be said, unfortunately if you’re the only good apple in the bunch.
I’ve often said that Canada has taken a bit too much credit for being clairvoyant and avoiding the subprime mess that the States got into, because the truth is that we were saved by time. The US was the canary in our mine. We ran out of race track before we got too heavily invested in subprime mortgages, but believe me – it was ...
Read more »First Foundation Newsletter - March 2010
March 25, 2010 by Gordon McCallum
In this issue:
- New Canadian Mortgage Rules – what they are, and how they’ll affect you.
* Rate Update
* Rates: When are they going up, and what should I do about it?
* Canadian Mortgage Awards – we need your vote!
New Canadian Mortgage Rules – In Effect April 19th, 2010
1. All high-ratio insured mortgages in Canada that have a variable rate or a fixed rate for a term shorter than five years will need to qualify borrowers based on the higher of the “contract rate” or the 5-year “qualifying rate” set by the Government of Canada, which incidentally, is the same as ...
Read more »New for 2009 Tax Year: Home Buyer's Tax Credit
January 7, 2010 by Shayla Damery
It’s almost tax season again, and you know how I can tell? I received my tax package in the mail yesterday. Being the numbers nerd that I am (I get excited about doing my taxes), I had to open it up and flip through the tax guide to get an idea of what kinds of credits, etc. that I would qualify for in the 2009 tax year. Something that was highlighted in the package is a new program for 2009 and subsequent tax years that I wasn’t aware of: the Home Buyer’s Tax Credit.
Basically, you’re ...
Read more »Orphaned Borrowers - And Why First Foundation Doesn't Do Subprime Mortgages
December 9, 2009 by Gordon McCallum
We’ve often been asked over the years why we don’t offer borrowers with beat up credit, unverifiable income, loads of debt, or other financial difficulties a mortgage.
After all, mortgage brokers can make a lot of money charging high fees and/or earning big commissions on sub-prime mortgages, because they’re usually offering them to people who are desperate. Justifying their actions is easy, because the broker is really that person’s only hope.
We don’t do it. We never have. We can’t justify it. Taking advantage of people who need help is never justified and ...
Read more »Mortgage Market Weekly Summary - October 2 2009
October 1, 2009 by Gordon McCallum
It’s been another wild and woolly week in mortgage land. It’s actually been quite encouraging to see applications on the way up to end September / start October and really, with interest rates as low as they are and relatively nice weather, why wouldn’t they be?
I’ve got a few bits of news and analysis for you this week from other sources around the web, consolidated here at good ol’ firstfoundation.ca for your reading pleasure:
- Want a mortgage crystal ball? Watch the bond yields – especially the 5-year. One of our lenders tells us that they’re ...
Read more »Mortgage Blog - Weekly Roundup
September 10, 2009 by Gordon McCallum
Wow! It’s been a busy week in mortgage land. Nice to see things aren’t slowing down too much for the fall period.
I think we’re probably going to see a burst of activity now that the news is out there of an economic rebound in Canada. There are better job numbers, better housing numbers, and better economic numbers all around. Interest rates are nice and low still but are expected to pop up a bit early to mid next year, so the fourth quarter of 2009 might be the perfect opportunity for bargain hunters to buy a ...
Read more »First Time Buyers Benefit
January 28, 2009 by Gordon McCallum
I did a little more digging this morning on the details of the federal budget which was announced yesterday…and I found some more good news for those thinking about buying their first home. Here are the details:
- First time home buyers will qualify for a 15% tax credit, up to $750 worth of savings, on closing costs of up to $5,000. I would assume that legal fees and moving costs are the primary areas where people will save.
* First time buyers will also see the “Home Buyer’s Plan” limit go from $20,000 to $25,000. The ...
Government Guaranteed Mortgages and the New Rules
July 31, 2008 by Shayla Damery
As many of you have probably heard by now, the Finance Minister has made some changes to government guaranteed mortgages. But what a lot of Canadians may not know is exactly what changes were made, and why.
What is the government guarantee?
Most people know that mortgage insurance is the premium you must pay if you have a high-ratio (less than 20% down payment) mortgage, so that lenders are able to pay their investors in the event you default. But what happens if a large amount of mortgage borrowers can't make their payments, and they all default? The mortgage ...
Read more »MCAP Introduces New Product FlexStar
October 25, 2007 by Shayla Damery
On October 1, 2007, MCAP introduced a new mortgage product called FlexStar. FlexStar is a re-advanceable mortgage whose rate is variable and floats according to the prime lending rate. With FlexStar, you can make minimum payments of interest-only for 10 or 25 years, and you can repay up to 50% of the principal amount in the first five years. After five years, the FlexStar product is completely open (meaning that you can pay off as much as you want, when you want).
FlexStar allows you to re-draw funds from your mortgage that you have already paid off, up to the ...
Read more »The American Sub-prime Mortgage Market...and Canada
September 20, 2007 by Shayla Damery
Sub-prime mortgages are mortgages for those people who don't normally qualify for the lowest interest rates or the best mortgage products based on their tarnished or poor credit histories. They can, however, still qualify for a mortgage, but will end up paying higher interest rates and/or fees.
Recently, there has been a bit of a meltdown in the United States in the sub-prime mortgage market (or the alternative mortgage market, as we know it in Canada). Sub-prime borrowers have started defaulting on their mortgages en masse in recent months due to rising interest rates, extensive use of adjustable ...
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