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Beyond the Rate: The “Self-Employed” Question

This is the second post in a new blog series, Beyond the Rate, in which our team will use detailed examples to show you why you need be thinking about more factors in your mortgage search than just locking down the best interest rate. “What rate did you get?” is a hot-topic question right after a home is purchased. A low rate seems to mean mortgage victory. And when you’re considering your options, it may seem like a no-brainer: the one with the lowest rate should be the winner, right? It’s time to challenge that assumption. Let’s do that by looking at a situation that affects many Canadians: the case of the self-employed. If you’re self-employed, it can be downright

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Beyond the Rate: Mortgage Penalties

This is the first post in a new blog series, Beyond the Rate, in which our team will use detailed examples to show you why you need be thinking about more factors in your mortgage search than just locking down the best interest rate. A mortgage is more than just a loan. It could be the key to securing a home for you and your family. Or, it might be a way of refinancing your home to start the business you’ve always been dreaming of. Maybe it’s an option that you’re considering to help you deal with unexpected debts – because you never know what kind of curve balls life might throw in your direction. No matter how you say

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What are the penalties if you cancel early?

Most people feel their job is secure, their relationship is in great shape, and that they won’t need to move. And so they agree to crippling penalties if they choose to break their mortgage contract before its expiry date.

New mortgage rules change the game

In October 2016, the Canadian government announced sweeping changes to mortgage applications , aimed at protecting the financial security of Canadians, while supporting the long term stability of the housing market in Canada. The key changes are: Tighter insurance rules – when a home buyer has less than 20% down, the mortgage must be insured. This insurance provides security to the lender in the event of home buyer default. Stringent rules previously applied only to “high ratio” (lowest down payment) mortgages now apply to all insured mortgages. Stress Tests – banks pre-approve mortgage amounts based on the home’s carrying costs not exceeding a certain percentage of a buyer’s income. New “stress tests” on insured mortgages establish this amount based on the Bank of

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Are you signing a collateral mortgage?

We are experiencing the lowest interest rates in Canadian history. Although the cost of a house or condo is higher than ever, it has never cost us less to finance one. And so, banks are aggressively marketing low mortgage rates. As homeowners, we feel like we’re the winners – it’s a race to the bottom, and we’re happy to watch it happen. But amidst all of the low rate fanfare, we need to remember that banks are profit-focused corporations. If rates are lower, their profits on those mortgages are lower. Therefore, other strategies must be employed if banks are to meet the expectations of their shareholders. Borrowers who switch lenders at renewal time have always been a threat to banks. Therefore, they

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