Mortgage Rates as of January 25, 2010
CREATIVE MORTGAGECORP.
January 25, 2010 - Mortgage News and Rates
Rates Stay Flat
Last Tuesday the Bank of Canada met for the first time in the New Year. Even though the economy is recovering much quicker than the Bank of Canada had originally anticipated in October, the economy still remains fragile. There are two predominant reasons for this, a high Canadian dollar and continued weak demand from the US. Overall, the Bank of Canada feels that the economy is relatively balanced with a little more weight tilting towards inflation which is largely caused by the extremely low interest rates. http://www.financialpost.com/news-sectors/economy/story.html?id=2458992 No Housing Bubble
The Bank of Canada has come out and said that we are not currently experiencing a housing bubble even though we are close to the housing prices that peaked in 2008. The Bank of Canada claims that the housing recovery which we are currently encountering is due more to temporary factors. They view the housing recovery as an essential key to Canada's overall economy recovering. The fact that they have taken notice of the quick rise in housing and yet move to quell any fears of a rate hike shows that they are truly aware of the situation but are against raising rates to solely calm the housing market. The Bank of Canada fears that an interest rate hike will hurt the economy more than it will help it. This is why there appears to be a better chance of the government intervening on the housing market by increasing regulations such as larger down payments and shorter amortizations on mortgages, than the Bank of Canada stepping in and raising rates. http://www.reuters.com/article/idUSN1116060820100111?type=usDollarRpt
Mortgage Broker Demand
More and more Canadian homebuyers are turning to mortgage brokers to help them obtain a mortgage. In the past, especially within the older generations, if someone required a mortgage they would go to their banking institution and accept whatever rate was offered to them. If they really didn't like the rate, they would go from bank to bank in search of the best rate. This is a waste of the consumer’s important time and in addition may hamper their credit score as all Banks will pull a credit bureau in order to give an approval to the client. What makes us so attractive compared to the typical bank is that we work for our clients and not for the lenders. We search to find the best possible rate and lender that best suits each client’s unique situation. The major banks also tend to only lend to the clients who have perfect credit scores, high salaries and large down payments. For all the other homebuyers who do not meet the perfect criteria required, we can help them find a lender who will work with the client’s strengths to assist them in obtaining their mortgage. http://www.mortgagebrokernews.ca/news/43523/details.aspx
US Mortgage Defaults
Much has come from the real estate meltdown in the US. Basically it was the epicentre of the global credit crisis and eventual meltdown of easy credit. We have attached an interesting article from the Wall Street Journal which looks at the US government’s different strategies to try to correct the negative equity that homeowners currently have, which will allow more of the consumers to keep their homes rather than defaulting into foreclosure. A startling message at the end shows how in the past people who defaulted on their mortgages were being shunned and now they are being viewed as doing the right thing. http://newzfor.me/news/3664178.aspx
Prep Buyers for 2010
Here is a great article from the Globe and Mail showing what your clients should be doing when it comes to purchasing real estate in 2010. http://www.theglobeandmail.com/real-estate/home-buyer-prep-for-2010/article1431196/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed:+TheGlobeAndMail-RealEstate+(The+Globe+and+Mail+-+Real+Estate+News)
What We Do For Your Valued Clients:
Our main objective in working with your clients is to educate them on their financing options as well as provide them with adequate financing to help them purchase their home, investment or vacation property. We help clients see what they are capable of affording based on the rates we are able to offer. With our ability to fund rates with a high efficiency, we are able to pass along special rates that lenders offer us to your clients. We have the ability to set up mortgages all across Canada.
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Our 5 year fixed rate sits at 3.75% which dropped again this week. The variable ratealso dropped this week and now sit at Prime - 0.25% (2.0%) on a 5 year term and Prime - 0.30% (1.95%) on a 3 year term.
BROKER’S BEST RATES
TERM | RATE* | PMT/$1,000** | APR |
1 YEAR CLOSED | 2.25% | $3.44/$1,000 | 2.26% |
2 YEAR CLOSED | 2.85% | $3.76/$1,000 | 2.87% |
3 YEAR CLOSED | 3.25% | $3.98/$1,000 | 3.28% |
5 YEAR CLOSED | 3.75% | $4.26/$1,000 | 3.79% |
7 YEAR CLOSED | 5.25% | $5.17/$1,000 | 5.32% |
10 YEAR CLOSED | 5.35% | $5.23/$1,000 | 5.42% |
3 YEAR VARIABLE | PRIME - 0.30% | $3.28/$1,000 | 1.96% |
5 YEAR VARIABLE | PRIME - 0.25% | $3.31/$1,000 | 2.01% |
PRIME RATE 2.25%
For more information give us a call
Shaun Pierce, AMP Lesley Pierce, AMP
Mortgage Consultant Mortgage Consultant
(250) 717 – 8949 (Ext. 102) (250) 717 – 8949 (Ext. 103)
Paul Cescon, BBA
Mortgage Consultant
(250) 717 – 8949 (Ext. 101)
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* Rates are subject to change and Lenders approval
** Payments based on a 35 year amortization and monthly payments
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