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How COVID-19 and Other Factors are Affecting Interest Rates in 2020

Posted onMarch 21/2020By

Most economists who specialize in banking have predicted that the Bank of Canada will not change rates, except for Scotiabank. Moreover, inflation, which was reported at 2.4% in January, is on the higher side of things, and we should note that housing prices are on an upswing, according to the most recent numbers. In addition, unemployment levels are low, and all of the trends mentioned above and numbers should place some pressure on the Bank of Canada to increase rates in 2020. Here, we will delve deeper into residential mortgages in Ontario and Canadian interest rate trends for 2020. How…

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Fixed vs. Variable Mortgage: What’s the Difference?

Posted onMarch 02/2020By

Many first-time homebuyers will need to determine if going with a fixed variable mortgage is preferable over a variable rate mortgage. Given the fact that many houses in North America cost upwards of $1 million in many of the world’s most popular cities, it makes sense to take the time to weigh the pros and cons of fixed variable mortgages and variable rate mortgages. Here, we will discuss the two mortgage types, as well as the main differences between them. Main Difference Between Fixed Variable Mortgages and Variable Rate Mortgages If you were to opt for a fixed-rate mortgage, then…

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The Truth: Why Mortgage Rates in Canada Are Cheap

Posted onJanuary 20/2020By

Although rapid skyrocketing home prices seem to be indicative of a Canadian real estate market, inversely high-interest rates are not. This hasn’t always been the case; instead, it is a new phenomenon that boasts the lowest fees in years, and it commands our attention. The National Bank reports that falling mortgage rates have made monthly carrying costs facile for borrowers, and additionally, the rates since the year’s onset continue to drop. Comprehending the decline is crucial to determine what your game plan will ultimately be when deciding to purchase a home, and whether to commit to either a fixed or variable mortgage rate. There is a substantial correlation between the mortgage market and the bond market, consequently, directly prompting interest rates to become affected. Anyone securing a mortgage on an original purchase or renewal today has a pivotal financial advantage. Banks, along with alternate lenders, safeguard the money to be…

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Canadian Interest Rates on Hold Tells a Unique Mortgage Narrative

Posted onJanuary 13/2020By

For Canadian borrowers, when the Bank of Canada (BoC) adheres to a resolute policy rate, it seems nothing short of advantageous. With this in mind, it’s imperative to establish what this authentically represents. High-interest rates are indicative of a healthy and robust economy, whereas lower fees are an incentive to stimulate spending in what is a more inefficient fiscal climate. It’s all about power. For over a year, the Bank of Canada has retained its key interest rate on hold, telling of a unique mortgage narrative that affects you. Canada, unlike its international counterparts, has been tenacious by taking fiscal control and keeping interest rates on hold. Intensified trade disaccord between the United States and China, as well as low global interest rates, have spawned ambivalence, creating a burden on the global economy. The U.S. is a crucial export market for Canadian goods and thus consequently affecting not merely our…

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Getting It Straight: Conforming Loans vs. Non-Conforming Loans

Posted onJanuary 06/2020By

Although mortgage translations are less than obvious, it’s palpable that most Canadians demand an elevated level of clarification when it comes to the pivotal commitment. A genuine comprehension of mortgage systems is trying enough, and when combined with deciphering a plethora of terminology, the task to many seems daunting. One strong example is distinguishing conforming loans from non-conforming loans. Getting it straight, once and for all, is vital. Conforming Loans A conforming loan is indicative of loan limit restrictions and, simultaneously, a number of unique preconditions are enforced. The Federal National Mortgage Association (FNMA or Fannie Mae) and Federal Home Loan Mortgage Corporation (FHLMC or Freddie Mac) are government-sponsored entities that prompt and administer the market for home loans. These agencies have definitive protocols and decrees that mortgages must observe. Statutes describe and define maximum loan amounts, advisable properties, preconditions for down payments, and credit stipulations to name a few.…

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