The Super Broker, Author at SuperBrokers

Rising Canadian Mortgage Balances could see Downward Shift

Amidst falling housing prices, Canadian mortgage balances have risen for nearly a third of Canadian home owners.

Data collected by Ipsos Reid’s Canadian Financial Monitor reveals that in the last 48 months, the average Canadian mortgage has seen a significant 36 per cent increase. While the same percentage of households possess mortgages now as they did four years ago, about one third of the populace, the average mortgage balance has risen since 2006.

The last four years also saw a marginal 3 per cent increase in mortgage holders opting for variable rates over fixed. Still, the vast majority of Canadians select fixed rates on their mortgage products; about 70 per cent.

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Private Mortgage Insurers Re-Surface in Canada

In recovery from the mid-2007 crisis faced by mortgage default insurance companies, private mortgage insurance has become popular once again.

Private Mortgage Insurers Canada

By mid-2007, mortgage default insurers had faced two turbulent years. They had watched their market shares plummet by a whopping 50 per cent and, in turn, the media coined them “unsustainable”. In the last year, however, these private mortgage insurers have seemingly regained their momentum. Genworth Canada has recently reported a 71 per cent increase in new insurance written, so far this year, and $85-million in profit.

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What to Look for in a Mortgage Broker

With a growing number of brokers entering the Canadian mortgage market, how do you find the one that will work best for you?

So, you’re ready to purchase a home.

If you enlist the services of a qualified and professional mortgage broker, then you can be sure that they will work diligently to secure you the best terms and rates available on a product that fits your needs. In addition, they will guide you through the whole home buying process.

But with a growing number of brokers entering the Canadian mortgage market, how do you find the one that will work best for you?

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Canadian Home Renovation Statistics

50 per cent of (or 2.1 million) Canadian households renovated their homes in 2009, and just over 40 per cent intend to this year.

According to a recent survey published by the Canada Mortgage and Housing Corportation (CMHC), 50 per cent of (or 2.1 million) Canadian households renovated their homes in 2009, and just over 40 per cent intend to this year. The survey took information from homeowners dwelling in the 10 largest Canadian housing markets: Vancouver, Edmonton, Calgary, Winnipeg, Toronto, Ottawa, Montreal, Quebec, Halifax and St. John’s.

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Falling Housing Prices Mean It's Time To Act

When home values begin to decline, it ‘s best to take action before lenders and home insurers start narrowing their allowances

When home values begin to decline, it‘s best to take action before lenders and home insurers start narrowing their allowances. This is especially true in cases where refinancing and home lines of credit are concerned.

Many lenders require that a potential borrower has at least 20 to 25 per cent equity in the home from which they intend to draw a Home Equity Line of Credit (HELOC). In other words, if housing values fall and you lose, for example, five per cent of the equity you have amassed, you may also lose your ability to qualify altogether.

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HSBC Closes Doors to Mortgage Brokers

HSBC mortgage products were often attributed lengthy turnaround times, and only put forward occasional rate promotions.

After a move to deal only with its top 100 brokers was initiated last year, HSBC Canada has decided to end even those arrangements and handle mortgages solely online or over the phone directly through their own employees. The bank will, however, honour all agreements with mortgage brokers currently in existence.

“We plan to concentrate on growing our business through our network of over 140 bank branches,” HSBC Bank Canada spokeswoman Sharon Wilks said.

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Canadians Increasingly Looking to Hybrid Mortgage Products

Hybrid mortgages grant homeowners the best of both mortgage rate worlds and manage risk.

Nearly half of the prospective homebuyers aiming to purchase property over the next two years are intending to do so with a hybrid mortgage, says a recent survey conducted by the Royal Bank of Canada.

These numbers are up eight per cent from those attained in the same survey conducted by RBC last year. Yet, according to the Canadian Association of Accredited Mortgage Professionals (CAAMP), virtually all Canadian homeowners with mortgages currently, or 94 per cent, have either a fixed rate or a variable mortgage. This means that only a potential six per cent of the market has actually committed to a hybrid mortgage.

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Mortgage Insurance is Not Just for High Ratio Loans

Mortgage insurance protects the lender in the event the mortgagor defaults on their mortgage payments.

Though mortgage default insurance is required in Canada on loans where 80 per cent or greater of the property’s value is financed though a lender, that is not the only case when it is beneficial to obtain insurance.

According to the Canada Mortgage and Housing Corporation (CMHC), as of December 31, 2009, 71 per cent of their $472-billion in outstanding mortgage insurance was for mortgages with a loan-to-value (LTV) ratio of 80 per cent or less. Fewer than five per cent of insured mortgages were for loans with an LTV over 95 per cent, and almost 90 per cent of insured mortgagors had already amassed at least 10 per cent in equity in their home.

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Majority of First-Time Homebuyers Shop Online

A CMHC study finds that First-time homebuyers conduct virtually all of their mortgage inquiries online.

The 2010 CMHC has revealed many interesting statistics from its survey, including the trend for first-time homebuyers to conduct virtually all of their mortgage inquiries online. Findings from the 2,503 Canadians surveyed in February illustrate that:

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Higher Qualification Rates Posted by Banks

On April 19th, all banks will be using what is referred to as a ‘benchmark rate’ to see who qualifies for a mortgage.

As of April 19, all variable or fixed-rate, high-ratio insured mortgages will be qualified using either the chartered-bank five-year posted rate or the contract rate, whichever is greater. This change comes as lenders announce their new policies regarding debt servicing.

The Bank of Canada will post this qualifying rate (also known as a benchmark rate) every Monday. Some banks, including TD and Scotia Bank, appear to be applying this rate not only to high-ratio loans, but to conventional mortgages as well.

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