Tim's Mortgage News / Rates and FAQ's

[ercchry]

This quote is hidden because you are ignoring this member. Show Quote

awesome thanks.

That’s very inaccurate... but yes variable follows overnight BoC rate and fixed follows bond markets...

[Cagare]

This quote is hidden because you are ignoring this member. Show Quote

That’s very inaccurate... but yes variable follows overnight BoC rate and fixed follows bond markets...

Could you explain it accurately. I am not sure what's wrong there.

[ercchry]

All loans are funded based on the deposits held by banks... this is referred to as the “balance sheet”

Monolines (not banks) pay a premium to banks for access to their balance sheets. Insured and insurable loans (backed by cmhc, genworth, Canada guarantee) and sold off to the secondary market as securities. This way the lenders can re-lend that capital for more loans, uninsurable loans have to sit on balance sheets.

Variable/adjustable vs fixed has nothing to do with how the loans are funded. Just two ways loans can be priced, they base this pricing off those two different metrics though as with fixed they must forecast what capital will be worth in the future, hence the bond markets, where as variable is more dynamic and can be based off current capital costs

[Cagare]

This quote is hidden because you are ignoring this member. Show Quote

All loans are funded based on the deposits held by banks... this is referred to as the “balance sheet”

Monolines (not banks) pay a premium to banks for access to their balance sheets. Insured and insurable loans (backed by cmhc, genworth, Canada guarantee) and sold off to the secondary market as securities. This way the lenders can re-lend that capital for more loans, uninsurable loans have to sit on balance sheets.

Variable/adjustable vs fixed has nothing to do with how the loans are funded. Just two ways loans can be priced, they base this pricing off those two different metrics though as with fixed they must forecast what capital will be worth in the future, hence the bond markets, where as variable is more dynamic and can be based off current capital costs

Excellent explanation. I knew that loans were funded on the balance sheet. I had the thought that they would use the Bank of Canada as a back stop to their balance sheet, which is why they base their prime on BoC prime rate.

Did not understand that fixed was based on the future value of capital, but makes sense it adds up from the bond market.

[TimLacroix]

Current Rates to Open Week March 9, 2020

Prime Rate - 3.45% DECREASE by 0.50%

Special Rate Offers

5 Year Fixed - 2.29% High Ratio Purchase or Switch Only, Owner Occupied, Close in 60-90 days (some restrictions)

5 Year ARM/VRM - 2.35% High Ratio Purchase or Switch Only, Owner Occupied, Close in 90 days (some restrictions)


Full Feature Rates -- 60 to 120 day rate protection
Starting at:

3 Year Fixed - 2.44% * High Ratio
4 Year Fixed - 2.54%
5 Year Fixed - 2.29% to 2.44% * High Ratio
5 Year Fixed - 2.49% to 2.69% * Conventional

5 Year ARM/VRM - 2.45% - 2.75%

HELOC Rates Prime +0.50%

Refinance Rates
5 Year Fixed - 2.59% - 2.69%

Call or PM for MORE "UnPublished" rates or other term information.

OAC, some terms and conditions may apply, rates subject to change without notice

[The_Rural_Juror]

Why are rates "unpublished"? Are there secret rates for Aspen people?

[Brent.ff]

So where do fixed go from here?I can transfer my VRM (currently at 2.55) to 5 year fixed at 2.44. But i cant see things getting better soon

Ooof.

[TimLacroix]

This quote is hidden because you are ignoring this member. Show Quote

Why are rates "unpublished"? Are there secret rates for Aspen people?

Yes there are secret rates (LOL). Actually they are rates that lenders offer that cannot be published. Currently there are no unpublished promotions.

[TimLacroix]

This quote is hidden because you are ignoring this member. Show Quote

So where do fixed go from here?I can transfer my VRM (currently at 2.55) to 5 year fixed at 2.44. But i cant see things getting better soon

Ooof.

Yes, you will get a better rate if you transfer to a new lender as your current lender will offer you slightly higher rates. I would hold off doing anything as there is a possibility of more Bank of Canada drops.

[ExtraSlow]

This quote is hidden because you are ignoring this member. Show Quote

Yes, you will get a better rate if you transfer to a new lender as your current lender will offer you slightly higher rates. I would hold off doing anything as there is a possibility of more Bank of Canada drops.

Hold off, but not a bad time to start the paperwork process with your favourite brokers very nice sounding assistant. I have a thing for accents . . .

[TimLacroix]

This quote is hidden because you are ignoring this member. Show Quote

Hold off, but not a bad time to start the paperwork process with your favourite brokers very nice sounding assistant. I have a thing for accents . . .

hahahaha... love it ... and thanks for the plug!

[TimLacroix]

HEADS UP - WARNING

If you are looking at variable rates in the coming months for a purchase or renewal of your mortgage... do so ASAP.

A few lenders have started to change the discounts offered on the Prime rate. Currently we have seen a couple of lenders increase their discounts by as much as 0.25%. Meaning, -1.00 discounts are now 0-.75%.

If you have questions or are considering variable rates... we can hold them for 120-days giving you time to decide... and always can switch to the low fixed rates prior to closing. I can be reached by phone / text 403-479-0066 or [email protected]

[killramos]

BOC has another 50pt cut this afternoon.

[pheoxs]

This quote is hidden because you are ignoring this member. Show Quote

BOC has another 50pt cut this afternoon.

Crazy, adding more fuel to the housing market fire to try and keep it going.
@tim are bond markets also trending down? Do you think we'll see any cuts below on the fixed rates or has the market already priced things in?

[killramos]

I have gotten 4 times the normal number of viewing requests for my house this week lol. Nuts.

[blownz]

This quote is hidden because you are ignoring this member. Show Quote

I have gotten 4 times the normal number of viewing requests for my house this week lol. Nuts.

Hide your toilet paper!


And disinfect after they leave...

[TimLacroix]

This quote is hidden because you are ignoring this member. Show Quote

Crazy, adding more fuel to the housing market fire to try and keep it going.
@tim are bond markets also trending down? Do you think we'll see any cuts below on the fixed rates or has the market already priced things in?

No, the bond markets are trending upwards with the recent announcement.

Up from mid 0.50% to 0.65% now... 5 Year Bond Yield

And with that said, we just received notice from 1 major lender that they are raising rates tomorrow. Very odd... however, I was seeing changes to variable rate discounts that the last 2 days but not on any other rates.

More to come by Monday I assume.

[killramos]

This quote is hidden because you are ignoring this member. Show Quote

Hide your toilet paper!


And disinfect after they leave...

I’ll let my tenants know

[TimLacroix]

Rates have started to move... Friday evening Scotia made a big move!
- Scotia increase to fixed rates by 0.25%
- Scotia decrease in variable rate discounts from -0.70% to -0.10%

- Equitable Bank decrease in variable rate discounts from -1.00% to -0.25%

And a few other went from -1.00 to -0.80%.
And a couple other non-banks increase fixed by 0.10%

I would image we will see more announcements on Monday. If you are interested in securing some rates for the next 120-days... please PM me as I am working over the weekend to assist my fellow Beyond members. Or email [email protected].
-

[03ozwhip]

Hopefully some good news coming my way @TimLacroix !