Variable mortgage regret?

[Buster]

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No recourse still exists in Alberta for uninsurable loans… but yeah not a major part of the Canadian lending portfolio… will be interesting if Ontario actually causes some pain to CMHC for once. Real steep decline in appraised values over the last few months out that way. But it shot up so fast the only pain so far is to buyers in the past year or so

The dumb and greedy you mean.

[suntan]

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No recourse still exists in Alberta for uninsurable loans… but yeah not a major part of the Canadian lending portfolio… will be interesting if Ontario actually causes some pain to CMHC for once. Real steep decline in appraised values over the last few months out that way. But it shot up so fast the only pain so far is to buyers in the past year or so

I thought you could still walk away from the loan but now it affects your credit rating?

[ercchry]

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I thought you could still walk away from the loan but now it affects your credit rating?

Not sure how the credit use to work, I would think any jingle mail would still end in an M9

No recourse isn’t really related… it is having the lender’s security ends at the property, that’s not the case for most people now, between the lender being able to recover any losses from other assets, and as well as the insurer (the loss is now split between the two). They basically won’t lose… well, till the whole thing topples (blood from a stone and all that)

[Misterman]

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The dumb and greedy you mean.

I'm not sure I'd classify people wanting to get in before they physically cannot afford something as greedy. Dumb yes, but not greedy.

[suntan]

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Not sure how the credit use to work, I would think any jingle mail would still end in an M9

No recourse isn’t really related… it is having the lender’s security ends at the property, that’s not the case for most people now, between the lender being able to recover any losses from other assets, and as well as the insurer (the loss is now split between the two). They basically won’t lose… well, till the whole thing topples (blood from a stone and all that)

Apparently in the good ol' days you could walk away in 'berta and the lender could not affect your credit rating.

[ercchry]

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Apparently in the good ol' days you could walk away in 'berta and the lender could not affect your credit rating.

It’s also possible they just never reported to begin with, still lenders today that don’t. I would imagine that would have been a rather manual process back then… but I’m not old enough to know!

[hurrdurr]

Wish I would have locked in last year. Paying $660 more per month now since last year all to interest.

[Rarasaurus]

High Immigration and High rates will push Rental costs up. It is nice that energy is coming down now along with Inflation but these rate hikes will also fuel inflation.

[suntan]

Rental demand is up because people can't afford homes anymore.

Monetary inflation is simply a measure of the demand for money in relation to its supply.

You have to raise rates high enough for long enough that they lower inflation to a nominal rate.

Mmm, good times.

[Xtrema]

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I'm not sure I'd classify people wanting to get in before they physically cannot afford something as greedy. Dumb yes, but not greedy.

You need to look at it thru the lens of GTA and GVA. Tons of people on salary is trying to play the flip game with 2nd and 3rd mortgage who are now upside down. Those are dumb and greedy.

[Buster]

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I'm not sure I'd classify people wanting to get in before they physically cannot afford something as greedy. Dumb yes, but not greedy.

They expected to catch the wave up, and got FOMO.

that's pure greed.

[suntan]

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You need to look at it thru the lens of GTA and GVA. Tons of people on salary is trying to play the flip game with 2nd and 3rd mortgage who are now upside down. Those are dumb and greedy.

As long as they keep their main job they'll suffer but be okay eventually.

[max_boost]

It’s just money. It’s all good man.

[Kloubek]

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It’s just money. It’s all good man.

Something my mother taught me as a child when I was wailing about something bad happening:

"Will this affect your life in 5 years?" A few grand - probably not significantly, no.

If this carries on for years, I could see a lot of people have it affect them at increasingly different levels.

[suntan]

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Something my mother taught me as a child when I was wailing about something bad happening:

"Will this affect your life in 5 years?" A few grand - probably not significantly, no.

If this carries on for years, I could see a lot of people have it affect them at increasingly different levels.

Sub 1% prime is gone forever. You will never see it again in your lifetime.

Fuck you might never see 2% again.

[killramos]

Yea that’s true. Right up until you do.

[Misterman]

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Sub 1% prime is gone forever. You will never see it again in your lifetime.

Fuck you might never see 2% again.

Or more than likely this will be just another boom bust cycle we go through, rinse and repeat again in 10 years.

[max_boost]

yup. we old man. most of us have been through this lol

[Kloubek]

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Sub 1% prime is gone forever. You will never see it again in your lifetime.

Fuck you might never see 2% again.

I don't think we can say "never". I'm guessing back in the early 80's when it was upwards of 20% they said something along the lines of "You'll never see a 2% interest rate in your lifetime". Yet, we all know what happened. Granted, that was 40 years ago... still inside a lifetime.

The market ebbs and flows, but sub 1% is certainly not the norm. I think a lot of people got lulled into a false sense of ability towards home ownership, without realizing that historically, they're probably looking at an average of around 8-9% prime during the course of the mortgage. For those of us on the tail end of their mortgage, it doesn't hurt as much. But I imagine for those who are currently house poor, there's some sweating going on...

[suntan]

The difference this time 'round is that money was given directly to the citizens. That stunt hasn't been tried in decades in non-banana republics, mostly because all it does is cause monetary devaluation rather than actually make the idiot masses richer.

Contrast this with QE, where the central back gives bond holders their money back or they're simply forced to accept lower yielding bonds to replace their current bonds. This keeps banks and other lenders as the gate keepers of that sweet, sweet central bank money.