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Steps to Renew your Mortgage

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Mortgage Refinance

Steps to Renew your Mortgage.

Renew your Mortgage

Renewal Statement:

The renewal statement is issued by your financial institution at least 21 days before the end of existing term. Information on the statement includes,Balance outstanding, Interest Rate, Payment Frequency, Term and any charges or fees that may apply. It specifies that until the date of renewal the interest rate offered will not increase. If the lender doesn’t wish to renew, you will be notified at least 21 days before the renewal date.  

Review your mortgage needs:

Two options at renewal are either to renew your mortgage or pay it off. This would be the a good time to review your needs.  

Points to consider:

  • Does your budget allow you to increase mortgage payments.
  • Do you want to pay off mortgage sooner and save interest by making additional prepayments.
  • Is there a need to change payment frequency. Biweekly accelerated payments can help you pay mortgage quickly.
  • Are you satisfied with your current lender.
  • Is there a need to consolidate the debts with higher interest rates. Does it make sense to increase mortgage payment.
  • Are you satisfied with the insurances in place like critical illness, disability, employment or mortgage balance protection.  

Find a Mortgage Broker:  

You don’t have to renew with the same lender. You can choose to renew with another lender that offers you terms and conditions that best suit your needs. No need to wait until you receive renewal letter. Contact your mortgage broker for advise and suitable mortgage.   If you do not take timely action, chances are your mortgage may automatically get renewed for another term. You may not get the best rate and conditions.   Keep in mind while switching to another lender for the same amount, the new lender will qualify you for mortgage. New lender may have a different criteria for mortgage approval. Talk to an expert who is well aware of lenders. You may have to pass stress test. There are alternate lenders that are more relaxed and offer competitive rates.   If you do not have mortgage default insurance the lenders use higher interest rate of Bank of Canada’s bench mark rate or contract rate plus two percent to qualify you. if the mortgage is renewed with existing lender, the lender is not required to use stress test, although may choose to do so.  

Costs to change Lenders:

  • Fees for discharge previous mortgage.
  • Fees for registering new mortgage.
  • Transfer or assignment fee in case of switch
  • Appraisal fee.
  • Legal fees.
  • Mortgage insurance fee applicable(If the amount of loan is increased, or taking extended amortization). Some lenders may absorb a portion of the fees.  Always advise your broker if you have taken insurance to avoid paying insurance twice.  

Collateral charge:

What if your existing mortgage is registered with collateral charge. You will have to pay fees to remove the charge and register the new mortgage with new lender. To remove the charge full amount must be paid to the lender for the collateral such as line of credit.   If you change lender before the end of the term you may also incur prepayment penalties. Consult with Mortgage Broker and know your options before taking any action.

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How to Payoff Mortgage Faster

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Imagine a life with no mortgage. How satisfying it would be knowing that your home is truly your’s. So much cash in hand and much more savings when there is no financial obligation such as the mortgage.

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Tips for Planning and Managing Your Mortgage

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Planning and Managing your Mortgages

Home financing may bring challenges. Be prepared to deal with as they come up. These can include a loss of income, increased expenses or rising interest rates. The following tips can ensure you’re financially stable through any ups and downs.

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How to get a Mortgage?

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How to Get a mortgage in Toronto?

You should have downpayment ready, Plan a budget. Check your credit if established. Support your application with required documents. We are Reliable, Trustworthy and dependable.

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CMHC new changes to Mortgage Insurance

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CMHC announced changes to its mortgage insurance underwriting and acceptance criteria.

Effective July 1, the following changes will apply for new applications for high ratio mortgages.

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Get your Mortgage Today with Low Interest Rates!

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New Lower Mortgage Rates are available!

What are you waiting for? Take advantage of the low interest rates.

NEW MORTGAGES RATES!

Let us help you with the Mortgage Solution. Give us a call today at 905-461-9177!

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Why use a Mississauga Mortgage Broker?

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Finser Mortgages-Why use a mortgage broker

– We Represent you! 

Our Mortgage Agent is inclined with your interests.

-Range of Mortgage Products!

We have mortgage products that suit your specific needs, and probably not available at your traditional lender.

-Options and Features!

You should have options and features that benefit you in the long run. Be able to pay faster or have pre payment privileges.

-Professional, Experienced, Trusted!

Finser Mortgages has been in the business for almost 20 years! We know Mortgages and our mississauga mortgage brokers and agents are here to help you get the mortgage that fits your need and specific situation. 

Finser Mortgages should be your number one choice when is comes to reasoning of why should you use a mortgage broker. Give us a call today at 905-461-9177!

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Bank of Canada Interest Rate Announcement

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bank of canada interest rate announcement

Bank of Canada cuts rate by half point.

First cut in four years lower key interest rate to 1.25%.

The Bank of Canada today lowered its target for the overnight rate by 50 basis points to 1 ¼ percent. The Bank Rate is correspondingly 1 ½ percent and the deposit rate is 1 percent.

While Canada’s economy has been operating close to potential with inflation on target, the COVID-19 virus is a material negative shock to the Canadian and global outlooks, and monetary and fiscal authorities are responding.

Before the outbreak, the global economy was showing signs of stabilizing, as the Bank had projected in its January Monetary Policy Report (MPR). However, COVID-19 represents a significant health threat to people in a growing number of countries. In consequence, business activity in some regions has fallen sharply and supply chains have been disrupted. This has pulled down commodity prices and the Canadian dollar has depreciated. Global markets are reacting to the spread of the virus by repricing risk across a broad set of assets, making financial conditions less accommodative. It is likely that as the virus spreads, business and consumer confidence will deteriorate, further depressing activity.

In Canada, GDP growth slowed to 0.3 percent during the fourth quarter of 2019, in line with the Bank’s forecast, although its composition was different. Consumption was stronger than expected, supported by healthy labour income growth. Residential investment continued to grow, albeit at a more moderate pace than earlier in the year. Meanwhile, both business investment and exports weakened.

It is becoming clear that the first quarter of 2020 will be weaker than the Bank had expected. The drop in Canada’s terms of trade, if sustained, will weigh on income growth. Meanwhile, business investment does not appear to be recovering as was expected following positive trade policy developments. In addition, rail line blockades, strikes by Ontario teachers, and winter storms in some regions are dampening economic activity in the first quarter.

CPI inflation in January was stronger than expected, due to temporary factors. Core measures of inflation all remain around 2 percent, consistent with an economy that has been operating close to potential.

In light of all these developments, the outlook is clearly weaker now than it was in January. As the situation evolves, Governing Council stands ready to adjust monetary policy further if required to support economic growth and keep inflation on target. While markets continue to function well, the Bank will continue to ensure that the Canadian financial system has sufficient liquidity.

The Bank continues to closely monitor economic and financial conditions, in coordination with other G7 central banks and fiscal authorities.

Source: https://www.bankofcanada.ca/2020/03/fad-press-release-2020-03-04/

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Mortgage Stress Test Changes Coming April 06-2020

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Starting in April, the government will change the rules that cover mortgage lending in a way that should, in the short term at least, make it easier to qualify for a loan to buy a home.

The Department of Finance says that as of April 6, the so-called “stress test” for mortgages will be calculated in a new way.

The stress test was implemented in January 2018 as a way to let some of the speculation out of the housing market at the time. It does so by making sure borrowers will be able to pay down their debts even if rates move higher. A would-be borrower is tested against his or her ability to pay down the loan at a higher interest rate, and if the borrower fails the test, a lender isn’t allowed to loan them money.

The rules had the effect of cooling the market, especially for first time buyers, which brought down prices in many markets because it shrank the pool of buyers.

ANALYSISAssessing whether 2020 will bring a Canadian property tumble: Don Pittis

At the time it was brought in, the benchmark was set at whatever the five-year posted rate at Canada’s big banks is, which is currently at 5.19 per cent. But under new rules announced on Tuesday and set to be implemented in April, the new bar will be “the weekly median five-year fixed insured mortgage rate from mortgage insurance applications, plus two per cent.”

“This will ensure that people only take on mortgages that are appropriate for the situation, but it does mean the changes in the stress test will be there if the average … rates provided by the banks actually goes down or up,” Finance Minister Bill Morneau said of the changes. “It will actually adjust appropriately to dynamic market conditions.”

The change tinkers with one of the major criticisms of the stress test in the first place, which was that the bar was set arbitrarily high. And non-bank lenders don’t like that the stress test rules give the big banks even more control over the market than they already had. Sherry Cooper, chief economist at Dominion Lending Centres, says the banks would always drag their feet in changing their posted rates, no matter what was happening in the market, “because it’s the rate they use in calculating the penalty for breaking a mortgage,” she said in an interview Tuesday. “This takes the big banks out of it.”

Source: https://www.cbc.ca/news/business/mortgage-stress-test-1.5467330

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Are Toronto House Prices Headed Back to 2016 Levels?

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Are Toronto House Prices Headed Back to 2016 Levels? Concern is growing that Canada’s largest housing market may be about to experience a new round of froth, similar to that seen in 2016.

Back then, red-hot housing markets in the Greater Vancouver and Toronto Areas ultimately forced the federal government to introduce the 2016 and 2018 mortgage stress tests on both insured and uninsured mortgages.

While sales activity and prices took a hit in both markets, the recovery for the Greater Toronto Area seems to be nearly complete. The Toronto Real Estate Board (TREB) reported in January that the MLS Composite Benchmark price was up 8.7% compared to January 2018—the fastest pace of growth since October 2017.

Source: https://www.canadianmortgagetrends.com/2020/02/toronto-house-prices-headed-back-2016-levels/

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