BlogCatalog

Underwriting delays are widespread!

 

 

 

 

 

 

 

 

With so many people rushing to lock in fixed rates, many lenders are seeing record volumes.  As a result, underwriting delays are widespread.  

In many cases, application turnaround times are five or more business days.  Reports of certain low-rate lenders with two week backlogs in their queues. Also with many Realtors in Alberta insisting that their buyers are Pre-Approved it is creating a log jam for lenders. If you have all of the required documentation it is much easier for the lender to issue a quick pre-quilification certificate.

 

Remember that all high ratio deals are subject to CMHC and Genworth approval regardless of your pre-approval. It is important to note that CMHC and Genworth do not do Pre-Approvals and only work on live files.  

Normal approval times vary, but have traditionally been 1-2 days, sometimes even same-day. 

Application Tips:

• If you are purchasing a property and need to lift conditions quickly, make sure to keep the above in mind. Service levels are high so plan ahead 
• If you want a highly competitive rate, ask the property vendor for five days minimum to arrange financing.  (Consulting a mortgage planner beforehand will help you gauge the required approval time.) Often you will be able to submit a rate hold for 120 days without an application
• If you need a pre-approval, be prepared to wait 5+ business days in many cases.
• Have your documentation (job letter, pay stubs, etc.) on hand to minimize approval time.
• If you are just looking for a rate hold, often a name and number can secure your rate for up to 120 days 

On the plus side, once your application is submitted to a lender, that lender will guarantee you get that day’s rate if you are approved.  This generally applies regardless of how long it takes for the lender to issue an approval.

www.canadianmortgagetrends.com

TD Canada Trust Raises Fixed Rates!

With the leap in bond yields yesterday, a bunch of lenders are once again raising fixed mortgage rates.

TD was the first of the Big 5 today to announce a rate increase.  Canada’s second largest bank is hiking rates as follows:

• 5-year posted fixed rate:  5.85%, up 0.40%
• 4-year posted fixed rate:  5.14%, up 0.30%
• 3-year posted fixed rate:  4.65%, up 0.50%

That 5-year move is the biggest increase in almost a year.

TD also announced it is lowering its 1-year rate by 0.15%.

If history is a guide, the other large banks will likely announce their own increases in the next 24 hours.

Assuming the banks all move their 5-year posted rates to 5.85%, that will amount to a 0.60% increase in the last nine days.  On a $200,000 5-year mortgage with 25-year amortization, that equates to over $5,700 more interest over five years.

If there’s one bright side, it’s that IRD penalties will potentially fall for certain people who are breaking their fixed-rate mortgages early.

If  you still have not saved your rates contact me TODAY for a 120 day rate hold, offer ends june 10th at 11:00pm eastern time

Bond Rates Rise! Fixed Rates to Jump

Bond Yields Jump Again The 5-year government bond rocketed to 2.71% today. Various lenders have already issued fresh new fixed rate increases. More may follow tomorrow if yields don’t retrace.

Two-year bond yields also broke to the upside. That may lead to upcoming rate increases on shorter-term mortgages, which have been insulated from rate hikes for several months.

 

If you’re shopping for a fixed mortgage, be safe and get your application in soon.

TD Canada Trust Increases 5,6,7 and 10 year rates

Just announced!!

TD Canada Trust is increasing the 5,6,7 and 10 year Fixed mortgage rates and has also changed the rate for the 10 year special offer to 5.45%, these rates are effective midnight June 3rd, 2009 EST

This may be the time to lock in, what is your current rate?

TD Canada Trust Lowers Closed VIRM Rates

We are pleased to advise the Closed VIRM Discretion Pricing has decreased to .60%, with a new rate offer of 2.85% effective May 27th, 2009. The 10 Year Special Offer at 5.25% has been extended, please review the below for details.

Vancouver for under $1,000 per month!!

THOMASINA BARNES

From Friday’s Globe and Mail

March 13, 2009 at 11:09 AM EDT

• 8988 HUDSON ST., UNIT 306
• ASKING PRICE: $239,900
• SELLING PRICE: $234,000
• PREVIOUS SELLING PRICE: $158,900 (2004)
• TAXES: $958 (2008)
• DAYS ON MARKET: five
• LISTING AGENT: Keith Roy, Macdonald Realty

Low interest rates mean low mortgage payments, a combination that is bringing buyers back to the market, agent Keith Roy says.

“Most people don’t care about the price of the home as much as they care about the monthly payment for owning the home,” he says.

“With interest rates at historic lows and prices down year over year, first-time buyers and renters are returning to the market.”

Enlarge Image

The suite sold to a first-time buyer after the first open house.

While the unit is small, the new owners were “attracted by the modern design and steel construction” of the five-year-old building, Mr. Roy says.

The bachelor suite also has reclaimed fir floors, a gas fireplace and stainless steel appliances. “Even though it is only 470 square feet, this unit is well laid out and has a separate area for the bed, a walk-in closet and large soaking tub,” he says.

The loft-style apartment also has 10-foot ceilings, granite countertops and a balcony for barbecues.

Other amenities include ensuite laundry, an underground parking stall, a three- by six-foot storage locker and communal bike room.

A $136 monthly maintenance fee covers garbage pickup, gardening, hot water and the maintenance and use of an in-house fitness centre.

“You should not be fooled by size,” Mr. Roy says. “The new owners of this suite found true value and will pay less than $1,000 a month to own this home.”

TD Canada Trust Lowers Mortgage Rates

Changes in Residential mortgage rates!

SUMMARY

Effective April 22, 2009, our Mortgage rates have changed as indicated below.

Term	Rate		Change
6-month convertible	4.90		N/A
1-year open	7.15		N/A
1-year closed	4.20		N/A
2-year closed	4.70		N/A
3-year closed	4.90		N/A
4-year closed	5.14		N/A
5-year closed	5.45		N/A
6-year closed	6.30		N/A
7-year closed	6.70		N/A
10-year closed	6.70		N/A
1-year closed Special	3.20		N/A
4-year closed Special	4.09		N/A
5-year closed Special	4.15		N/A
10-year closed Special (*2)	5.25		N/A
Variable Interest Rate Mortgages	TD Mortgage Prime	Variance	Rate
Closed VIRM: Rate is TD Mortgage Prime + 0.80%	2.50	+0.80	3.30
Open VIRM: Rate is TD Mortgage Prime + 1.00%	2.50	+1.00	3.50
Home Equity Line of Credit	TD Prime	Variance	Rate
Float: Spring Money-Out Limited Time Offer: Rate is TD Prime + 1.00%(*1)	2.25	+1.00	3.25

Notes:

• (*1) TD Prime + 1.00% is a “Spring Money-Out” Limited Time Special, which is valid on fundings through June 30, 2009
• (*2) Special is valid on new mortgage applications received by May 31, 2009 and mortgage must be advanced by July 31, 2009. Offer may be changed, extended or withdrawn at any time without notice. Mortgage renewals must be signed and submitted to TD Canada Trust by May 31, 2009.

 

Announced today – TD Canada Trust pricing structure on the 4-5 year fixed term products.

Effective April 7, 2009, our Mortgage rates have changed as indicated below.

Term	Rate	Change
6-month convertible	4.90	-0.30
1-year open	7.15	-0.30
1-year closed	4.20	-0.30
2-year closed	4.70	-0.30
3-year closed	4.90	-0.30
4-year closed	5.14	-0.30
5-year closed	5.45	-0.10
6-year closed	6.30	-0.10
7-year closed	6.70	-0.10
10-year closed	6.70	-0.10
1-year closed Special	3.20	-0.30
4-year closed Special	4.09	-0.30
5-year closed Special	4.15	-0.10
10-year closed Special (*2)	5.25	N/A
Variable Interest Rate Mortgages	TD Mortgage Prime		Variance	Rate
Closed VIRM: Rate is TD Mortgage Prime + 0.80%	2.50		+0.80	3.30
Open VIRM: Rate is TD Mortgage Prime + 1.00%	2.50		+1.00	3.50
Home Equity Line of Credit	TD Prime		Variance	Rate
Float: Spring Money-Out Limited Time Offer: Rate is TD Prime + 1.00%(*1)	2.50		+1.00	3.50

Notes:

• (*1) TD Prime + 1.00% is a “Spring Money-Out” Limited Time Special, which is valid on funding through June 30, 2009
• (*2) Special is valid on new mortgage applications received by May 31, 2009 and mortgage must be advanced by July 31, 2009. Offer may be changed, extended or withdrawn at any time without notice. Mortgage renewals must be signed and submitted to TD Canada Trust by May 31, 2009.

The Right Time of Year to Sell

Many people who wish to sell their home have to face the question of when is the right time of the year to do so. The truth is that there is no clear answer to this question because the answer depends on too many factors and all of them are of a subjective nature. People who are looking to buy a home do so based on many factors. Are they being relocated due to a job transfer? Have they been waiting for their home to sell? The only clear trend is that during spring and summer the number of homes sold is higher.

There are, however, other factors to consider. Do you want to sell in a busy market or a slow market? A busy market means there will be a lot more competition. If you feel that your home may not position well to stand heavy competition then it would be better to wait till the market slows down a bit. If, on the other hand, you position your home so that it is competitive in the market then time of year is less of a consideration.
Learn how your property value is calculated

While seasonal trends are important it is not the most important thing. The most compelling factor in selling a home are your own needs. There has to be a reason why you are selling your home and there is probably a deadline by which you have to have done so. Focus on those rather than on the time of the year. Also pay attention to current market conditions. You may not be able to wait for early spring for the market to get busy, so do not damage your position by waiting for months.

Is your home ready? See these selling tips

Apart from current market conditions you should also understand where the market is going. This involves a bit of research to figure out future trends from past ones. Though you cannot accurately predict the future of the market you can get a reasonably close picture. Give me a call and I can help you make a well-informed decision. If the market is beginning to slow down and turn into a buyer’s market then obviously you are better off the sooner you sell your home. Waiting in a slowing market will only lower the market value of your home. If your home is in an area of rising property values, price your home to reflect the direction of the market. Again, I can give you advice and guidance.

Also, if you’re considering to sell your home, but don’t think you can buy another one until your present home is sold, there can be a solution. Sometimes a bridge loan can be the answer to buying another home while you’re selling the present one.
Here’s a Quick Guide to Bridge Loans.

There are many factors to consider when selling your home. The time of year is less important than making sure your home is priced correctly and marketed properly. Remember that you only need one buyer!

What is IRD?

What is IRD and how can I reduce this??

 

What Does Interest Rate Differential – IRD Mean?
A differential measuring the gap in interest rates between two similar interest-bearing assets. Traders in the foreign exchange market use interest rate differentials (IRD) when pricing forward exchange rates. Based on the interest rate parity, a trader can create an expectation of the future exchange rate between two currencies and set the premium (or discount) on the current market exchange rate futures contracts.

 

 

Investopedia explains Interest Rate Differential – IRD
The IRD is a key component of the carry trade. For example, say an investor borrows US$1,000 and converts the funds into British pounds, allowing the investor to purchase a British bond. If the purchased bond yields 7% while the equivalent U.S. bond yields 3%, then the IRD equals 4% (7-3%). The IRD is the amount the investor can expect to profit using a carry trade. This profit is ensured only if the exchange rate between dollars and pounds remains constant.

 

WHAT DOES THIS MEAN FOR ME AND MY MORTGAGE?

This usually means the difference between the interest rate on your mortgage contract compared to the rate at which the lending institution can re-lend the money.

For example:

 

-If your mortgage has a balance of $125,000 at 9.25%,

you have 2 years left to go and the current 2 year mortgage rate is 6.25%.

 

-Then the lending institution will probably charge you -

$125,000 X 24 months X 3% (9.25 – 6.25) = $7,266.21

 

However, just to further confuse the issue, the penalty above has not been present valued. This is when a lender charges a lower penalty because you are paying all of the ‘extra’ interest (in the example 3%) now, not over the remaining term. Some lenders present value, other lenders do not.