Higher Down Payments for Home Buyers Tomorrow!

Abbotsford, Chilliwack and Mission: A stolen gift from the Federal Grinch or a measured stance against an over heated real estate market?

According to Richard Madan from CTV news, Abbotsford, Chilliwack and Mission mortgages will see the Federal Government change their minimum down payment in 2016.

Tomorrow on Friday December 11th 2015  they are announcing that minimum down payments are being increased depending on the house purchase price. This will ultimately require buyers to save up more money to buy a home.

The new regulation will be require buyers to put 10% down payment on any amount of purchase price beyond $500,000.00. See the comparison chart below.

The regulation are expected to take effect in 2016.

Buyer shopping for homes below $500,000.00 will not be affected.

Our finance minister Bill Morneau will announce tomorrow morning. These measures are taken to cool the heated Real Estate market locally and in Ontario.

Purchase Price Current Down Payment Addition Down Payment New Down Payment
$400,000.00 $20,000.00 $0.00 $20,000.00
$500,000.00 $25,000.00 $0.00 $25,000.00
$600,000.00 $30,000.00 $5,000.00 $35,000.00
$700,000.00 $35,000.00 $10,000.00 $45,000.00
$800,000.00 $40,000.00 $15,000.00 $55,000.00
$900,000.00 $45,000.00 $20,000.00 $65,000.00

SOURCE:http://www.ctvnews.ca/mobile/business/feds-to-tighten-mortgage-rules-for-homes-over-500k-1.2695989

Abbotsford, Chilliwack, Mission New Down Payment Rules

By Referral Mortgage Consultants*

“Click, Call, Chat – Award Winning Brokers”
 1 – 32540 Logan Ave
Mission BCV2V 6G3

&

360-3033 Immel St

AbbotsfordBCV2S 6S2

&

8387 Young Rd

ChilliwackBCV2P 4N8

Dave  604 897 2741 Jordi 604 615 1312
www.AbbotsfordsMortgageBroker.com

 

www.BRMC.ca

 

www.PeaceOfficeMortgageBroker.com

Connect with us on!
 BRMC Facebook

 

BRMC Google review Chilliwack Office

BRMC Google review Abbotsford Office

BRMC Google review Mission Office 

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http://www.youtube.com/user/BRMCmortgages

Credit checks for Abbotsford, Mission and Chilliwack mortgage clients recently frustrated

We highly recommend all our Abbotsford, Mission and Chilliwack mortgage clients sign up for a personal account with Equifax and TansUnion. These credit agencies will allow you to start receiving your credit report any time you need it and monitor for fraudulent credit checks. If membership is too expensive then at least pull your credit once per year. It will not only equip you with the info you need to avoid bad credit scores via inaccuracies but it also can curb fraud. Both agencies will send you a notification every time some pulls your credit with full membership.

There are also occasions when bankers, lender, car financiers and furniture/jewelry stores that you have previously shared your info with will pull your credit again without proper consent assuming their first consent gives them car-blanch freedom to act as they wish or thinks is best for you.

These credit checks with show up in your email and you will have leverage to launch a complaint against these actions. This will help you reverse these inquiries.

As a reputable lender we always get verbal OR written authorization to do credit checks and we think everyone should do the same. Remember a mistake on your credit bureau can take weeks if not months to fix and in that time you could miss out on a dream property or investment opportunity!

By Referral Mortgage Consultants*

“Click, Call, Chat – Award Winning Brokers”
 1 – 32540 Logan Ave
Mission BCV2V 6G3

&

360-3033 Immel St

AbbotsfordBCV2S 6S2

&

8387 Young Rd

ChilliwackBCV2P 4N8

Dave  604 897 2741 Jordi 604 615 1312
www.AbbotsfordsMortgageBroker.com

 

www.BRMC.ca

 

www.PeaceOfficeMortgageBroker.com

Connect with us on!
 BRMC Facebook

 

BRMC Google review Chilliwack Office

BRMC Google review Abbotsford Office

BRMC Google review Mission Office 

http://www.linkedin.com/company/2410358

https://twitter.com/brmcmortgages

http://www.youtube.com/user/BRMCmortgages

We’re active on Facebook, Twitter, LinkedIn & YouTube. We really appreciate reviews! Good or Bad please let the world hear your voice! Connect with us for ongoing industry news items, contests & prizes.

*By Referral Mortgage Consultants – doing business as BRMC is: Verico Preferred Financing Inc / Verico Canadian 1st Mortgage Corp which have a co-brokering agreement and there is a common Mortgage relationship and are licensed with the Verico Dreyer Group. Mortgage ownership, that employees of both Mortgage companies may review, advise and help process the Mortgage files. That Verico Preferred Financing Inc & Verico Canadian 1st Mortgage Corp share the some expense and income from mortgages. Kim Langille Featured on thess site is an unlicensed mortgage assistant only, not a Mortgage Consultant. Jordi Browne featured on this site is the Mortgage Broker of record. “The Broker” is Jordi Browne. Jordi Browne also holds a Life Insurance License and represents Verico Canadian 1st Mortgage Corp. Dave Browne featured on this site has a Life Insurance License too but is an independent agent– Jordi and Dave Browne co-broker life insurance files and share expenses, all income retained by Verico Canadian 1st Mortgage Corp. 

 

Mortgages not easy, but not impossible.

Today was our BRMC mortgage team weekly lunch. Galaxy Pho in Chilliwack was our destination today – Sooooo Gooood!

As we enjoyed our soups we discussed the challenges each of us are facing. We are seeing challenges on all different types of mortgage products and mortgage clients. The more we compared, the more we realized the Mortgage Market in Abbotsford, Chilliwack and Mission have changed over the last few months.

Technically the changes started 6 years ago when the mortgage insurance companies like CMHC began their slow and steady “de-risking” policy by amending their lending policies. In doing this they have hoped to create a more stable housing market in this low interest rate era. That being said, they have effectively left consumers with less choices and higher funding costs for lenders and borrowers. This article somewhat summarizes these insurance companies bottom line and why they made these changes, though it seems they are being ultra conservative based on their reserves according to this article..

Changes over last 6 years have included:

  • cutting back amortization maximums
  • reducing maximum LTVs (Loan To Value of the house)
  • Eliminated products
  • Applying conservative approach to Low Down Payment purchasers
  • Increased documentation for Self Employed mortgages
  • Fees for insurance increased

We as a group have seen a significant up-tick in turn downs for mortgages from the insurers in Canada. It is our belief that recent reports regarding the inability of low down payment purchasers to save money after receiving their mortgages have led the insurers to make tougher lending guidelines specifically aimed at them.

Business For Self clients are also receiving the same treatment regardless of down payment size. At one time borrowers such as these BFS clients could put 35% down payment and demonstrate an ability to save money to offset any concerns from the lenders & insurers but that is not the case anymore.

We were recently advised by an underwriter from a major lender that self employed “stated-income mortgages” will be a thing of the past and all clients will be expected to report higher incomes on their tax returns to qualify for mortgages. Demonstrating a strong cash position will simply not be enough.

In conclusion we can still lend you money, but be prepared for the lender to ask for a lot of documentation no matter who you are, strong credit, weak credit or indifferent.

By Referral Mortgage Consultants*

“Click, Call, Chat – Award Winning Brokers”
 1 – 32540 Logan Ave
Mission BCV2V 6G3

&

360-3033 Immel St

AbbotsfordBCV2S 6S2

&

8387 Young Rd

ChilliwackBCV2P 4N8

Dave  604 897 2741 Jordi 604 615 1312
www.AbbotsfordsMortgageBroker.com

 

www.BRMC.ca

 

www.PeaceOfficeMortgageBroker.com

Connect with us on!
 BRMC Facebook

 

BRMC Google review Chilliwack Office

BRMC Google review Abbotsford Office

BRMC Google review Mission Office 

http://www.linkedin.com/company/2410358

https://twitter.com/brmcmortgages

http://www.youtube.com/user/BRMCmortgages

We’re active on Facebook, Twitter, LinkedIn & YouTube. We really appreciate reviews! Good or Bad please let the world hear your voice! Connect with us for ongoing industry news items, contests & prizes.

*By Referral Mortgage Consultants – doing business as BRMC is: Verico Preferred Financing Inc / Verico Canadian 1st Mortgage Corp which have a co-brokering agreement and there is a common Mortgage relationship and are licensed with the Verico Dreyer Group. Mortgage ownership, that employees of both Mortgage companies may review, advise and help process the Mortgage files. That Verico Preferred Financing Inc & Verico Canadian 1st Mortgage Corp share the some expense and income from mortgages. Kim Langille Featured on thess site is an unlicensed mortgage assistant only, not a Mortgage Consultant. Jordi Browne featured on this site is the Mortgage Broker of record. “The Broker” is Jordi Browne. Jordi Browne also holds a Life Insurance License and represents Verico Canadian 1st Mortgage Corp. Dave Browne featured on this site has a Life Insurance License too but is an independent agent– Jordi and Dave Browne co-broker life insurance files and share expenses, all income retained by Verico Canadian 1st Mortgage Corp. 

 

4 Mortgage Predictions for 2016: Abbotsford & Chilliwack Mortgages Holders

Predictions are fun to read but tough to get right.  For example for the last 6 years I have heard predictions that rates will be going up “next year”.  Some of these predictions were made by men with more letters behind their name then myself.  I just goes to show that even the most educated have troubles getting it right.

With that being said I thought I would give it a try.  Here is a few I would like to prognosticate.
  • 1 – The Big Fix – The banks will not drop their prime rate in accordance with the recent 25bps discount they were given off the key lending rate from the government..
I see the banks keeping the prime rate at 3% but they will lower the discount they give off the prime rate (IE Prime – .70%= 2.30%).  I could see them lowering the discount they offer of prime from 10 – 20bps, which would enable them to pocket some of the savings.
This will do three things. First it will drive more new business into them as the perception will be that they will be doing a favor to the public but effectively they will not be passing the full 25bps discount they received from the government.
Second they will not have to pass on the 25bps discount to their current book of clients with mortgages based on prime which will increase their profit.
Third it will generate more income from pre-payment penalties as it will make s for current clients to break their term to take advantage of the further discount.
  • 2 – The spring rate war is coming again –  Just like the last few years BMO will advertise a low 5 year fixed which other banks will follow.  We will see a newspaper article stating that this is the lowest rate ever offered to the Canadian public for the yet another year in a row.
Even though this in the newspapers will be a good rate offered by BMO, it will not be the best rate in the market. For the best rate call a mortgage broker like myself.
  • 3 – Rules are a Changing – We have been told time and time again we have too much debt.  There is a perception out their in government that these low rates are not going to cause the general public to borrow too much money.  I see the government putting in further restrictions on mortgage products in Canada.
Its rare to hear from my clients that their mortgage is the cause of their financial pain.  It is the credit cards, lines of credits and auto loans they have obtained that they having problems keeping up with.
I think its time for the government to make it harder to obtain these facilities of credit just like they have done to the mortgage market.
  • 4 – Prediction of all Predictions! – By the end of the year you will hear from a so called expert that rates will be going up in 2016.  Eventually they will have to be right…just do not be so quick to believe them!
While all of these might not come true, it was fun to write a piece like this.  I hope you enjoy!

By Referral Mortgage Consultants*

“Click, Call, Chat – Award Winning Brokers”
 1 – 32540 Logan Ave
Mission BCV2V 6G3

&

360-3033 Immel St

AbbotsfordBCV2S 6S2

&

8387 Young Rd

ChilliwackBCV2P 4N8

Dave  604 897 2741 Jordi 604 615 1312
www.AbbotsfordsMortgageBroker.com

 

www.BRMC.ca

 

www.PeaceOfficeMortgageBroker.com

Connect with us on!
 BRMC Facebook

 

BRMC Google review Chilliwack Office

BRMC Google review Abbotsford Office

BRMC Google review Mission Office 

http://www.linkedin.com/company/2410358

https://twitter.com/brmcmortgages

http://www.youtube.com/user/BRMCmortgages

We’re active on Facebook, Twitter, LinkedIn & YouTube. We really appreciate reviews! Good or Bad please let the world hear your voice! Connect with us for ongoing industry news items, contests & prizes.

*By Referral Mortgage Consultants – doing business as BRMC is: Verico Preferred Financing Inc / Verico Canadian 1st Mortgage Corp which have a co-brokering agreement and there is a common Mortgage relationship and are licensed with the Verico Dreyer Group. Mortgage ownership, that employees of both Mortgage companies may review, advise and help process the Mortgage files. That Verico Preferred Financing Inc & Verico Canadian 1st Mortgage Corp share the some expense and income from mortgages. Kim Langille Featured on thess site is an unlicensed mortgage assistant only, not a Mortgage Consultant. Jordi Browne featured on this site is the Mortgage Broker of record. “The Broker” is Jordi Browne. Jordi Browne also holds a Life Insurance License and represents Verico Canadian 1st Mortgage Corp. Dave Browne featured on this site has a Life Insurance License too but is an independent agent– Jordi and Dave Browne co-broker life insurance files and share expenses, all income retained by Verico Canadian 1st Mortgage Corp.