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  #1411  
Old 2020-08-14, 11:09 AM
MortgageGuy MortgageGuy is offline
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Join Date: Jul 2008
Location: Ottawa, Ontario
Posts: 1,087
Default Stress test rate and weekend rates ;)

So bank of Canada has reset (reduced) the qualifying Stress test rate as of yesterday. Now sitting at 4.79%.
Every little bit helps!
https://www.cbc.ca/news/business/mor...test-1.5684685
The article is an interesting read with some history on the Stress test rate.
Slight drops in rates on some terms.
Pre-approvals being done at 5 yr fixed 2.19%
Best 5 yr fixed rate is 1.99% for an insured purchase.
2.04% for a 65% advance.
2.19% for a 80% advance mortgage.
For complete list of rates and terms go to
https://mortgagemoney.ca/best-mortgage-rates/
Have a great weekend,
Dan
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Dan Faubert
Ottawa-Carleton Mortgage Inc.
Brokerage Licence # 10419
dan@mortgagemoney.ca
www.mortgagemoney.ca
https://www.fb.com/OttawaMortgageMoney
"Great Mortgage Rates"

613-222-2624 anytime
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  #1412  
Old 2020-08-19, 10:27 AM
Perdition Perdition is offline
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Join Date: Aug 2020
Location: Kemptville
Posts: 2
Default 20%?

Hi Dan,

First time home buyer here. I have a question regarding down payments? My wife and I have saved up 20% of our home cost (it is a new build being ready for August of next year),

We went to TD and got approved and they told us they could not lock a rate in this early. Which we were perfectly fine with, however after doing some research it seems that borrowers who give less than 20% seem to get a lower rate than people who give 20%? Is there a reason for this?

Would you recommend trying to save more or giving less of a down payment? The home we are buying is 389,900 with about 5k in upgrades for a total of 394,900

Sorry if this is an obvious answer. First time home buying is so confusing!
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  #1413  
Old 2020-09-28, 11:53 AM
MortgageGuy MortgageGuy is offline
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Join Date: Jul 2008
Location: Ottawa, Ontario
Posts: 1,087
Default rate update Sept 28th

Realize it has been a long time since posting, I call it Covid time as it just seems like the year is flying by! Sorry about the long delay in answering..
So to first Perditions question...
When anyone purchases with less that 20% down payment, the borrower has to pay an insurance premium through Canada Mortgage and Housing(CMHC, the insurer). On a $500K purchase with 5% down payment, the insurance premium added to the mortgage would be $19,000.. ya I know YIKES...
that insurance premium guarantees the lender(bank) lending the money, that if the borrower defaults on the mortgage, CMHC will pay the bank back any loss they incur in disposing of the property after taking it from the borrower.
So in the banks eyes, a guarantee of never losing a penny on the mortgage, thus they offer a better rate than to someone who has more than 20% down payment. Because with 20% down or more, the bank doesn't have that guarantee, and could be exposed to a loss if the borrower defaults on the mortgage.
AND NO, it is never worth putting in less than 20% down(when you have more than 20% available) just to get the better rate.

2ndly, NO I would also never wait till I saved the 20% down payment before purchasing if you foresee not being able to have twenty % down for a long time...

Generally speaking MOST borrowers 1st time around never have the 20% down payment, thus the reason CMHC years ago..... came up with the insured program allowing a purchase with less than 20% down to buy a home.

Best rates available today that I know of are...

Best 5 yr fixed rate is 1.75% for an insured purchase.
1.89% for a 65% advance.
2.04% for a 80% advance purchase mortgage.
For complete list of rates and terms go to
https://mortgagemoney.ca/best-mortgage-rates/
As always, rate isn't everything, Collateral mortgages, restrictive sales clauses... be SURE of what you are signing up for with ANY mortgage you take.
Have a great week,
Dan
__________________
Dan Faubert
Ottawa-Carleton Mortgage Inc.
Brokerage Licence # 10419
dan@mortgagemoney.ca
www.mortgagemoney.ca
https://www.fb.com/OttawaMortgageMoney
"Great Mortgage Rates"

613-222-2624 anytime
Off 613-563-5070
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  #1414  
Old 2020-10-28, 03:52 PM
MortgageGuy MortgageGuy is offline
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Join Date: Jul 2008
Location: Ottawa, Ontario
Posts: 1,087
Default POct 28th Mortgage rate update...

Slight drop in insured pre-approval and purchase rates this week.
Still at all time lows, the 5 yr fixed rate for an insured purchase(less than 20% down payment) is at 1.60% (90 day closing)
1.69% for 120 days

Pre-approvals being done at 5 yr fixed 1.99%
Best 5 yr fixed rate with more than 20% down payment…
1.84% for a 65% advance.
1.89% for a 80% advance mortgage.
Best other insured rates…120 day closings
1 yr 1.74%
3 yr 1.74%
Variable 1.75% (Prime -.70)
For complete list of rates and terms go to
https://mortgagemoney.ca/best-mortgage-rates/

Deferred Mortgage Update…
RBC analysts have advised that approx. 11% of Canadian Bank mortgages are under a payment deferral program, and that up to 1 in 5 mortgages are likely to go into default. If 20% of mortgages under deferral eventually become delinquent in Canada, this equates to a mortgage delinquency rate of 2.3% which is almost 4 times higher than the peak Canadian mortgage delinquency rate over the past 30 years.” Fortunately, the banking sector appears sufficiently prepared for this eventuality, the RBC analysts said.

House prices are still crazy, just saw a purchase of an existing condo town house listed at $369,000 that sold for $463,000. Where does it end???

Anyhow hope everyone is well and having a great week,
Dan
__________________
Dan Faubert
Ottawa-Carleton Mortgage Inc.
Brokerage Licence # 10419
dan@mortgagemoney.ca
www.mortgagemoney.ca
https://www.fb.com/OttawaMortgageMoney
"Great Mortgage Rates"

613-222-2624 anytime
Off 613-563-5070
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  #1415  
Old 2020-11-17, 02:15 PM
MortgageGuy MortgageGuy is offline
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Join Date: Jul 2008
Location: Ottawa, Ontario
Posts: 1,087
Default Nov 17th Mortgage rate update :)

Only change in rates this week is a big one for the 5 yr Variable rate, now reduced to PRIME-1.10 or 1.39% today.(has to be an insured purchase, with a 90 day closing)
Lowest I have ever seen it. Still a gamble though, and an individual choice for variable(chance of changing 10 times a year with the Bank of Canada Rate), as opposed to guaranteed rate and payment on a fixed rate mortgage for up to 10 years, when we are sitting at historical low rates. Food for thought and fights between spouses!
Otherwise rates still at all time lows, the 5 yr fixed rate for an insured purchase(less than 20% down payment) is at 1.60%
90 day closings only, 1.64% for 120 days

Pre-approvals being done at 5 yr fixed 1.99%
Best 5 yr fixed rate with more than 20% down payment…
1.84% for a 65% advance.
1.89% for a 80% advance mortgage.
Best other insured rates…120 day closings
1 yr 1.74%
3 yr 1.74%
Variable 1.39% (Prime - 1.10)
For complete list of rates and terms go to
https://mortgagemoney.ca/best-mortgage-rates/
__________________
Dan Faubert
Ottawa-Carleton Mortgage Inc.
Brokerage Licence # 10419
dan@mortgagemoney.ca
www.mortgagemoney.ca
https://www.fb.com/OttawaMortgageMoney
"Great Mortgage Rates"

613-222-2624 anytime
Off 613-563-5070
Reply With Quote
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