News, Views and Trends!
Part 2 of 2…. In Part 1, we examined rental properties and how they can be a great way to reduce your taxes, build net worth and create an income stream. Part 2 looks at Interest payments. Interest payments are a big part of our personal expenses. Here are a few suggestions on how to reduce your interest costs.
Continue reading “Death, taxes and interest payments. Part 2 of 2.”
Death and taxes, the only two things that are certain in life. You’ve heard this one before. I think there is a third thing that can be just as stressful, ‘interest payments’ (before this article becomes too depressing, I’m going to share some things that will help to reduce our interest costs and minimize our taxes). Continue reading “Death, taxes and interest payments! Part 1 of 2.”
I wrote that back in 2006. Since then we have seen some provincial governments step in with laws to help protect unsuspecting homeowners. You can also purchase Title insurance or an alternative method of protection.
A couple of years ago, Toronto police said a woman used fake ID to get a $300,000 mortgage. The unsuspecting homeowner only discovered a mortgage had been fraudulently registered on their home when they received mortgage documents in the mail.
This is not a new scam. It’s happened many times in the past. Here’s a big one from 2010 that involved $140million and hundreds of people. This one was huge. Most are not this big or elaborate. It’s the smaller ones, like the recent one for $300,000, that are more common place.
HOW IT’S DONE
If I gave the option of choosing between two cell phones, which would you choose? Both phones had similar specs and were identical in almost every way… except PHONE one came in a nicely gift wrapped box with a bow on it. PHONE two came in a brown paper bag but was less expensive and also had slightly better options.
Most of us would choose PHONE two right? Wrong! When it comes to mortgages, most of us are focusing too much on the beautiful gift box and not paying enough attention to the contents. They say around 47% of all mortgages go through a BANK and 39% go through a Mortgage Broker. Broker share is up, but not enough in my opinion.
When it comes to mortgages, historically the BIG SIX BANKS have been charging higher rates than what can be had from MORTGAGE BROKERS. (see Bank of Canada study ‘competition in the Canadian mortgage market). And their inflated prepayment penalty calculations are now infamous (typical BIG SIX BANK penalties are around 4 times higher than other lenders).
Continue reading “Are you looking at the beautiful box or what’s inside?”
WAS THIS A BIG MISTAKE?
Last week, Stephen Poloz, the Bank of Canada Governor, kept the Prime Rate as is during the 6th of their eight scheduled meetings for 2019. The Current Target rate is 1.75%. (Bank Prime rate is derived from this rate. Today’s Bank Prime rate is 3.95%. Over 99% of time, when the Target Rate is cut, the Banks will reduce the Bank Prime Rate by an equal amount).
This was a very calculated decision that has politics written all over it. While the rest of the world banks have been cutting rates to combat a looming recession due to growing global trade wars and slowing global economies, our Government did nothing. Apparently, the Canadian economy is ‘resilient’. The next Bank of Canada meeting is set for October 30, 2019. Oh, and there’s a Federal election on Oct 21, 2019. Yeah, this has politics written all over it.
WHAT YOU SHOULD KNOW ABOUT MORTGAGE RATES TODAY. Continue reading “Why didn’t the Bank of Canada Gov cut rates last week?”
