CategoryMortgage News

Posted June 3, 20132 Comments Bank News

CMHC CEO Karen Kinsley out, Wall Street banker Robert Kelly in… anybody asking why??

Karen Kinsley has been with CMHC (Canada Mortgage and Housing Corporation) for 25 years. The last 10 as it’s CEO. CMHC makes buying a home more affordable by insuring the mortgage against default. End result is a lower down payment requirement and lower interest rates. CMHC is profitable. They earned $1.7 billion in 2012 and $17 billion over the last 10 years.

In 2012, the Federal govt and the Minister of Finance decided to move CMHC under OSFI (Office of the Superintendent of Financial Institutions). OSFI is a regulatory body that provides regulation and supervision to 152 Banks, Trust companies and other Lenders. They function like auditors. A move questioned by many and one that contradicts the spirit of what CMHC is supposed to stand for.

Enter Robert P. Kelly. Mr. Kelly was appointed as Chairperson of the Board of Directors of CMHC this same month. Coincidence? Here’s a bit of history on Kelly….He worked at TD Bank from 1981 to 2000 leaving as a senior executive that was on the short list to be TD’s CEO.. he didn’t get the job and left for the U.S. to join Wachovia, then later Bank of New York Mellon as CEO and Chairman. I remember Mr. Kelly from my days working at TD. He was always a higher profile, more visible executive… Continue reading “CMHC CEO Karen Kinsley out, Wall Street banker Robert Kelly in… anybody asking why??”

Posted May 31, 20135 Comments Mortgage News

Top Banking regulator stepping.. OSFI’s Julie Dickson leaving in 2014

Julie Dickson, the head of OSFI (Office of the Superintendent of Financial Institutions) will not be back when her term expires in July 2014. She’s decided to not to stick around after making more lending rule changes in 2012, than I have ever seen, during my entire 23 year career working in financial services. OSFI is a regulatory body that provides regulation and supervision to 152 Banks, Trust companies and other Lenders. In short, they are auditors. Here’s a link to the major changes made just last year including putting CMHC under OSFI control.. more on that later..

Some say her claim to fame is that she was in charge during the worst banking and mortgage crises in history. And that Canada came out of this global financial collapse way better than any other country. It’s true, we did come out of this very well compared with the rest of the world… But what does Ms. Dickson and OSFI have to do with it? For me, this had more to do with luck, govt intervention and Canadians being our normal conservative selves. We were a little slower to adapt to U.S. style lending policies… Ask any financial expert and they will tell you we were just a few years behind the U.S. with regards to their wild mortgage lending guidelines… Continue reading “Top Banking regulator stepping.. OSFI’s Julie Dickson leaving in 2014”

Posted May 28, 2013 Interest rates

5 yr Bond yields up significantly.. expect fixed rates to go up..!

5 yr Govt of Canada bond yields are up over 30bps in May. We should expect fixed mortgage rates to increase if they hold at this level. If you are thinking of buying, refinancing or if your mortgage is coming up for renewal, I suggest you contact your mortgage broker and get some rates held. This could be the beginning of the long-awaited mortgage rate hikes.

There is another chart you should look at if you want to see where Fixed mortgage rates are headed over the next 6 months. The 2 year Govt of Canada bond yields are a good 6 month indicator of where rates are going…. and this chart shows the 2 year bond yields jumped over 25bps in May.

We’ll report any changes as they get announced.

Your best interest is my only interest.

As always, I welcome your comments, calls and questions.

Steve Garganis 416 224 0114 steve@mortgagenow.ca

Posted May 10, 2013 Money saving tips

Mortgage rates hit all-time lows….it all adds up to record savings too.

Mortgage rates are still low… In fact, they are at record lows… 5 year fixed rates for qualify products can be found at 2.89%… some No Frills products are at 2.79% (stay away from these products).. Put another way, for every $100,000 of mortgage you borrower, your payment is $468/mth.

Compare this with the average 5 year fixed rate for the past 25 years being over 7.00% and you have huge potential savings. That same $100,000 mortgage would cost you $700/mth… That’s a $232/mth difference. No wonder more Canadians are buying homes, buying rental properties or tapping into their equity to invest. Continue reading “Mortgage rates hit all-time lows….it all adds up to record savings too.”

Posted May 8, 2013 Bank News

More BIG SIX BANK penalty nightmares… when will Canadians learn to look elsewhere for their mortgage?

Here’s a great article from The Star’s Ellen Roseman on mortgage penalty nightmares. She shares just a few stories out of the dozens she’s received over the past little while. There is no reasonable justification for charging borrowers these inflated penalties… If you think your immune from these penalties, think again.

Notice the name of the Banks that are mentioned in her article… Yes, part of the BIG SIX club… Don’t get lulled into believing that dealing with a BIG SIX BANK offers some sort of immunity from higher penalty charges… The experiences of these borrowers and countless others proves otherwise…

I’ve been getting more calls and comments on this recently… $10,000, $15,000, $20,000 in penalties. How is it that the smaller Lenders can offer the same or better interest rates, and not charge these inflated penalties? The BIG SIX BANKS reported a record $30billion combined profit in 2012…!! Doesn’t make any sense, does it? And yet, it continues…

Remember, there are several other Lenders that don’t calculate their penalties with the same inflated formula… Seek advice from a mortgage broker… get another opinion… There are better options and I have access to them! It’s no secret…. I’m happy to share this info to anyone that wants it.

Come on Federal govt… do something to stop this madness and protect Canadians from this gouging!

Your best interest is my only interest!

As always, I welcome your comments, calls and questions.

Steve Garganis 416 224 0114 steve@mortgagenow.ca