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Posted April 14, 20171 Comment Bank News

Enjoy the low rates..No rate hike with Bank of Canada

The Bank held their third, of eight, scheduled meetings this week. As widely predicted, the Bank of Canada announced that it is holding the key rate steady.

While noting that “economic growth has been faster than expected”, the bank said it’s too early to determine if the economy is on a “sustainable growth path”, citing weakness in export growth, business investment and employment.

The Bank’s three measures of core inflation, taken together, continue to point to material excess capacity in the economy. While there have been recent gains in employment, little growth in wages and hours worked continue to reflect economic slack in Canada, in contrast to the United States.

The bank also took into account uncertainties that include the potential impact of U.S. trade policies. The next rate-setting day is May 24.

This announcement means there should be no change to the prime rate. Great news if you have a variable-rate mortgage or line of credit, need a new mortgage, are renewing, or want to save thousands by consolidating debt at the lowest-cost funds. Or perhaps you are thinking of using home equity to invest in a rental property or second home, or cost effectively complete renovations.

Given the uncertain economic outlook, we continue to expect interest rates to stay low in Canada well into 2020, although the new mortgage rules have caused mortgage rates to be very complicated. Quick rate quotes are not very reliable! That’s why it’s so beneficial to work with an experienced mortgage broker who has access to a wide range of lenders and knows the right questions to ask to assess your situation and provide the best mortgage for your needs. Save yourself time and stress; don’t just ask what the rate is, have a conversation instead.

Your best interest is my only interest. I reply to all questions and I welcome your comments. Like this article? Share with a friend.

Steve Garganis 416 224 0114 steve@mortgagenow.ca

Posted March 15, 2017 Bank News

BIG FIVE BANKS employees speak out about deplorable sales tactics… and it’s gone viral!

A news story from CBC has gone viral. The BANK employees are under tremendous pressure to sell YOU products. They will say and do almost anything, according to the CBC news article.

For those of us working in Financial Services, this is old news. Stories of high pressures sales and tied selling has been going on for over two decades. Sales targets were introduced to the retail branch network in the ’90s. It was the beginning of a new sales culture. Prior to this, bank tellers and account managers had always worked with a ‘soft sell’ approach. They were there to help and service your needs. This was about to change forever.

Your bank teller is now scanning your financial profile to see if they can up sell you some bank product. Last week, my son and I were in the TD Bank and they informed my son he was preapproved for a TD Visa card.. of course, there was a small annual fee… so we can add to the BANK’s $billion profits!

Now we are seeing Mobile Mortgage Reps working for Banks. They come to your home or business. They are paid on a commission basis. Think about it. How can anyone expect them to be unbiased? They can only sell you one brand and one range of products. Are all mortgage products the same? They can never truly provide neutral advice or recommend other brands.

It will be interesting to see if this issue gets swept under the rug or if it will become a big stink. The BIG FIVE BANKS rank in the top EIGHT largest corporations in Canada. And last year, RBC was the first Canadian corporation to report over $10billion in net profit.

Hmm, I wonder how they make all that money, year after year, after year, after year.

Your best interest is my only interest. I reply to all questions and I welcome your comments. Like this article? Share with a friend.

Steve Garganis 416 224 0114 steve@mortgagenow.ca

Posted February 28, 20174 Comments Rate forecast

Panic buying? When will the housing market slow down?

Houses selling over asking price is becoming the norm, these days. Kinda crazy. Sometimes a house is just listed under market value to attract a frenzy of buyers. An old tactic that has worked well in larger urban markets. Today, that tactic is being used in smaller communities, too.

What’s unclear is if this selling tactic is contributing to houses selling for more than they’re worth. And what is a home worth, anyway? I always thought a house was worth what someone was willing to pay in the open market. That’s still true in most cases, today.

When I see reports of houses selling for $100k, $200k and $300k over asking, it makes me wonder. How long will this market last? Will it crash? And if so, when? It’s hard to make forecasts and I can’t see into the future, but let’s examine this a little.

WHEN WILL THE HOUSING MARKET CRASH? Continue reading “Panic buying? When will the housing market slow down?”

Posted February 27, 2017 Bank News

Another example of BIG SIX BANK inflated penalty calculation.. $13,634.00! Wow!

If you still think your local BANK is your best friend, think again. Last week, one of my client’s discovered it would cost them $13,634 to exit their mortgage early. Compared with only $2736 if they had chosen a BETTER mortgage Lender.

Here’s the details.. The clients had a $395,000 mortgage balance remaining. Renewal date was October 2018. Original term was 5 yrs and their rate was 2.77%. The rate is competitive, but not any better than what I could have offered at that time. There had to pay the mortgage out.

Penalty quote is $13,634. That’s equal to over 14 months interest!! Wow! Incredible. $13,634 compared to $2736.

I’ve shared many examples similar to this in the past. It’s really simple. DON’T FOCUS ON THE RATE!. There is so much more to choosing a mortgage than just rate. The average Canadian changes their mortgage ever 3 years. And there are many reason this happens.. change of job, marital status, family issues, health issues, etc.

And if you are expecting your Banker to show you other products to compare, well, that’s just not gonna happen. It’s like expecting Ford to send you to Toyota for a new car. Not gonna happen. Do yourself a favour and speak with an unbiased, neutral professional. Speak with an experienced Mortgage Broker that deals with dozens of Lenders. You’ll be glad you did.

Your best interest is my only interest. I reply to all questions and I welcome your comments. Like this article? Share with a friend.

Steve Garganis 416 224 0114 steve@mortgagenow.ca

Posted February 21, 2017 Mortgage News

Finally, a tax break on Land transfer tax.

Did you get a larger Land Transfer Tax rebate?

If you bought a home this year, and you’re a first time home buyer, then you’ll pay less tax.. The Ontario provincial govt has doubled the rebate from $2,000 to $4,000. The rebate is for qualified first time home buyers only.

They also eliminated Land Transfer tax on the first $368,000 of the purchase price for first time home buyers. Hey, this is good news. And I applaud the govt for giving for giving first time buyers a break.

They also increased the Land Transfer Tax for homes over $2million. Here’s the old and new tax tables.

“Old” Ontario Land Transfer Tax Rates
Home Purchase Price Tax Rate
Up to $55,000 0.5%
$55,000 to $250,000 1.0%
$250,000 to $400,000 1.5%
Above $400,000 2.0%

And here’s the new formula…

“New” Ontario Land Transfer Tax Rates
Home Purchase Price Tax Rate
Up to $55,000 0.5%
$55,000 to $250,000 1.0%
$250,000 to $400,000 1.5%
$400,000 to $2-million 2.0%
$2-million and over 2.5%

Enjoy the savings..

Kinda strange.. Remember when the Kathleen Wynne govt was considering allowing other municipalities, other than Toronto, to introduce a new land transfer tax? NO? Well, I do.. and you shouldn’t forget it either.. click here to remember.. Keep this in the back of your mind .. Let’s hope this isn’t some sort of strategy to catch us with our guard down..

Your best interest is my only interest. I reply to all questions and I welcome your comments. Like this article? Share with a friend.

Steve Garganis 416 224 0114 steve@mortgagenow.ca