Laking Financial

04/13/2022

Bank of Canada raises rates by 0.50%
It is the largest single rate hike in 2 decades.
Bank of Canada hoping to tame inflation.

The Bank of Canada hiked its benchmark interest rate by half a percentage point to one per cent on Wednesday, a sign the bank is making good on its pledge to battle runaway inflation.

07/14/2021

Bank of Canada holds rate at current historic low!

The Bank of Canada announced today that it is maintaining the benchmark rate. While Covid’s 3rd wave slowed growth, our progress in fighting the virus points to strong economic growth for the rest of the year. Consumption is expected to lead the recovery but the pace of that recovery will vary among industries. The pandemic has caused structural changes in the economy which continues to make forecasting uncertain.

The Bank has determined that the recovery will still require extraordinary monetary policy support until slack in the economy is absorbed and the 2% inflation target is sustainably achieved, which they again anticipate will be in the second half of 2022.

The next rate-setting day is September 8th, 2021.

With rates still extremely low, this is a great time to get in touch for a review of your mortgage strategy. It's important to get advice and a professional assessment of your situation if you want to switch your mortgage for a lower rate, need a new mortgage, are renewing, or looking to refinance for debt consolidation, renovations or other large expenditures.

07/06/2021

Great news for buyers with less than 20% down that can benefit from using a specific Canada Mortgage & Housing (CMHC) program!

CMHC is returning to their pre-July 2020 underwriting guidelines for homeowner mortgage default insurance, specifically they will again consider a Gross Debt Service (GDS) ratio up to 39% and a Total Debt Service (TDS) ratio up to 44% for borrowers. They are now in line once again with Sagen and Canada Guaranty.

03/10/2021

The Bank of Canada announced today that it is maintaining the benchmark rate, noting that our recovery is better than anticipated but that economic slack and uncertainty remain, particularly given the rise of more transmissible variants of COVID-19. The Bank has determined that the recovery continues to require extraordinary monetary policy support, and they will continue with quantitative easy until the recover is well underway.

The Bank did not comment on when they believe the economy will have recovered enough to raise rates.

The next rate-setting day is April 21st, 2021.

With rates still extremely low, this is a great time to get in touch for a review of your mortgage strategy. It's important to get advice and a professional assessment of your situation if you want to switch your mortgage for a lower rate, need a new mortgage, are renewing, or looking to refinance for debt consolidation, renovations or other large expenditures.

11/11/2020

10/28/2020

The Bank of Canada announced today that it is keeping the overnight rate steady at 0.25%. It is expected the Bank will keep this target unchanged until well into 2023 to aid our economic recovery. The Canadian economy is in recession with negative GDP growth, inflation is at zero, the Canadian dollar relative to the U.S. is stable at around $.76, oil prices are hovering around $40 - $43 U.S./barrel and unemployment is currently at 9%, another marked improvement from last month.

According to StatsCan and CMHC, 75% of the almost $200 Billion of mortgages that were deferred were from Canadians that are still working and took the deferral as a precautionary measure. This would support the argument that the massive wave of defaults on mortgages previously expected is likely to be avoided this winter. In addition, unemployment has been forecasted to rebound to 7.5% by the end of 2021.

Cam Strong, CEO of Invis Mortgage Intelligence stated “Most economists agree personal debt levels will likely worsen in 2021 and the hospitality sector will face record bankruptcies or closures. However, record low mortgage rates should continue to support our housing industry along with an improving employment outcome in 2021.”

Canadians have record high mortgage and consumer credit debt of $2.5 trillion according to Statistics Canada as of September, 2020 however, thanks to the Bank of Canada, the servicing costs on this debt is very low.

The next rate-setting day is Wednesday, December 9th.

With this stable, low interest environment it’s never been a better time for qualifying homeowners to refinance to consolidate debt to improve cash flow, save interest costs and protect their credit scores. Always get advice and a personal assessment of your situation if you need a new mortgage or want to change your current mortgage strategy.

08/11/2020

With the major Banks lowering their posted 5-year fixed rates, the qualifying rate will drop to 4.79%, which makes it slightly easier to qualify for a mortgage!
The qualifying rate is used in stress tests for both insured and uninsured mortgages, and a lower rate is good news for anyone who needs a new mortgage – homebuyers, those looking to refinance or renew their mortgage at a different lender for a better deal.
Get in touch to see how much you qualify for!

07/15/2020

Today’s Bank of Canada announcement, as expected, held the Overnight Rate at 0.25%.

The highlights are as follows:

"The Canadian economy is starting to recover... With economic activity in Q2 estimated to have been 15% below its level at end of 2019, this is the deepest decline in economic activity since the Great Depression, but considerably less severe than worst scenarios presented in April."

"There are early signs that the reopening of businesses and pent-up demand are leading to an initial bounce-back in employment and output. In the central scenario, roughly 40 percent of the collapse in the first half of the year is made up in the third quarter."

full report can be read here: https://www.bankofcanada.ca/2020/07/fad-press-release-2020-07-15/

07/07/2020

Even though CMHC recently announced more strict criteria to be approved for insured mortgage financing their competitors Genworth and Canada Guarantee are not following suit. So for anyone who this would have impacted there is no need to worry!

Following the announcement of CMHC's new mortgage rules last week, Genworth Canada and Canada Guaranty confirmed they will not be following CMHC's lead.

06/04/2020

Breaking News: CMHC (Canada’s largest mortgage insurer) just announced tougher mortgage qualifying rules that will be effective July 1st for any new applications. They are also forecasting that due to the impacts of COVID-19 that the average home price in Canada will fall between 9-18% over the next 12 months.

The new rules include tighter GDS/TDS Guidelines which ultimately impacts the amount of monthly income that can go towards housing costs and total debt servicing.

Increase in minimum credit score so you’ll need to have stronger credit.

Please feel free to reach out if you have any questions

Protecting the economic futures of Canadians: CMHC reviews underwriting criteria

05/08/2020

For those who are in need the next period of CERB will be opening up in a few days. You do need to re-apply for every time period that you are eligible.

04/03/2020

Applications for the Federal Govt CERB program are available as of Monday please check the date when you can apply. It’s all completed through the CRA My Account site.