Ramon Bautista - Mortgage Agent

12/16/2024

Canada’s new mortgage and down payment rules come into effect today. Here’s what you need to know

Effective today, the following changes will be made for default insured mortgages:
 
Increasing the $1 million price cap for insured mortgages to $1.5 million. Before this change came into effect, first-time buyers of homes purchased for over $1 million had to put at least 20 per cent down.

Expanded eligibility for 30-year mortgage amortizations for all first-time homebuyers and all buyers of new build properties.

These updates could open new opportunities if you’re a first-time homebuyer. Reach out if you have questions!

12/12/2024

Today, the Bank of Canada cut its policy rate by 50 basis points (0.50 percentage points), bringing it down to 3.25%. This is the fifth reduction this year and will result in a lower prime rate — which affects variable-rate mortgages and other loans.

We anticipate most lenders will lower their prime rates to 5.45% in the coming days, with TD Bank’s mortgage prime, which is priced slightly higher, likely dropping to 5.60%.

How does this impact you?

If you have a variable-rate mortgage: This could mean lower interest costs soon! If your payments are fixed, more of your payment will go toward reducing the principal. If your payments adjust with the prime rate, your monthly payment should reduce by roughly $28 per $100,000 of mortgage loan, based on a 25-year amortization.

Other loans tied to the prime rate: Personal loans or lines of credit will also see a drop in interest charges.
Looking ahead

The Bank of Canada’s next rate decision is scheduled for January 29, 2025. We’ll need to wait for incoming data to see if a rate cut is likely for January.

If you have questions or want to discuss how this rate cut impacts your mortgage, I’m here to help! Feel free to reach out.

11/11/2024

Lest we forget day

10/23/2024

Today, the Bank of Canada lowered its policy rate a half percentage point, bringing it down to 3.75%, a reduction of 1.25% from its peak. This is the fourth consecutive rate cut this year, and it could bring a bit of relief if you have a variable-rate mortgage or other loans tied to a bank’s prime.

What’s next?

Lenders usually take a few days to adjust their prime rates after the Bank of Canada makes a move. We’re expecting the prime rate to drop to around 5.95% at most lenders, while TD Bank’s prime rate should land around 6.10%.

What does this mean for you?

If you have a variable-rate mortgage: Good news! You’ll likely see lower interest costs of approximately $29.96 per $100,000, based on a 25 year amortization, soon. If your payments are fixed, more of your payment will go toward the principal. If your payments adjust with the prime rate, your monthly payment should decrease a little.

If you have a fixed-rate mortgage: Nothing changes for now — your payments will stay the same.
Other loans tied to the prime rate: Things like personal loans or lines of credit will also see a drop in interest charges.
Looking ahead

The Bank of Canada’s next rate decision is scheduled for December 11, 2024, and markets are already expecting another rate cut. While nothing is guaranteed, this could mean even more relief for borrowers in the coming months.

If you have any questions or want to chat about how this might impact your mortgage, feel free to reach out. I’m always happy to help! .....
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09/16/2024

Breaking News! Government announces new mortgage reforms:

Increasing the $1 million price cap for insured mortgages to $1.5 million, effective December 15, 2024, to reflect current housing market realities and help more Canadians qualify for a mortgage with a downpayment below 20 per cent. Increasing the insured-mortgage cap—which has not been adjusted since 2012—to $1.5 million will help more Canadians buy a home.

Expanding eligibility for 30 year mortgage amortizations to all first-time homebuyers and to all buyers of new builds, effective December 15, 2024, to reduce the cost of monthly mortgage payments and help more Canadians buy a home.

estate

09/16/2024

Breaking news! Mortgage reforms:

Increasing the $1 million price cap for insured mortgages to $1.5 million, effective December 15, 2024, to reflect current housing market realities and help more Canadians qualify for a mortgage with a downpayment below 20 per cent. Increasing the insured-mortgage cap—which has not been adjusted since 2012—to $1.5 million will help more Canadians buy a home.

Expanding eligibility for 30 year mortgage amortizations to all first-time homebuyers and to all buyers of new builds, effective December 15, 2024, to reduce the cost of monthly mortgage payments and help more Canadians buy a home.

https://www.canada.ca/en/department-finance/news/2024/09/government-announces-boldest-mortgage-reforms-in-decades-to-unlock-homeownership-for-more-canadians.html?fbclid=IwZXh0bgNhZW0CMTEAAR1AbGNxDi2l5NG3kU1dF1dD6E8PWwmTNrLl2OT6Ftfit_JEWDY352xatWA_aem_zd9OABkqG1VVpppqfW1nZw

The Honourable Chrystia Freeland, Deputy Prime Minister and Minister of Finance, today announced a suite of reforms to mortgage rules to make mortgages more affordable for Canadians and put homeownership within reach:

09/06/2024

More interest rate relief. On Wednesday, Bank of Canada reduced the policy rate by .25%.

What does this mean for you?

For those with fixed-payment variable-rate mortgages, this is good news! You should see a reduction in the interest portion of your payment.

If you have an adjustable-rate mortgage, where your payment changes with the prime rate, you’ll notice a slight decrease in your next payment.

For those with fixed-rate mortgages, this rate cut won’t affect your current term or monthly payments.

Other loans tied to the prime rate, like certain personal loans or lines of credit, will also see a reduction in interest charges or monthly payments.

Looking ahead

The Bank of Canada’s next rate decision is set for October 23. Whether another rate cut will occur depends on the economic performance in the coming weeks, but markets are leaning towards another possible cut.

If you have any questions or want to discuss how this might impact your mortgage strategy, feel free to reach out. I’m here to help!

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07/24/2024

🏦 Today, the Bank of Canada announced a 25-basis point cut to the benchmark rate, bringing it down to 4.50%. This is the second rate cut and will further help to ease interest costs for those with variable-rate loans.

What does this mean for you?

This is great news for those with fixed-payment variable-rate mortgages! You can expect to see a decrease in the portion of your payment that goes towards interest.

If you have an adjustable-rate mortgage, where your payment fluctuates based on prime rate, you will notice a small decrease in your next payment.

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04/18/2024

The federal government made several announcements claiming it will improve access to the housing market for first-time buyers.

The announcements include:

Increasing the maximum amortization period to 30 years from 25 for first-time buyers purchasing a new-build property with a down payment of less than 20%, otherwise known as a default-insured mortgage. This change will take effect August 1.

Increasing the Home Buyers’ Plan limit to $60,000 from $35,000. This federal program allows first-time homebuyers to withdraw funds from their Registered Retirement Savings Plan (RRSP) tax-free as long as they are used towards the purchase of their first home and are repaid within the subsequent 15 years.

First-time homebuyers who withdraw from their Home Buyers’ Plan between January 1, 2022 and December 31, 2025 will see their repayment grace period extended by three years. These buyers will now have a grace period of up to five years before they are required to start making repayments.

Do these measures help first time home buyers? Let me know your thoughts......
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04/10/2024

🏦 As for announcements that affect mortgage rates, today was a double whammy.

The Bank of Canada held the overnight rate at 5%, which is expected. The overnight rate affects lenders’ prime rates.

US inflation unfortunately blew past expectations and caused a spike in the US 10 year Treasury Yield. This causing a spike in the Canadian Government of Canada Bond yield. Mortgage fixed rates are tied to the bond market, and Canadian bond markets rise in tandem with US bond markets. If this trend continues, we may see fixed rates increase in the short term.

I continue to monitor incoming economic data and how it affects mortgage rates. If you or your clients have financing questions, i have solutions. Please connect with us....
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01/24/2024

As expected, the Bank of Canada has left its key lending rate unchanged at 5.00%.

This follows 10 previous rate increases over 12 rate announcements, which raised the overnight target rate by 475 bps since March 2022.

In its statement, the Bank said it is “still concerned about risks to the outlook for inflation, particularly the persistence in underlying inflation.”

However, the Bank added that with expected GDP growth of just 0.8% in 2024, it expects inflation to continue to ease from around 3% in the first half of 2024 to its 2% target in 2025.

What happens now?

As a result of today’s decision, prime rate will remain unchanged at 7.20% and there will be no changes to existing variable-rate mortgages. This announcement also has no impact on fixed-rate mortgage holders.

The Bank’s next announcement will take place March 6.

If you have any questions or concerns about the rise in borrowing costs over the past year, I encourage you to reach out so we can discuss your personal situation and options. .....

01/08/2024

Market expectations is for the 🏦 Bank of Canada to start cutting rates sometime in 2024.

Here’s a schedule of the Bank of Canada announcements. Or visit my website to subscribe. ......
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