Mortgage Bytes

  • Canadian-Bond-Yields The drop in bond yields has been stunning the past two weeks.  On Thursday the 5-year bond closed at 2.95%, the lowest yield in over 27 years!  Can bond yields go much lower before bouncing?  We’ve got no clue…but we’re glued to our monitors.  (Chart from Bank of Canada.)
  • Is Canada’s economy really that doomed? 
    • “No,” says Laurentian
    • “Yes” says Garth Turner. (Worth a read just to see Jonathan Chevreau call 40-year amortizations “atrocities.”)
    • “No” says CIBC.
    • Don’t count out the U.S. for long says the Leader-Post.
  • The Calgary Real Estate Market Blog writes about how mortgage spreads might help real estate timing.
  • MoneySense reminds us that our real estate boom is not indefinite.  They note the average house would cost $10 million by 2037 if price gains maintained their pace of the last nine years.
  • Lenders will tell Michael Jackson to “beat it” if he doesn’t start paying his mortgage.
  • The average Vancouver detached house is now $921,000!
  • CREA says “consumer confidence, employment and affordable interest rates” will keep Canada’s real estate market afloat in 2008.
  • Canada’s ABCP debt restructuring is delayed again.  Does anyone believe the investor committee’s deadlines anymore?
  • Canadians have record non-mortgage debt but they’re still paying their bills on time.  Equifax says Canada’s delinquency rate is now just 1.2%, versus 1.6% in 2005.
  • As home prices keep falling, Americans now have more mortgage debt than home equity for the first time on record. 
  • Million Dollar Journey has an excellent Smith Manoeuvre resource page.
  • The Times Colonist reminds us not underestimate closing costs.
  • There are record foreclosures in the U.S. but it’s not anywhere near as bad here. In Toronto there are approximately 315 power of sale homes–about the same as last year.
  • RBC gained market share last quarter as its mortgage volume increased 15% year-over-year. The jump was driven largely by “strong demand for home equity lending,” among other things.
  • Desjardins had record profits in 2007, along with 7.4% growth in their mortgage business. The company is the dominant mortgage lender in Quebec, with a 39.2% market share.
  • IMBA is accepting nominations for its Ontario “Broker Recognition Awards.” Nomination form.

Mortgage Planner Notes

  • Mortgage Architect’s Marg Green says lenders are making “fewer exceptions on borderline deals.”  She says, more and more, “They are sticking to their guidelines…”
  • If you’re a mortgage planner, Abode Mortgage has a compelling “A” product suite. They pay appraisal costs up to $500, have solid rates, offer excellent compensation, and can underwrite deals as non-prime if they don’t fit “A” credit guidelines.
  • Bridgewater Bank now does 2nd mortgages behind its first mortgages…to 95% loan-to-value and with 40-year amortizations.
  • Did you know?  Gifted down payments and borrowed closing costs are both acceptable under AIG’s Equity Assist program.  Source: MyNext Mortgage
  • Xceed’s self-insured Flex program is designed for self-employed borrowers.  Its highlights:
    • Gifted or borrowed downpayments are permitted
    • 2nd or vendor-take-back mortgages are allowed behind Xceed’s first
    • No NOA’s required
    • Only one month of down payment verification and no proof of closing costs
    • Registration can be in a company name (with a personal guarantee)
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