If you have a fixed rate mortgage, you may be able to get a better interest rate or even acquire additional funding by breaking your mortgage. Unfortunately, you will have to go through your disgruntled lender and the subsequent prepayment penalty. The penalty protects lenders against losses and usually represents the profit the lender was going to make on your mortgage had you not broken it early. Continue reading →
Over the last decade house prices in Canada have doubled and the market continues to grow. The demand for property is illustrated by the fact that there are 173 sky scrapers being built in Toronto, the highest number in North America. New York, with nearly four times the population, has only 96 under construction, while Chicago has just 17.
The continued growth is due to the strength of the Canadian economy and The Bank of Canada keeping interest rates at record lows, with our five year fixed rate currently at 2.99%. The low fixed rate, combined with mortgage insurance underwritten by the Canadian Mortgage and Housing Corporation (CMHC), has led to financial institutions lending out record amounts to both Canadians and foreign speculators who have hoovered up property in Canada. Additionally, the competition for property is so intense it has pushed house prices up to the highest levels ever, meaning the average Canadian needs to take on even bigger loans to afford the ever increasing price of housing in Canada. Continue reading →