New Mortgage Rules You Need To Know
Hi everyone
By now you’ve probably heard or read in the news that the federal government is making changes to mortgage rules to ensure that Canadians don’t take on more debt. There is a lot of confusion regarding whether or not buyers will be required to provide a larger down payment or have to meet stricter qualifications. So what are these changes and how do they affect you?
There are 3 major changes you’ll need to know about:
- Qualifying at a 5 year rate
All borrowers will be required to meet the standards for a five-year fixed rate mortgage even if they choose a mortgage with a lower interest rate and shorter terms.
- Refinancing limited to 90% of the loan-to-value ratio
Currently, borrowers are able to refinance their mortgage up to 95% of the property value. This amount has now been reduced to 90%, in order to help homeowners maintain equity in their home.
- Minimum 20% down payment required on non-owner-occupied properties
A 20% down payment will now be required for small (ex. 1 – 4 unit) residential rental properties if the owner does not occupy the property. If the owner intends to live on the property (ie. a rental property), they will still be able to purchase the property with only 5% down.
These changes will go into effect on April 19, 2010.
For more details, visit my thread on my message board.
Buying a home in Brampton with no money down
If you’re thinking of buying a home in Brampton soon and are worried about coming up with a down payment, there is still a zero down mortgage program available for you to explore. Essentially, what you would be getting is a cash back from the lender that you would apply as your down payment.
This mortgage program is a lifesaver for those who want to take advantage of the low interest rates and brisk real estate market in Brampton, but don’t have enough cash in the bank as a down payment. The interest rate will not be as low as a regular mortgage with 5% down, but it does get home buyers into a position where they can own their own home at an affordable monthly mortgage payment.
Here are some quick details:
- A minimum of 650 credit score is required
- Maximum cash back from this program is $25,000
- Amortization is 35 years
- Mortgage is calculated on a 5 year at the posted rate (currently 5.39%)
If you’re currently renting and am considering owning a home, but don’t have the cash for a down payment, this program may be for you. Don’t let this strong Brampton real estate market pass you by!
For more details, visit my thread on my message board. If you would like to see if you can qualify for this mortgage program, leave me a comment here or email me!
If you’re still sitting on the fence regarding whether it’s a good time to buy or not, here are the latest rates that I can get for you. Now is absolutely the time to pick up a pre-approval and lock in. Remember, your pre-approval rate will be guaranteed for 90 days, so even if the rates go up in April as anticipated, you’ll still be able to use these rates when it comes time to buy a home.
Contact me if you’re interested in getting these rates.
1 year fixed: 3.25%
3 year fixed: 3.75%
4 year fixed: 3.69%
5 year fixed: 3.89%
** UPDATE **
The 5 year rate is now 3.80%
Take a look around. In the U.S., the housing market is crumbling leaving some desperate home owners throwing their keys back at lenders while others are deliberately burning their houses down. Up here in Canada, the real estate market is still going strong and with recent reductions in interest rates, what does this all mean?
If there isn’t a better time than now to get more educated about mortgages, lending practices, and borrowing strategies, I don’t know when that would be. Enter MortgageFit.com.
Let’s face it, finding answers to all your questions is sometimes pretty frustrating. Either you’re given the runaround or the person isn’t qualified enough to give you an adequate response. MortgageFit boasts the world’s largest mortgage community and is comprised of knowledgeable members who can give you free mortgage advice as well as free online quotes. If you have a question on a particular topic, ask away in their discussion forum and rest assured one of their thousands of members will come to your aid. Need answers fast? The site also provides a myriad of articles and references that you can browse at your own convenience, as well as online calculators that help you quantify your needs.
What I like most about this site is that it’s powered by people. Take a quick look through their message board and you’ll find a community alive with questions, stories, and friendly chatter. If you need quick answers on mortgages, credit issues, debt, and other financial issues, I recommend checking out MortgageFit.
Hi Tim It's currently at 3.80% for a 5 year fixed. Lang
please give me a quote for 5 year fixed rate.thanks