Rates as of June 19th, 2012
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Borrowers must qualify on approved credit and rates are subject to change without notice. All rates shown are the annualized percentage rate (APR) and do not
reflect all lenders. Rates may vary from lender to lender.
*Special conditions apply, please call us for more information.
| Key Interest Rates |
| Qualifying Rate | 5.24% |
| Prime Rate | 3.00% |
| Next BoC Meeting | July 17, 2012 |
| LOAN TERM | OUR RATES |
| 1 Year | 2.74%* - 2.89% |
| 2 Year | 2.74%* - 3.05% |
| 3 Year | 2.89%* - 3.19% |
| 4 Year | 2.99%* - 3.25% |
| 5 Year | 3.09%* - 3.19% |
| 7 Year | 3.95%* - 3.99%* |
| 10 Year | 3.89%* - 3.99%* |
| 5 Year Floating Rate | 2.90% (Prime -.10%) |
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This spring the Office of the Superintendent of Financial Institutions (OSFI) announced several proposed changes to mortgage lending, such as cutting back the maximum line of credit mortgage to 65% (from 80% of the homes value), and now today the Finance Minister, Jim Flaherty made an announcement confirming what many of us expected, they will be making the 4th change in 4 years to tighten mortgage lending on Government insured loans. Again, the reason for these changes is to protect Canadians by reducing debt, and these changes will likely cool down our real estate market somewhat.
1) FOR PURCHASES: Government will cut back amortizations on CMHC mortgages to 25 years (currently it is 30 years). This will affect borrowers who are buying real estate with less than a 20% down payment. The shorter amortization helps borrowers to pay off their mortgage faster, thus reducing interest costs.
2) FOR REFINANCES: CMHC will no longer allow borrowers to refinance up to 85% of their home’s value. The new limit will be 80% of the home’s value.
3) Also affected is their qualification guidelines, looks like the maximum gross debt service ratio (GDS) will be capped at 39%. That means that a maximum of 39% of the borrower’s gross income must be sufficient to cover their mortgage payment, property taxes, heat and 50% of maintenance fees (if applicable).
We will keep you posted on these changes.
Chana Fay Charach, AMP
team@SynergyMortgage.ca
t: 604.269.9419
PS: Please call us if you would like further information or clarification on any of the changes or a copy of the OSFI report. |
