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19 Apr

Mortgage and real estate review April 20th 2013


Posted by: Brian Mill

Now that the snow is gone and the weather is starting to feel a “bit” like spring, activity is really picking up.  2 weeks ago I had one of the busiest weeks I’ve ever had for preapprovals and now the offers are starting to fly.  I have had 2 actual deals fall apart due to sellers who were unwilling to budge on their price, and I’m not sure if this is a trend or just a coincidence.  Hopefully we don’t have a market full of overpriced listings and unrealistic sellers. 


No change on the interest rate front.  I can still to 2.84% and 2.89% on a rental property so if you have anyone looking at buying rentals, make sure they talk to me.  More and more lenders are adding premiums on rates on rental properties as they are inherently a bit riskier than a principal residence.  I can help your clients sift through the myriad of things to consider when buying and mortgaging a rental property.


Did you know? Collateral mortgage charges have become a hot topic recently as some lenders have changed their policies and ALL of their mortgages are done on a “collateral charge” as opposed to a “conventional charge”.  The advantage to a collateral charge is the ability to re-advance funds up to 80% loan to value after the mortgage has been paid down below this level and/or have a line of credit or other revolving credit secured by your residence.  The disadvantage is that on renewal, if you were to switch your mortgage to another lender, the mortgage actually has to be discharged from the title and another mortgage put in its place, meaning a set of legal fees to do this.  One of the major banks was on Marketplace (The TV show on Sunday AM at 10:30 on CBC) recently as they have been doing this and not disclosing to their clients that they would have to discharge the entire mortgage to switch it out.  These lenders are using this as a “retention” tool instead of for its other uses since it is much harder to switch out on renewal.  Contact me for information on who does this and who to watch out for!


Please feel free to call me anytime this weekend at 519 379 3003…..I will be happy to answer any questions or speak with your clients directly.




Brian Mill, B.A.