What's all the fuss about?
A bit of perspective on the current housing market and mortgage rates.
New rules effective April 19th will impact some home buyers that may not qualify at the higher rates. But, for many home buyers with at least 20% down and those with equity moving to a newer or larger home the changes won't matter that much.
I took a look back at the
rates for April 2008 when house prices were strong and the
posted five-year fixed rate was almost 7% with broker discounted rates in the mid-high 5% range. Posted rates now for a
five-year fixed-rate mortgage are around 6% with broker discounted rates around 4.3%. The prime rate is 2.25 per cent when in April 2008 it
was 5.25 per cent. So, in a high priced market rates were higher than now and people still bought, moved - lived their lives.
For those with higher rates who worry about what will happen in 2,3 or 5 years - talk to your broker. Run the numbers to be sure you are on track with what is best for you. You can't know for sure until you take a look. Rates today are still very good and with the right help you can set a strategy in place to help you stay on track and sleep at night.
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Best Rates
RESIDENTIAL MORTGAGE RATES
As of Tuesday May 4, 2010
TERM
INTEREST RATE
1 year 2.55%
2 year 3.10%
3 year 3.75%
4 year 4.14%
5 year 4.34%
7 year 4.90%
10 year 5.55%
Open Variable rate 3.05% (P+.8)
Closed 5-year variable rate 1.75% (P-.50)
Home Equity Line of Credit 3.25% (P+1)
Prime (P) is currently at 2.25%.
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Tax Planning for Bigger Refunds
Simple steps today to help you save on taxes tomorrow
Courtesy of David Perkins - Certified Financial Planner (604) 889-6497.
A recent study by the Fraser Institute suggested
that Canadians spend approximately 5 hours on tax preparation including gathering information, preparing for and
meeting with a tax preparer or completing their own returns. In my 16 years as a financial planner I've
observed that most people spend less than 1 hour per year on their tax planning. The difference between
the two is that tax preparation amounts to filling in the blanks of a tax
return, while tax planning is about analyzing the tax implications of personal
and business decisions during the year in order to pay less tax. In other words, tax preparation is about
reporting what you've already done while tax planning is about reducing your
future tax.
So here is a tax planning tip to start your
new tax year off right. If you are
applying for a mortgage for your new home, consider liquidating your
non-registered investments and repurchasing the same investments with funds
from your mortgage or line of credit. For
example, if you are taking out a mortgage for $300,000 to buy a home and have
$100,000 in mutual funds (funds not held in a registered account such as an
RRSP or TFSA), liquidate the mutual funds and increase your down payment on
your new home. Apply for the same
$300,000 mortgage as you originally intended.... read on at my blog at www.mybcmortgage.ca.
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Buying a House with Suite?
Can you use rental income to qualify for the mortgage?
Regardless of whether you are buying a home with 5% down or 20% down you can use the rental suite income to offset your mortgage. CMHC require the suite be legal. However, other insurers (Genworth) do not. We can use 50%-100% of the income to help you qualify for your mortgage.Call me for details.
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