Prime remains 2.25% Fixed rates may blip^
Surrey, BC - May 28, 2009 - The Bank of Canada meets next on June 4th, when they are expected to leave Prime alone. We hear rumblings fixed rates may blip up due to Bond yields blipping up with more money moving into the stock markets over the past few weeks. Expect the 5 year to move from around the 3.75% range to the 3.95% range.
We expect to see these blips over the next year, with a small increase or decrease in the fixed rates depending on which way the US stock market moves. Until the US has a real turnaround in their Real Estate market however, rates will stay down overall...as previously said, we expect until the third quarter or end of 2010 that rates will be down. Prime will stay the same until at least mid way through 2010 or longer.
Variable rate mortgage products continue to make the most sense in this environment, and we are seeing some more competion amongst lenders, with most at Prime + .60% (2.85%) now, and one at Prime + .40% (2.65%). If you or your client is in a variable currently, stay in it! If you are in a fixed, please touch base with us and have a review of whether it makes sense to move to a variable at this time as part of your mortgage strategy. If your client wants to make sure they have a low fixed rate held for their pre-approval, we should talk to them soon!
Sending your clients to Invis on the Peninsula will ensure they get the best strategy possible and makes you look good!
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Lending market update
With the change in credit markets we have seen a number of drastic changes over the last 6 months or so. This can have a dramatic impact on your clients, with changes to the major mortgage insurers having the greatest impact, such as Genworth & CMHC. Many of their programs are either gone or changed completely. What they will allow for debt service ratios, income verification, self employment verification and down payments are all being scrutinized more than ever.
Lenders themselves are all adjusting their rules as well, so it sometimes seems the changes to their policies are daily as to what is allowed and what is not.
If your client has been told by their Bank that they are "preapproved" it may not mean much more than the Bank would like to work with them, but will check everything later. We review our preapprovals on a per deal basis, and on those that are on the edge or in a gray area, we submit everything ahead of time to ensure you don't get suprised come subject removal time.
Knowing this side of the market is a key aspect of why dealing with us increases your chances of having your deal go through.
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Useful website for Your clients
Apart from our own website www.lloydonline.com (which is currently being reno'd, watch for changes soon!) here are some helpful links to provide to your clients who are looking for more information on mortgages.
If you need more specific information, please let us know! |
