#Second mortgage with bad credit Ottawa | Explore Tumblr Posts and Blogs

profbruce · 6 years

Text

How to save money?

Here’re a few tips on how to save money from the Financial Diet, https://youtu.be/G6l5GWYE9fQ:

1. cash cleanse—pay only using cash (wherever you can)

2. BUY IN BULK and use coupons/take advantage of deals

3. treat yourself occasionally but don’t overspend due to stress, excitement or sadness

4. rack up points but only if you can pay off your credit cards every month

5. take advantage of loyalty cards

6. rethink your commute—mainly cars—live with one less car or take public transit

7. use an app like gas buddy to find cheaper petrol

8. organize a carpool

9. take the second-hand challenge—get half your furniture, flatware and other stuff like appliances 2nd hand 😊

10. enroll in rewards and loyalty programs

11. buy less stuff

12. get cash back credit cards

13. link your credit cards to your checking account so you can’t spend more than you have in your account

14. use gift cards that you buy at a discount and use them to reward yourself for reaching your saving goal—this is your release valve!

Chelsea, the Financial Diet

Brucie’s q-ways to save?

a) freeze your credit cards in a bowl of water—it’ll take many hours to unfreeze during which you think better of spending on useless stuff you don’t need

b) if you buy something, you only do so by first removing something from your house or apartment (this courtesy of Jennifer Schweers)

c) get a roommate to share rent or help you pay your mortgage

d) buy a smaller house or rent a smaller apartment or buy a bigger home (with, say, a basement apartment) or rent a bigger apartment but get tenants, roommates or subtenants to help pay the mortgage or rent

e) put an extra room on Airbnb or Vrbo (this is not strictly saving money—it’s making more 😊)

f) cancel cable TV

g) get rid of landlines or get a Magic Jack phone (about $2.50 a month)

h) buy a house or condo—every month you pay off your mortgage, you are paying off part of the principal owing to the lender—it’s a form of forced savings

i) form a family savings plan or a circle of friends’ savings plan—where you match each other’s monthly savings and no one can spend without the approval of 2/3 of the group

j) form a trust of two people whereby you control via a trust the savings of another person and vice versa

k) have a set amount set aside from each paycheck or bonus (10% is good)

l) create a monthly budget and track your expenses and revenues

m) save your loose change

n) eat-in, cook more, go out less, drink less too

o) use term insurance instead of life insurance

p) create a personal balance sheet showing all your assets and liabilities—get rid of bad forms of debt (like credit cards) and focus on good debt (secured debt like mortgages)

q) create both a NEWPIN, new era financial plan for yourself and your family

Bruce M Firestone, B Eng (civil), M Eng-Sci, PhD

Real Estate Investment and Business coach

Century 21 Explorer Realty Inc broker

Ottawa Senators founder

1-613-762-8884

[email protected]

twitter.com/ProfBruce

profbruce.tumblr.com/archive

brucemfirestone.com

MAKING IMPOSSIBLE POSSIBLE

FREEDOM VIA REAL ESTATE INVESTMENT AND PB4L, PERSONAL BUSINESS FOR LIFE

FEHAJ, FOR EVERY HOME A JOB

#ways to save money

0 notes

yes-albert-blog · 5 years

Link

Matrixmg researched and ranked the best mortgage refinance lenders and debt consolidation home mortgage loan using a range of criteria, including interest rates and fees, customer. The best candidates for refinancing have regular income, at least 10 to 20 percent equity ... which are available through banks, credit unions, and other lenders.

#debt consolidation home mortgage loan #Debt Consolidation into Mortgages #Home Equity Loans Ottawa #best refinance lenders #second mortgage lenders in Toronto #mortgage lenders for bad credit Toronto #mortgage lenders specializing in self-employed #best first time home buyer mortgage programs #borrowing money on mortgage for home improvements

0 notes

arizonacreditrepair · 5 years

Text

Ottawa Way Street, San Antonio, Texas Credit Repair | (888) 502-1260

Ottawa Way Street, San Antonio, Texas Free Credit Repair Counseling call (888) 502-1260 remove bankruptcy, free consumer report, fix bad credit, check your annual Equifax, TransUnion, Experian credit report.

Call Ottawa Way Street, San Antonio, Texas credit repair (888) 502-1260 to see how we really actually work. Why is it so common to hear that bad credit can’t be repaired? What does the law say about repairing your credit? What is the truth about credit repair companies? Can they really do what they say they can do? How do you go about completely repairing your credit and getting new credit lines, mortgages, etc.? Can you add good credit to your credit report by having another person add you as an authorized user to one of their credit cards? Why is it so common to hear that bad credit can’t be repaired?

Credit is a way of life in Ottawa Way Street, San Antonio, Texas. Without good credit, you have to take your seat in the second-class section of our economy. But, if your credit is in shambles, you may not be willing to wait for seven years while your credit report repairs itself.

Is there anything you can do to speed your credit repair? Many authorities, such as the news media, will tell you there is nothing you can do to repair your credit. Newspapers, magazines, and TV news journals all seem to be unanimous in discouraging you from making any effort to repair your credit before the seven year limit.

https://www.youtube.com/watch?v=V9CC0jfYMKk

https://youtu.be/cbkqhyE1Mmk

youtube

https://www.youtube.com/channel/UC0enuJ9p-wpRXna_6sakc8A/about

https://www.youtube.com/channel/UCxwtLxS0Pm-rOdKD7WAnmuA/about

https://youtu.be/cbkqhyE1Mmk

youtube

from Ottawa Way Street, San Antonio, Texas Credit Repair | (888) 502-1260 via Ottawa Way Street, San Antonio, Texas Credit Repair | (888) 502-1260 September 25, 2019 at 05:08AM Copyright © September 25, 2019 at 05:08AM

#Ottawa Way Street #San Antonio #Texas Credit Repair | (888) 502-1260

0 notes

katsubara1984 · 5 years

Text

Pleasant Avenue NW Albuquerque, New Mexico Credit Repair | (888) 502-1260

Pleasant Avenue NW Albuquerque, New Mexico Free Credit Repair Counseling call (888) 502-1260 remove bankruptcy, free consumer report, fix bad credit, check your annual Equifax, TransUnion, Experian credit report.

Call Pleasant Avenue NW Albuquerque, New Mexico credit repair (888) 502-1260 to see how we really actually work. Why is it so common to hear that bad credit can’t be repaired? What does the law say about repairing your credit? What is the truth about credit repair companies? Can they really do what they say they can do? How do you go about completely repairing your credit and getting new credit lines, mortgages, etc.? Can you add good credit to your credit report by having another person add you as an authorized user to one of their credit cards? Why is it so common to hear that bad credit can’t be repaired?

Credit is a way of life in Pleasant Avenue NW Albuquerque, New Mexico. Without good credit, you have to take your seat in the second-class section of our economy. But, if your credit is in shambles, you may not be willing to wait for seven years while your credit report repairs itself.

https://creditrepaircalifornia.blogspot.com/p/ottawa-lake-michigan-credit-repair-888.html?m=1

https://youtu.be/nWhx0pm_Ws0

youtube

https://www.youtube.com/channel/UCHBt6t4vrTOhzJHkDtn_p1g/about

https://www.youtube.com/channel/UCFHXw6llKM-5zki_eaU4mpA/about

https://youtu.be/nWhx0pm_Ws0

youtube

from Pleasant Avenue NW Albuquerque, New Mexico Credit Repair | (888) 502-1260 via Pleasant Avenue NW Albuquerque, New Mexico Credit Repair | (888) 502-1260 August 28, 2019 at 02:51AM Copyright © August 28, 2019 at 02:51AM

#Pleasant Avenue NW Albuquerque #New Mexico Credit Repair | (888) 502-1260

0 notes

rebeccahpedersen · 6 years

Text

Scrap The Mortgage Stress Test: Yay Or Nay?

TorontoRealtyBlog

We briefly discussed this two weeks ago when I posted my angry rant about the Liberal government’s attempt to buy votes in the coming election.

One thing the government could do, to make housing more affordable, is eliminate, or alter, the mortgage stress test that was brought into effect in 2017.

Many of the readers suggested the mere presence of the test itself is useless, unnecessary, and/or unfair.

Others suggested that it’s a fantastic idea, especially in a climate of rising debt levels, and some went on to talk about abolishing the CMHC, which always comes up when we talk about anything debt-related.

There is so much to talk about today, I almost don’t know where to start. I’m going to share four articles with you, chronologically, which explain where this is all going, and where the “yay” and “nay” sides stand.

First, for those that don’t know – what is the mortgage stress test?

It’s an initiative from the Bank of Canada to promote financial responsibility among mortgage borrowers, effectively ensuring that all borrowers can afford higher payments at some point down the line. It’s a real-life “what-if” scenario being used in the qualification process.

The “test” portion of the term essentially comes from the fact that borrowers are all being tested against rates are 2% higher than prevailing rates, to see if they’d pass.

So if a 5-year, fixed rate mortgage is currently 3.29%, the Bank of Canada wants that borrower to be able to afford the same mortgage at 5.29%. The BOC wants the borrower to qualify, “pass the test,” and ultimately be safe in an environment of rising rates.

An optimist would argue that being financially responsible is never a bad thing, and since the government protects us from ourselves all the time, by making it illegal not to wear seat-belts in cars, they’re protecting us from ourselves when it comes to home-buying by ensuring we can afford to pay our mortgages if and when rates rise.

A pessimist would argue that it’s not up to the government to address how or when we save for the proverbial rainy-day, and that the stress test has the greatest impact on those who are already clinging to the bottom rung of the housing market. Foreign buyers, cash buyers, and high-end buyers are all unaffected.

In the end, I’m sure the votes will be split 50/50 on this one. My personal opinion is that a 1% stress test would bridge the gap between two arguments, both with merit.

Two weeks ago, this article appeared in the National Post:

“Canada Considers Applying Mortgage Tress Test Rules To Private Lenders, Sources Say”

From the article:

Canada is considering subjecting private lenders to the same mortgage stress test rules faced by banks to prevent housing markets from being destabilized by the lenders’ rapid growth, three sources with direct knowledge of the matter said.

Officials from the country’s finance ministry, financial regulator, central bank and federal housing agency have discussed whether the private lenders’ expansion over the past year poses a threat to economic stability, said the sources, who declined to be named because the talks are confidential.

Private lenders, usually groups of wealthy individuals, currently account for around one-tenth of Canada’s $1.5 trillion mortgage market, according to economists, and are still dwarfed by banks but their growth has accelerated since rules introduced by the country’s financial regulator last year made it harder for banks to grant loans.

There’s a few things to discuss here.

First, most of the alternative lenders are already using their own version of the stress test. They have higher rates, say, 4.79%, and they’re qualifying borrowers at 6.79%. Equitable Trust and Home Trust are two examples of where this stress test is already in effect. Granted, the alternative lenders use different qualification measures, ie. when it comes to commission-based income, stated income, etc.

Second, the credit unions are provincially regulated, not federally regulated, so perhaps this article and these “sources” are aimed at credit unions.

Lastly, the idea that the government can regulate how private individuals lend their money is ridiculous. If the owner of a $2,000,000 house, with no debt, wants to borrow $100,000, but has no job, and no income, would that home-owner have to qualify based on a mortgage stress test? We can debate the merits of this, and the Libertarians will probably end up on the other side of the argument of the folks who work at banks, and have their hands tied.

Earlier this week, the following article appeared in the Financial Post:

“More Debt Not The Answer: Watchdog Says Contentious Mortgage Stress Test Is Safety Buffer For Banks And Borrowers”

The sub-heading reads: “answer to the rising cost of housing cannot be more debt,” and that seems like a very reasonable conclusion.

But that won’t stop those who no longer qualify for mortgages from crying foul, and as we know, the cries are getting louder and louder.

From the article:

A federal banking regulator defended on Tuesday a stress test for uninsured mortgages that has been criticized for making it harder than it should be for some Canadians to own a home.

“The stress test is, quite simply, a safety buffer that ensures a borrower doesn’t stretch their borrowing capacity to its maximum, and leave no room to absorb unforeseen events,” said Carolyn Rogers, assistant superintendent at the Office of the Superintendent of Financial Institutions.

“This is simply prudent. It’s prudent for the bank and it’s prudent for the borrower.”

Later in the article, we see how politics is going play a role, whether simply as a measure to buy votes, or in terms of actual change:

“The government, through the stress test, changes to the mortgage rules, carbon taxes and higher daily costs of living, is suppressing the ability of people to meet the day-to-day needs and pay for their needs,” said Conservative MP Tom Kmiec in a speech in the House of Commons on Jan. 31.

The Mortgage Professionals of Canada also chimed in, with a quote that will surprise nobody:

“Our report illustrates that a more reasonable stress test level and lending restriction reforms are now needed to strike a better balance for borrowers and policymakers, improving housing affordability and Canada’s economy,” said Paul Taylor, president and CEO of the group, in a release.

And the day after this article was posted, the good ‘ole Toronto Real Estate Board, yes, everybody’s favourite, put their two cents into the bucket.

This article by the Canadian Press was picked up in multiple news outlets:

“Toronto Real Estate Board Calls On Ottawa To Revisit Mortgage Stress Test”

No kidding?

TREB is on the “nay” side of the stress test?

Well I’ll be damned!

And here I thought they were so busy agreeing to share sold data with their membership-paying agents who want to give better customer service to their clients, that they wouldn’t have time to back a horse in this particular race.

From the article:

Canada’s largest real estate board is calling on Ottawa to revisit whether a stricter mortgage stress test introduced last year is still needed, arguing that the policy has negatively impacted the economy and Toronto’s once red-hot housing market.

“While we saw buyers return to the market in the second half of 2018, we have to have an honest discussion on whether or not today’s homebuyers are being stress tested against rates that are realistic,” said John DiMichele, chief executive of the Toronto Real Estate Board (TREB) in a statement Wednesday.

“Home sales in the GTA, and Canada more broadly, play a huge role in economic growth, job creation and government revenues every year. Looking through this lens, policymakers need to be aware of unintended consequences the stress test could have on the housing market and broader economy.”

I will give John DiMichele credit for that one point – that rates might not be “realistic.”

I was the one who predicted at the start of 2019 that despite rumours of interest rate increases, not only did I think rates would fail to be increased, but that I think rates will decrease. So is a 5.79% interest rate realistic? We’re looking at a five year horizon, so it’s unreasonable to say “Not a chance.” But do I think we will see a 5-year, fixed rate mortgage of 5.79% in the next five years? No. I don’t.

Having said that, it looks suspect when the CEO of a real estate board comments on public policy that currently makes buying real estate less affordable. I don’t know why TREB even bothered.

But that’s what TREB does, right?

When they’re not busy making optimistic predictions about the real estate market, case in point…

“Toronto Area Home Prices Predicted To Rise 4 Per Cent This Year”

I love headlines like this.

Predicted?

Who predicted?

Oh. A bunch of real estate agents.

And last but not least, I give you today’s article in the Globe & Mail:

“Why Ottawa Must Rethink The Stress Test On Mortgage Switches”

At first glance, seeing that this article is by Rob McLister, who is the founder of Ratespy.com, and works in the mortgage industry, you might think the article is biased. I probably wouldn’t blame you.

But Mr. McLister is arguing a different point, that of mortgage renewals, and how the stress test applies to borrowers looking to renew a mortgage, but not to those who are renewing with a new lender.

This ends up “trapping” buyers with their existing lender, and who thinks that less choice in a free market is a good thing?

From the article:

The stress test, which requires federally regulated lenders to confirm you can afford a rate that’s at least two percentage points higher, does not apply if you simply renew your mortgage with your existing lender.

As a result, lenders industry-wide have enjoyed watching their customer retention rates climb. Last October, OSFI reported that renewals surged an unusual 30 per cent as of midyear while new mortgages were down 19 per cent.

As many as 100,000 renewers every year may be at risk of not passing the stress test, based on estimates from Mortgage Professionals Canada. And when a lender suspects you can’t qualify elsewhere, it has little incentive to offer you excellent renewal rates.

Worse yet, renewers who flunk the new stress test have no ability to switch to a lender with more favourable terms (such as lower penalties or more flexible refinance privileges). Better terms often save borrowers one to three times more than even a quarter-point interest rate difference.

“A stress test when switching lenders is purely anti-consumer,” says Ron Butler, a 23-year mortgage veteran of Butler Mortgage. “It’s an abuse of Canadian mortgage holders who deserve to shop for a better rate.”

Later in the article under the heading, “A Flaw In Logic” we read:

Renewing borrowers have already been stress tested. And they’ve already proven they can make all their mortgage payments on time. Exempting the current lender from the stress test, but not a competing lender (the one with the better rate and terms), is virtually nonsensical.

The renewing lender generally doesn’t re-underwrite the mortgage. So, it has less insight into how likely the customer is to pay going forward, versus a brand-new lender that fully reviews the borrower’s income, employment, credit report, property and other expenses.

“The borrower [who renews elsewhere] will be far better underwritten than at the incumbent lender who just fired off a renewal offer after checking for arrears,” Mr. Butler states.

You have to admit, this is a lot of attention on the stress test just in the past week, and I do think that changes are coming, like it or not.

We have a federal election this year, and as we have learned in every election in recent memory, it’s not about who you are as a party, it’s about what you can promise people – whether you follow through, or not.

I suspect both the Liberals and Conservatives will promise to make housing more affordable, and reducing the mortgage stress test is the low-hanging fruit…

The post Scrap The Mortgage Stress Test: Yay Or Nay? appeared first on Toronto Realty Blog.

Originated from http://bit.ly/2DiW2MF

0 notes

mikemortgage · 6 years

Text

Canada dodged the worst of the Financial Crisis, and it wasn’t just dumb luck

Tiff Macklem processed many emotions on Sept. 15, 2008, the day Lehman Brothers Holdings Inc. ended and one of history’s most severe financial crises began. One was relief.

Yes, relief.

Over the preceding six months, Macklem, who was the Finance official in charge of staying abreast of what was going on the world, had become consumed with dread.

In March, Bear Stearns, another famous Wall Street investment bank, had been rescued by the U.S. Federal Reserve. The official line in Washington was that the Bear situation was an isolated incident and the situation was under control. “Our financial institutions, our banks and investment banks are very strong,” Henry Paulson, the U.S. treasury secretary, said at the time. “I’m convinced that they’re going to come out this situation very strong.”

They weren’t convinced up in Ottawa.

What the Big Short’s Steve Eisman thinks of the financial crisis 10 years later

It’s been 10 years since the Financial Crisis. Are we going down the same path again?

‘The foundation of the capitalist system was crumbling beneath us’: Five lessons from the Financial Crisis

Macklem, along with the late Jim Flaherty who was then his boss at Finance, and Bank of Canada Governor Mark Carney were preparing for the Big One. But that’s not something the head of a major central bank, or one the highest ranking officials in the finance ministry of a Group of Seven country, could share with a lot of people.

They quietly encouraged Canada’s banks to get ready for a storm. They started work on contingency plans. And they learned to endure high levels of anxiety. Reflecting, Macklem struggled to find the words to describe what that was like. He eventually gave up trying.

Tiff Macklem in 2013.

“In some ways, the most difficult parts of the crisis were in between Bear and Lehman because you have this ominous feeling that it was going to get worse before it was going to get better,” Macklem told me in an interview on Sept. 12. “By this point, we had done the analysis,” he added. “We knew how vulnerable the system was. We knew there were other banks that looked like Bear. It wasn’t hard to imagine that it could get worse.

“Knowing it could get worse, but not knowing when or how or what it was going to look like? That was. That was. Yeah.”

There was a pained expression on Macklem’s face as he dug up those memories. We were in his office at the University of Toronto’s Rotman School of Business, where he has served as dean since 2014. Over my shoulder was a framed photograph of Macklem sitting next to Ben Bernanke, the former Fed chairman, at the meeting of G7 finance ministers and central bankers in Washington on Oct. 10, 2008 when the world’s most powerful countries promised to do whatever it took to stop the collapse of the global financial system.

Despite the bad memories, Macklem thinks it is important to fight crisis fatigue. Those who lived through it have a responsibility to make sure the next generation of bankers, executives, investors and policy makers understand the “enormous knot in our stomachs through that whole period,” he said.

There will be another recession, probably sooner than we think, given the current U.S. expansion is the second-longest on record. The Bank of Canada listed five big risks to its outlook in its latest quarterly forecast, and only one of them — stronger-than-expected U.S. growth — flicks at the possibility that things could turn out better than the country’s most sophisticated economic models predict. “The reality of this period of expansion is that interest rates have been very low for a very long time. Perhaps too long,” Victor Dodig, the chief executive of Canadian Imperial Bank of Commerce, said forebodingly in a speech on Sept. 11.

Macklem, who was in the running to replace Carney at the Bank of Canada, defended ultra-low interest rates as “necessary,” but acknowledged that the extreme levels of corporate, government and household debt that have piled up around the world were an “unintended consequence.” The central banks knew there would be some borrowing — that was the idea. Regulators in Canada and elsewhere have tried to dissuade borrowers from over-extending themselves, but it’s hard to push back against the allure of once-in-a-lifetime lending rates. Macklem is stunned the U.S. cut taxes and increased spending when the economy already was doing well.

U.S. Federal Reserve Chairman Ben Bernanke testifying about a bailout for the financial system on September 23, 2008.

“It’s time to be paying down debt, not running it up,” he said.

That’s about as specific as Macklem cares to get about what might cause the next crisis; economists are great at exposing vulnerabilities and terrible at predicting triggers, he said.

But what policy makers can do is prepare.

Canada had a “good crisis” because the banks were solvent, and because Macklem and others used those torturous months between Bear and Lehman to think clearly about what could go wrong and what could be done to mitigate the damage. Programs that appeared to come out of nowhere were actually weeks and months in the making. That required getting the right people in the right places and putting systems in place that allowed them to get past their cognitive biases.

“We have a tendency to see the world the way we would like it to be rather than the way it is,” Macklem said. “We can be slow to recognize the problems are deeper than perhaps we initially thought. What does that mean? It means we have to find ways for ourselves to imagine what could go wrong and we have to force ourselves to think, ‘If this breaks, what would we do?’”

It’s difficult to know if those conversations are being had in Ottawa. There are high-level committees that keep an eye on the financial system, but they don’t announce when they meet or reveal what they talk about.

Most of the men and women who fought the crisis in leadership positions for Canada have moved on. Hopefully those who are left haven’t forgotten the lessons of the Lehman collapse. We could need them to rise to the occasion again at any moment. There will be no excuses for not being ready.

• Email: [email protected] | Twitter: carmichaelkevin

from Financial Post https://ift.tt/2xiGupf via IFTTT Blogger Mortgage Tumblr Mortgage Evernote Mortgage Wordpress Mortgage href="https://www.diigo.com/user/gelsi11">Diigo Mortgage

#IFTTT #Financial Post

0 notes

mortbroker94124 · 7 years

Text

Price slump, tight cash wreak havoc in Canada’s top housing market

By Andrea Hopkins

OTTAWA — The sharp reversal in Toronto’s home prices has thrown Canada’s biggest property market into chaos, with scores of buyers suddenly short of money and desperate to get out of deals that looked good just a few months ago.

Much of that turmoil is not just down to those who bid at the peak and now wanted to get out of a deal, but also to lenders tightening credit and property appraisers lowering their valuations. Given how long the housing boom lasted, a retreat was hardly unexpected, but after a nearly decade of bidding wars and swift deals real estate agents, lawyers, lenders and mortgage brokers struggle to cope with the new reality.

“The big issue is with financing,” said John Pasalis, president of the Realosophy real estate brokerage in Toronto.

The first sign of a problem often comes when the lender sends out an appraiser, who judges the property is worth less than what the buyer offered a month or two earlier. A lower valuation means a smaller loan from the lender.

Pasalis gave an example of a buyer who expected a $1 million loan from the bank only to have it cut to $850,000 days before the deal was set to close.

“All of a sudden you have to come up with an extra 150 grand,” Pasalis said. He estimated that up to 5 per cent of deals were at risk now, something unheard of a year ago.

Toronto home prices are down nearly 19 per cent from the April peak and resales were about 40 per cent lower in July than a year earlier, according to the Toronto Real Estate Board data.

Two people with direct knowledge of the matter said that lenders had reduced their average valuation on properties by 12 to 15 per cent since March.

Property appraisers say that while they are the ones to break the bad news to buyers, it is the lenders that hire them who are getting more conservative.

“They have certainly tightened up their criteria,” said Dan Brewer, an appraiser and mortgage broker in Toronto’s Richmond Hill suburb and former president of the Appraisal Institute of Canada.

For example, lenders can require that the comparable sales used to help determine the value of the house be limited to a shorter period or smaller geographic area to ensure the appraisal reflects the cooling market, Brewer said.

As a mortgage broker he sees the impact of more risk-averse lenders, he said, with many more calls from buyers who need a second mortgage because the first one no longer covers their bid.

“I would say about 20 per cent of our files are now asking for secondary financing. That is a marked increase,” said Brewer.

Lawyers and alternative lenders

The market rapidly cooled in April after the government tightened rules and Home Capital Group Inc, Canada’s biggest non-bank lender, ran into liquidity troubles, spooking other lenders and causing a pullback in mortgage financing.

With buyers short of money and sellers desperate to close deals before home prices drop further, many turn to lawyers. Sellers want to sue those dragging their feet on an agreed purchase while buyers look for a way out of a contract without losing between $50,000 and $100,000 in deposits.

Real estate lawyer Bob Aaron said he discouraged clients on both sides from considering a lawsuit, which could takes years to resolve and cost $30,000 to $40,000 in legal fees.

Instead, he is trying to help work out some compromises with sellers either agreeing to give buyers more time to get the money, dropping their price or offering to help with financing.

“Some people want to walk away, some want half their deposit back, some bury their head in the sand and say ‘I’m not closing, if they want to sue, fine.'” said Aaron.

Realtors say re-listings have surged in recent months, but it is not clear how many follow deals that collapsed and how many are listings with adjusted, lower prices.

Buyers’ scramble for cash means brisk business for mortgage brokers and alternative lenders.

“What we have found recently is a whole bunch of aborted deals … and we’ve stepped in,” said Robert Goodall, chief executive of Atrium Mortgage Investment Corp.

Lenders like Atrium pool money from wealthy individuals to lend to borrowers unable to access cheaper bank credit.

Atrium offers buyers second mortgages and bridge loans at between 7.5 per cent and 8 per cent interest – double or triple the rate available for a first mortgage.

“It is actually really good business … these are good people with impeccable credit ratings, who just got caught,” said Goodall.

Mortgage brokers say they keep getting more requests for second mortgages, but Mortgage Professionals Canada Chief Economist Will Dunning said he was unaware of any reliable source that tracked the data.

Brewer said that most borrowers now managed to secure second mortgages from alternative lenders, but the higher costs and rising Bank of Canada official rates were bound to hurt the broader market at some point.

“There will be an impact in the Canadian banking world. It may simply be the second mortgage guy gets wiped out and the first takes less of a beating, but really the Canadian housing market would be at risk, there is no question in my mind.”

from DIYS http://ift.tt/2w4wkJc

#DIYS

0 notes

gillespialfredoe01806ld · 7 years