Canada’s dirty sub-prime secret

From this weekends Globe and Mail business section:

“I didn’t really have to show anything to borrow,” Mr. Goodyear said of his two remaining mortgages, both in default and totalling about $340,000. “I didn’t have to show them my tax returns. I just said ‘This is how much I make.’ I think I made 11,000 bucks.”

Mr. Goodyear is not alone. A Globe and Mail investigation into more than 10,000 foreclosure proceedings has uncovered a burgeoning subprime mortgage problem that many, including Prime Minister Stephen Harper, have insisted does not exist in Canada.

Read the full article here, as well as thier article on the related surge in foreclosure proceedings in BC and Alberta.

170 Comments
newest
oldest most voted
Inline Feedbacks
View all comments
Cristhian
Cristhian
11 years ago

Oh most Canadians don't understand how much the sub-prime problem exists here, it's that fact that it got so large in the U.S. that they couldn't hide it any longer. But with all the job loses in Canada now pretty soon the spot light will shift and we'll begin to see how many sub-prime problems there are in Canada. This is why S.Harper said at first that the economic action plan will help Canada emerge faster, and stronger from the recession, but then made a comment on how Canada will need the American consumer to start spending again. That's because they need Canadians to be employed again so that that people can take advantage of the action plan and renovate something instead of worrying how they're going to pay a mortgage that's way beyond their means.

ella
ella
11 years ago

"If you choose to live on your own and support yourself, fine."

Well, that fills in the remaining details.

"Fun argument though!"

Back at you, Rentah 😉

Raven
Raven
11 years ago

"jesus raven, have you ever heard the expression “doth protest too much”….?"

Indeed. This forum is one of the worst pity parties I've ever come across.

read on
read on
11 years ago

jesus raven, have you ever heard the expression "doth protest too much"….?

Vansanity
Vansanity
11 years ago

As an avid investor I caution you not to use stock index's as a gauge of the economy. Look at fundamentals, not trader's last bid or ask price.

It's mind boggling how little some people understand about investing.

Brittanny
Brittanny
11 years ago

First, the pundits spouted: "recovery in 2009".

Then "2010"

Recently, so far I have heard 2011,2012,2013.

Today I heard it will be 2014.

I suspect we may hear 2015 or 2016 by late fall or so.

Denialisrampant
Denialisrampant
11 years ago

Here is the full story of todays market action after the Fed intervention if your interested

http://www.marketwatch.com/news/story/fed-buy-tre

Denialisrampant
Denialisrampant
11 years ago

Supraboy:

#158 And the the SoupDrooler is an expert on the stock market LOL

Raven
Raven
11 years ago

Honestly, the only way to live comfortably in Vancouver in a 3-storey 3500 sqft house is bunk in with your family, share the living costs, and have a mortgage helper. PERIOD.

If you choose to live on your own and support yourself, fine. It's hard work getting ahead alone, but it can be done. I choose to live humbly with my family, with 6 working adults no dependents, and take advantage of the scales of economies my family has right now to build wealth. Real estate is an integral part of our portfolio.

If that's not your aspiration, fine. But don't spew hate and judgement just because I chose to do it. Furthermore, my RE investments in Edmonton does not impact you AT ALL.

Denialisrampant
Denialisrampant
11 years ago

I wanted to scoop this article off the Province esite before it dissapeared. http://www.theprovince.com/Business/Subprime+mess… I think this is another one of those under reported issues. It is the foreclosure stats that are slowly creeping up into the msm. Personally when my bank tried to offer me a big six figure HELOC I turned them down and told them not ot waste the space on my file. I would NEVER borrow that much consumer credit. But that doesn't mean a lot of other people didn't. Having access to hundreds of thousands of easy dollars without having to pick up a phone is just too seductive for many people. Of course the banks know this, but they're not social workers or a nanny are they. When house prices were rising a LOT of people took huge amounts of money out against "equity"… Read more »

Supraboy
Supraboy
11 years ago

Anyone see the stock markets lately? It keeps on rallying boys and girls. If that's not an indicator of "we've hit rock bottom", what is? This time next year, you'll see housing prices about 10-20% higher than what it's listed for now.

bubblegum
bubblegum
11 years ago

Raven, I am really concerned for you. You really ought to diversify.

I understand that John is looking to expand his pepperoni business to Alberta. The best part is, he has a whole fleet of SUVs, so you wouldn't have to take public transport anymore. Win-win!!

Raven
Raven
11 years ago

Whether it's 1) condo 2) townhouse 3) apartment, she still should have stuck to renting.

Raven
Raven
11 years ago

"” I still live at home with my parents and take public transit!”

What? Your story is quite confusing. I thought you were paying off your own house, not living at home?!

Oh, brother. I’m going back to work!"

To be exact, my parents live with me.

Renta
Renta
11 years ago

I said: "I feel bad for those that purchased a home to LIVE in and may well lose everything" "Perhaps some single mom working 2 shifts and still finding herself out on the street because she’s behind in the mortgage payements?.”

Raven said "Why in hell would a single mom working 2 shifts by a house? She should have stuck to renting."

A home could be a 1) condo 2) townhouse 3) apartment. And yes, you can get a mortgage on any of the above. I never once said a "house" did I?

Ok, ok ….Raven, you're killing me here! Too funny!

Raven
Raven
11 years ago

"Raven,

Congratulations for still living off your parents. Always a free ride for you. Perhaps if you had to live on your own, make your own rent payments and generally supported yourself like most adults, you wouldn’t be in this mess.

Again, I hope you get what you deserve."

Ha, then I'd be poor like you, right? I love my parents.

Raven
Raven
11 years ago

"You’re hoping to be released from the grip of one bubble before you miss the next one.

I believe you came on here with the intention of proving that lending standards are great in Canada. In the process you’ve revealed bits and pieces to provide an interesting bubble vignette.

I think it’s cool that you’ve paid off your main house, though. That’s the part of your story I do admire."

During a recession, who DOESN"T want to reduce their risk? In hindsight, of course I regret buying the condos! But now that the RE popped, I'm hoping Vancouver will become affordable again (that's why I'm a happy RE Vancouver bear) and if it does, I plan to sell off my edmonton properties to fund it.

Renta
Renta
11 years ago

Ella – Good call! you spotted the rat before I did. (Raven owns a house, but lives in a condo but wait…he/she lives with his/her parents)

I've got some journal entries to post…so I'm going back to work too.

Fun argument though!

Renta
Renta
11 years ago

Ella, I see your point and yes I agree. A glut of rentals coming on-board is good as long as the speculators don't try to jack up the cost of rent to cover their loses.

As for quality and size – again I agree. I've heard that any project built during a bubble – a condo/house whatever, isn't a good buy now nor in the future. The problems/crappy quality will only increase with repairs in the future. I don't know many families that would want to live in 400 sq ft. either.

Raven
Raven
11 years ago

"Raven – I resent YOU. A person that has 6 properties, will never live in any of them and probably won’t even step foot in any of them. Why did you buy so many?" Duh, I live in one of them. "I hope you get what you deserve. I feel bad for those that purchased a home to LIVE in and may well lose everything. Do you even think about that? Perhaps some single mom working 2 shifts and still finding herself out on the street because she’s behind in the mortgage payements?." Why in hell would a single mom working 2 shifts by a house? She should have stuck to renting. "Innicent people will suffer because people like you decided to bulk-buy properties, run the prices up and take affordibility along with it." People like me who provide properties… Read more »

ella
ella
11 years ago

" I still live at home with my parents and take public transit!"

What? Your story is quite confusing. I thought you were paying off your own house, not living at home?!

Oh, brother. I'm going back to work!

Renta
Renta
11 years ago

Raven,

Congratulations for still living off your parents. Always a free ride for you. Perhaps if you had to live on your own, make your own rent payments and generally supported yourself like most adults, you wouldn't be in this mess.

Again, I hope you get what you deserve.

ella
ella
11 years ago

"Raven – I resent YOU. A person that has 6 properties, will never live in any of them and probably won’t even step foot in any of them. Why did you buy so many?" I hear what you're saying. Flippers and speculators have caused all sorts of problems… BUT, as Raven him(?) self says, though, they are likely to sell at even, or a small profit, which means he and his family will really have to pay for any earnings on those (selling a property for a small profit after carrying it a while is a loss to the seller). In the meantime, they help increase the pool of rental housing. And that is a service. People, like Raven, who bulk-bought properties pave the way for future buyers. The run-up in Vancouver has created a ton of new properties, which… Read more »

Raven
Raven
11 years ago

"Raven: “I’m distracted by green arrow pointing up on the major stock indexes”

Are you too distracted to Google the term Sucker Rally?"

Stocks are already down 50%+ and P/E ratios are getting uder 10. Even if there's more downturn, so what. My loss will be minimal and the upside is incredible.

Raven
Raven
11 years ago

"Not dumb nor a bear but a “Speculator”. Someone that uses housing/shelter as a way to invest for their own greedy benefit to make money off the backs of hard-working families."

Greedy? Listen, I'm trying to make money and get ahead like the rest of hard-working families. I still live at home with my parents and take public transit! Before the downturn of this real estate, it was a great investment. And I still believe it is LONGTERM. So just stuff it.