Mortgage brokers warn about new rules

Canadian mortgage brokers are freaking out about new refinancing rules proposed by the OSFI which has taken over responsibility for the CMHC. Reasonably enough, they’re asking for clarification about proposals to require banks to check income and current house value before refinancing.

Currently, when mortgages come up for renewal, banks tend to focus on the borrower’s payment history. They rarely appraise the property again and not all banks will check the borrower’s updated income level, Mr. Murphy said.

“CAAMP strongly recommends that this concept be clarified so that mortgages continue to be renewed at maturity without requalification,” the industry association said in a submission to the Office of the Superintendent of Financial Institutions (OSFI).

“If not, homeowners who have been in compliance may no longer qualify. This would result in a number of properties hitting the market at the same time and thereby driving down prices.”

Such a phenomenon could add further fuel to a real estate downturn if lower house prices and higher unemployment caused more people to lose their homes upon renewal, Mr. Murphy suggested.

Read the full article in the Globe and Mail.

Sort by:   newest | oldest | most voted
Bull! Bull! Bull!
Guest
Bull! Bull! Bull!

@AG Sage: Thank you AG Sage, that is very useful information. I’m glad to see at least some people on this blog are on the ball.

patriotz
Member

@Anonymous:

“If things go bad in the future they are more likely to walk. ”
Why? Mortgages are full recourse in Canada

They are also full recourse in Florida and about 30 other US states.

Chabar
Guest
Chabar

Deadly HELOC:

The pair remortgaged their house to help raise about $100,000 for the expedition. They put off having children so she could take on Everest.

http://m.theglobeandmail.com/news/national/canadian-who-died-on-everest-had-been-preparing-for-summit-since-childhood/article2438959/?service=mobile

Anonymous
Guest
Anonymous

http://online.wsj.com/article/BT-CO-20120524-715405.html

TORONTO (Dow Jones)–With signs of Canada’s red-hot housing market slowing, further measures to tighten mortgage-lending standards aren’t necessary, the head of Canada’s second-largest bank said Thursday.

“At the moment, we see signs that the housing market is slowing, and the risk of a sharp correction is diminished,” said Toronto-Dominion Bank Chief Executive Edmund Clark.

We believe OSFI’s interventions will have a further dampening effect. As a result, we do not see a need at this time to tighten further,” Clark said. “We should wait to see how the markets evolve.”

jumpin in
Guest
jumpin in

http://www.bloomberg.com/news/2012-05-25/ferrari-deaths-fuel-anti-foreigner-anger-before-singapore-poll.html

“These rich foreigners have come in, and driven up our property prices, especially the Chinese,” said Sebastian Tan, a Singaporean salesman in the construction industry. “Just see how our property prices have shot up in the last few years since the government became so welcoming towards foreigners.”

asalvari1
Guest
asalvari1

@ZRH2YVR:

Re: your analysis and forecasting:

I have not seen EVER better made short term analysis. I don’t know who you are or what is your vocation (math heavy, I would guess), but this is beyond and above anything so far I have ever seen.

Thank you for sharing your views.

p.s. For Larry: Larry, this is how it should be done.

Arshes76
Guest
Arshes76

@Anonymous:

True (except for Alberta) but most people dont know that or dont think that if you cant keep paying your mortgage that the banks will come after them. The whole idea that they can’t get blood from a stone. If theres no money, then there nos money what can they do? But they do come after you and will, people in that situation dont believe it. Like people who wont check the mail or anser the phone when bills become too much. They just ingore. People r short sited thats why.

VanDweller
Member
VanDweller
Copied from PaulB’s number. Thank you PaulB. http://www.laurenandpaul.ca Using good-format’s format. Date List Price+- Sold Xpired Inv Inv+- S/L% 12.04.30 316 179 124 17530 75 39 12.05.01 354 144 179 583 17122 -408 51 12.05.02 371 131 150 100 17243 121 36 12.05.03 339 159 121 61 17400 157 36 12.05.04 337 120 77 68 17592 192 23 12.05.07 353 177 90 128 17727 135 25 12.05.08 365 157 183 86 17823 96 50 12.05.09 337 145 183 60 17917 94 54 12.05.10 318 129 115 47 18073 156 36 12.05.11 262 132 81 78 18176 103 31 12.05.14 268 168 150 112 18182 6 56 12.05.15 287 174 95 100 18274 92 33 12.05.16 271 185 204 141 18200 -74 75 12.05.17 270 127 70 94 18306 106 26 12.05.18 328 106 135 80 18419 113 41 12.05.22 381… Read more »
Loser with the girls
Guest
Loser with the girls

Jumpin in Says: ” Where is HAM?”

They are busy in China creating many hundreds of billions worth of unproductive debts, when the rest of the world is already saturated with debt and is relying on them to make up the funny-money difference. But this game is over.

jumpin in
Guest
jumpin in

Went to an open house today (Thursday!)
Beautiful, very luxurious, with all the high tech gismos one can think of.
On the market for only 30 days, but the price is already $100k down (5%).
Where is HAM?

Chabar
Guest
Chabar

@watson:

Ghosts and how to bust them in China:

http://www.bbc.co.uk/news/world-asia-china-18185873

market stats
Guest
market stats

Interesting that there must have been a lot of expirations or pulled listings today and recently. I assume sellers seeing a bad market and waiting for better days or at least for greece to finally throw in the towel.

paulb.
Guest
paulb.

New Listings 289
Price Changes 158
Sold Listings 149
TI:18667

http://www.laurenandpaul.ca

watson
Guest
watson

@specialfx3000: Huzbah sell tree, I sell tree, GHOSTS!

specialfx3000
Member
specialfx3000

@Anonymous:

Disappointed that none of the residents appeared on camera.

Maybe they’re too busy playing mahjong or talking to their Realtors to sell their units.

AG Sage
Member

@Bull! Bull! Bull!: Between May 2010 and Sept 2010 when the inventory fell, the five year interest rates also fell, from 4.75% to 3.8% That drove people into the market.
http://www.canequity.com/mortgage_rate_history.stm
Rates will not be falling this year.

Best place on meth
Member
Best place on meth

Ground has been broken on the hospice!

Wooooo!!!!

Anonymous
Guest
Anonymous

Gonna talk about the hospice at ubc on global news tonight.. Always fun:)

Nerdking
Guest
Nerdking

@chopper: For future reference you can format a link like this: first type

 

then paste the link in and close the tag with another > bracket. Then you type what you want the link to say, then close the tag with

 

.

Putting all together a link to this site would be typed out like this:

  link 

And when you post it will look like this:
link

space889
Member
space889

@M-: The crazy with 8 and 4s are started with HK and Taiwan immigrants who really believed in this stuff. The mainland Chinese didn’t really pick this stuff up until the last few years. 1996 is right during the big HK and Taiwan immigration waves.

chopper
Member
chopper

@Makaya: Ha! you’re awesome. Thanks Makaya!

Makaya
Member
Makaya
chopper
Member
chopper

http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/9263196/World-edges-closer-to-deflationary-slump-as-money-contracts-in-China.htm

If the link above does not work can someone please teach a retard like me how to do a link properly…

BTW, this is something to cheer up BPOM’s day

Boombust
Guest
Boombust

re:

http://www.realtor.ca/PropertyDetails.aspx?&PropertyId=11939783&PidKey=-542343134

I think that house has been done over by amateur flippers. They are starting to get spooked by the slowing market, having dropped the price $50K or so in the last two months.

It was re-listed recently as “NEW!”. Not.

Bull! Bull! Bull!
Guest
Bull! Bull! Bull!

@Anonymous:
>Nope, just a place to bitch about lounging RE agents with little to do but post crap on blogs.

If different points of view that are presented in a civil way aren’t tolerated, doesn’t this blog turn into the same mass media, developer/agent driven echo chamber that people have been complaining about for the last 7 years?