The Mortgage Market Analysis by Alberta Mortgage

Low Mortgage Rates Good For First Time Buyers

2011-08-23T12:38:00.000-07:00

On all the negative market news accumulated over the past month, Fixed Rate Mortgage interest rates have fallen by nearly one half of a percent. Considering that rates were already sitting nearing historic lows, this month's drop is creating an attractive opportunity for first time home buyers. With both interest rates and property values having dropped, buyers now have an opportunity to secure a mortgage with interest payments substantially lower than monthly rent for an equivalent --or even less than equivalent property.

For today's best rates, contact one of the qualified mortgage brokers at Alberta Mortgage at 780-479-2222 or Apply Online today.

Canadian Mortgage Bond Yeilds Jump --Possibly Resulting in Higher Fixed Mortgage Interest Rates

2011-07-04T12:09:00.000-07:00

Mortgage Bond Yields have moved upwards by 0.30% since Monday, June 27th, 2011. With that increase in mind, it is possible that we will see financial institutions across the Country raise Fixed Mortgage Interest rates in conjunction to offset the increased cost of the mortgage money they are lending out.
As of this morning(July 4th, 2011), we've already seen the Royal Bank increase its 5 year posted rate by 0.15%(15 basis points) from 5.39% to 5.54%(source: money.canoe.ca). While RBC's increase does not necessarily mean all lenders will follow suit, the possibility of an across the board increase does exist --it may be a good time to get a rate hold in place through a mortgage broker near you.

To get a mortgage rate hold, call one of the qualified mortgage brokers at Alberta Mortgage at 780-479-2222, or visit www.albertamortgagecentre.com today.

Fixed Mortgage Interest Rates Dropping

2011-06-08T15:39:00.002-07:00

Fixed Mortgage Interest rates have now fallen below where they were to start the year, and it appears that there may be further room to drop. With a slower than anticipated housing market, strong Canadian Dollar, low inflation, and dropping mortgage bond rates, mortgage lenders across the Country are competing for business --to the benefit of consumers.

Here are today's rates:

MortgageTerm Rate(%)
variable rate Prime - 0.80%
1 year closed 2.64
2 year closed 3.40
3 year closed 3.49
4 year closed 3.79
5 year closed 3.69
10 year closed 5.24

All rates are subject to qualification criteria and can change without notice. For up to date rates and product information, visit www.albertamortgagecentre.com, or call 780-479-2222 today.

Mortgage Update

2011-04-28T13:12:00.000-07:00

After a late surge in mortgage rates over the past few weeks, it appears that rates are again returning to early March levels. An increase in the Bond Market and strong expectations for the Spring Real Estate Market caused an increase of nearly 0.4% overnight 2 weeks ago from 3.89% to 4.29% for a five year fixed rate mortgage at many lenders. However, due to increased competition for a less than expected number of transactions rates began falling within days of the increase.

Today's Best Rates:

1 Year 2.64%
2 Year 3.40%
3 Year 3.50%
4 Year 3.79%
5 Year 4.04%
7 Year 5.04%
10 Year 5.24%
Variable 2.20% (Prime – 0.80%)

All rates are subject to qualification criteria and can change without notice. For up to date rates, or for more information visit www.albertamortgagecentre.com.

Fixed Rates Trending Downwards

2011-03-17T14:06:00.001-07:00

After an increase of over 0.4% earlier this year in five year fixed mortgage interest rates, fixed rates for nearly all term lengths are falling this week. At it's height, the five year fixed rate being offered by many lenders had gone all the way up to 4.19% just a few weeks ago. Now, with the surge in real estate, and mortgage activity easing as we close in on the March 19th, 2011 deadline for mortgages to offer 35 year amortizations and refinancing up to 90% --the market has again eased and rates have correspondingly dropped. As of today, here are the best rates available through Alberta Mortgage:

Term Rate %
variable rate Prime - 0.80%
1 year closed 2.64
2 year closed 3.20
3 year closed 3.35
4 year closed 3.79
5 year closed 3.84
10 year closed 4.99

As always, all these rates are subject to qualification criteria and can change without notice. To get the most up to date rates, call one of the qualified mortgage professionals at Alberta Mortgage, or visit www.albertamortgagecentre.com.

To find out more about how the changes to mortgages can/could affect you, call one of the qualified mortgage professionals at 780-479-2222.

Today's best rates:

2011-03-04T12:02:00.001-08:00

Mortgage Term Rate(%)
variable rate Prime - 0.80%
1 year closed 2.85
2 year closed 3.20
3 year closed 3.35
4 year closed 3.89
5 year closed 3.84
10 year closed 5.15

All rates are subject to qualification criteria and can change without notice. For up to date mortgage rates and information, visit www.albertamortgagecentre.com or call 780-479-2222 today.

Federal Government Announces Changes to Mortgage Qualification

2011-01-17T09:32:00.000-08:00

Finance Minister Jim Flaherty announced on Monday January 17, 2011 that the Federal Government will be making the following changes to mortgage lending rules:
• Reduce amortization of mortgages from 35 to 30 yearson insured mortgages;
• Maximum borrowing limit from 90% to 85% on refinances;
• No longer insuring Home Equity Lines of Credit.
The first of these changes are to become effective on March 18, 2011 for amortization and refinancing rules and the Home Equity Line of Credit to take effect on April 18, 2011.

To learn about how these changes will affect Canadian homeowners, call Alberta Mortgage at 780-479-2222 or visit www.albertamortgagecentre.com.

Alberta Mortgage's Weekly Rate Update

2011-01-14T12:41:00.000-08:00

For the most part, rates have held steady this week. Look for some movement in the coming weeks as market activity picks up.

Mortgage Term Rate

variable rate Prime - 0.80%
1 year closed 2.54
2 year closed 3.15
3 year closed 3.19
4 year closed 3.69
5 year closed 3.74

All rates are subject to qualification criteria and lender availability. Rates may change without notice.

For more information about mortgage rates, visit www.albertamortgagecentre.com today.

Home Purchasing Qualification

2010-09-24T11:02:00.000-07:00

Posted by Anuj Gupta

"Can I buy a home with no money down?"

The mortgage brokers here at Alberta Mortgage are often asked this question, and 100% of the time the answer we provide is: Maybe, let's take a look. While there is currently no such thing as "100% financing," Canadian Homebuyers do have the ability to get financing that allows for them to make no "out of pocket" contribution towards the down payment on their new home. This article will explore some of the items that we at Alberta Mortgage are looking at in determining if it would be possible for an individual to purchase a home without having a full 5% for down payment.

There are 3 primary factors that represent the minimum requirements for purchasing a home without a full 5% down payment:

1. excellent credit
2. verifiable income
3. money for closing costs (lawyer, inspection, etc)

While these 3 basic criteria are generally always evaluated in the process of determining one's ability to qualify for a mortgage, their importance becomes paramount for those looking to purchase a home without putting 5% down from their own resources. Without any one of these 3 criteria met, nearly all mortgage lenders will not be able to help. However, if these 3 factors are met, it is likely that one of the qualified mortgage professionals at Alberta Mortgage would be able assist a potential home buyer with purchasing a home without a down payment. Other factors are involved the qualification process, but these 3 provide a strong foundation for mortgage qualification. If any 1 or more of the 3 above listed criteria are not met, it may still be possible to arrange for home financing.

For more information regarding this program, or for information about mortgage qualification in general, call Alberta Mortgage at 780-479-2222 or visit www.albertamortgagecentre.com.

Prime Rises Again...

2010-09-14T09:31:00.001-07:00

Last week, the Bank of Canada(BoC) raised its key overnight lending rate by 0.25%, resulting in a corresponding increase to the Bank's Prime interest rate to 3.00%. For the Central Bank to have taken this action in the midst of continuing uncertainty, and ongoing fears of a double dip recession can be viewed as a sign that the Canadian Government is confident in the Canadian economy's ability to sustain it's momentum; but also can be viewed as a sign of the Central Bank's insistence for keeping to its schedule for the economic stimulus program.

For those with Variable Rate Mortgages, this is an important time to evaluate your situation and discuss the impact of a rising Prime on your mortgage with a licensed mortgage professional. Since most variable rate mortgages offered by Alberta Mortgage carry the option of converting to a fixed rate, now would be a good time to sit down with a broker and evaluate your options.

For more information about mortgage interest rates, or to discuss your situation, contact one of the qualified mortgage professionals at Alberta Mortgage at 780-479-2222 or visit www.albertamortgagecentre.com.

5 Year Fixed Mortgage Interest Rates Continue Slide

2010-08-24T09:40:00.000-07:00

Published by Anuj Gupta, AMP, BComm
Mortgage Associate

5 year fixed rate mortgage interest rates have continued their downward fall since late-July, now falling as low as 3.79%. I expect that increased appetite for mortgage loans in the fixed interest rate segment by Canadian Mortgage Lenders will lead to further reductions in rate.

At the same time, the Bank of Canada(BoC) reduced its mortgage qualification rate by another 0.1% this week; now down to 5.49%. With this move, more Canadians are able to qualify for variable rate mortgages, as well as qualify for fixed terms shorter than 5 years.

For more information regarding mortgage rates and qualification, contact one of the qualified mortgage professionals at Alberta Mortgage at 780-479-2222 or visit http://www.albertamortgagecentre.com.

Fixed rates continue slide

2010-08-04T16:38:00.001-07:00

5 year fixed rates have dropped again. As of today, potential and existing home owners in Canada can get a mortgage with a 5 year fixed mortgage interest rate as low at 3.89%.*

For more information regarding mortgage interest rates, or to get pre-qualified, contact one of the qualified mortgage professionals at Alberta Mortgage at 780-479-2222 or visit www.albertamortgagecentre.com.

BoC Increases Its Key Overnight Lending Rate by 0.25%

2010-07-21T09:41:00.001-07:00

The Bank of Canada has increased its key overnight lending rate by 0.25%, signaling a possible end to a period of record low interest rates in Canada. While no concrete evidence to suggest with certainty that the BoC will continue to raise interest rates each quarter, it appears that the Central Bank is confident in the Canadian economy's ability to absorb these increases --which is great news for everyone. While higher interest rates may not be welcome, the accompanying increase in economic activity and job creation are great signs of things to come. Were the BoC afraid that the economy was still too weak to carry an increase, it is likely that we would not have seen this move.

For more information regarding mortgage interest rates, or to get pre-qualified, please call one of the qualified mortgage professionals at Alberta Mortgage at 780-479-2222 or visit www.albertamortgagecentre.com.

BoC Drops Mortgage Qualifying Rate Once More

2010-07-13T12:15:00.001-07:00

Just 2 weeks after its last drop, the Bank of Canada has reduced its mortgage qualification rate once again by 0.10%. The mortgage qualification rate has now been reduced to 5.79% after reaching a high of 6.25% earlier this year.

For more information regarding mortgage rates and qualification, call one of the qualified mortgage professionals at Alberta Mortgage at 780-479-2222 or visit www.albertamortgagecentre.com.

BoC drops mortgage qualifying rate again

2010-07-06T08:46:00.000-07:00

This week, the Bank of Canada lowered its Bank of Canada Posted Interest Rate from 5.99% to 5.89%. This move can be interpreted as a signal of the Bank's lowering its forecast for rate hikes in the coming months or even years.

For more information regarding mortgages, mortgage interest rates or to get pre-qualified, call one of the qualified mortgage professionals at Alberta Mortgage at 780-479-2222 or Apply Online.

Mortgage Interest Rates Discussion

2010-05-29T19:31:00.001-07:00

It looks like mortgage interest rates are beginning to settle once again; with a drop of nearly 0.30% over the past 2 weeks in five year fixed rate mortgage interest rates --lessening the blow of the nearly 1% increase in early May, 2010. Today, existing and potential Canadian Homeowners can get a 5 year fixed rate mortgage with an interest rate as low as 4.35%, subject to qualification criteria.

Just 3 weeks ago, it appeared that we were finally on a path to returning to historical averages in mortgage interest rates --but the trend was unable to be sustained. With increased pressure from foreign markets, and a drop in real estate activity has resulted in precisely the drop indicated above. Normally, spring means higher fixed mortgage interest rates, however, this year that may not be the case. In the coming weeks and months, if market activity increases and other economic factors allow, Canadian mortgage lenders will likely again test the market's ability to tolerate a return to what would be considered historically "normal" fixed mortgage interest rates.

For more information about mortgage interest rates, call one of the qualified mortgage professionals at Alberta Mortgag e@ 780-479-2222 or visit http://www.albertamortgagecentre.com.

Federal Government Imposed Changes for Mortgage Qualification Take Effect

2010-04-19T15:46:00.001-07:00

As of today, April 19th, 2010, the following changes have officially come into play in connection with the announcement made by the Federal Government earlier this year:

1. Home owners will only be able to refinance their homes up to 90% of its value. As recently as last week, homeowners were able to refinance up to 95%, but now will only be able to take out up to 90% of the equity from their homes.

2. For any mortgage term shorter than 5 years, and for variable rate mortgages, consumers will need to qualify at the greater of new Bank of Canada Posted Mortgage Interest rate or the Contract Interest Rate. Last week, for terms shorter than 5 years, borrowers were able to qualify at the Contract Rate. This change makes a tremendous difference to buyers who were on the bubble.

3. Those looking to purchase rental/investment properties will now need to put a minimum of 20% down on the purchase of rental/investment properties.

For more information about how these changes would/could effect you, call one of the qualified mortgage professionals at Alberta Mortgage @ 780-479-2222, or visit www.albertamortgagecentre.com.

More Pressure on Fixed Rate Mortgages

2010-04-13T12:14:00.001-07:00

Just 1 week ago, the vast majority of prime mortgage lenders in Canada raised their fixed mortgage interest rates for 3-5 year closed term mortgages. It appears that rates are again set to be increased. Canada's largest bank, RBC has just issued a press release confirming that the bank will be increasing its fixed interest rates by an additional 0.25%, effective Wednesday April 14th. While it is unclear as to whether RBC's competitors will similarly increase their rates for the second time in 10 days --it is clear that financial institutions are looking to increase fixed mortgage interest rates.

If you are looking to be in the market for purchasing a home sometime within the next 3-4 months, it may be a good time to contact a mortgage broker and secure a rate hold --thus protecting yourself from further increases in rates.

For more information regarding interest rates, or to get prequalified, contact one of the qualified mortgage professionals at Alberta Mortgage @ 780-479-2222 or Apply Online @ http://www.albertamortgagecentre.com.

Variable Rates Continue Falling

2010-03-01T16:53:00.000-08:00

As expected, variable rate spreads have continued falling, now as low as Prime - 0.40%!*

This latest jump pushes totals to a difference in variable rates of over 1.40% in the past 8 months alone. If the trend continues --as I suspect, we could see variable rates falling back to 2008 levels (Prime - 0.90%) within the foreseeable future!

For more information regarding variable rate mortgages, and to get yourself pre-qualified, contact one of the qualified mortgage professionals of Alberta Mortgage @ 780-479-2222 or visit http://www.albertamortgagecentre.com today.

*subject to qualification criteria

Government of Canada tweaks rules on mortgage qualification

2010-02-18T11:21:00.000-08:00

Earlier this week, a few changes to mortgage qualification in Canada that would be implemented on April 19th, 2010 were announced by Finance Minister Jim Flaherty. These changes include an adjustment in the qualifying rate used in mortgage qualification, a reduction in the amount of equity Canadian Homeowners will be able to pull out of their homes, and an increase in the down payment requirement for those looking to purchase rental/revenue or investment properties.

Here's an explanation, and my take on these changes:

1. Borrowers will need to qualify using a 5-year fixed rate regardless
of what term they choose. If you want a 1.95% variable rate, for
example, you will need to show that you can afford payments at the
lender's 5 year rate. Since banks use their posted rates(normally at
least 1% higher than what you eventually get down to after
negotiating) to qualify potential borrowers, this change will have a
much greater effect on them as opposed to some of the lenders
available through mortgage brokers(who only have 1 fully discounted rate
available). While it has not yet been clarified as to whether ALL mortgage lenders will be required to use the same rate, my understanding is that each lender will be using their own posted bank rate.

2. No longer will you be able to refinance your home to 95% of it's
value. 90% will be the new refinance maximum. The bad thing about this
change is that homeowners will no longer be able to replace as much
high interest credit debt with relatively lower interest mortgage
debt. The good news is that upon sale, you will be more likely to have some equity left in the home.

3. People buying non-owner occupied rental properties will need to put
down 20% to get an insured mortgage, versus 5% previously. The idea
behind this move is to reduce speculative purchasing in the Canadian
Market, and provide more breathing room to investors in the event of market property value swings.

Keep in mind that these changes will only take effect on April 19th,
2010 --meaning buyers still do have a little time to get into a
home/refinance/buy an investment property before things change. One
thing of note however, is that most mortgage lenders in Canada are
likely to implement these changes BEFORE April 19th in order to ensure
that all files are being underwritten in accordance with the new
legislation on the effective date of change.

For more information regarding these changes, call one of the qualified mortgage professionals at Alberta Mortgage @ 780-479-2222 or visit www.albertamortgagecentre.com today.

Variable Rate Mortgage Spreads Expected to Get Better

2010-02-05T09:32:00.001-08:00

Posted by Anuj Gupta, AMP, BComm of Alberta Mortgage

In 2008, it appeared that Variable Rate Mortgages had changed forever. The consensus opinion among industry experts was that Canadian Home Owners would not see "Prime - " for a long time. The prediction was that it would at least be a few years before the market would even see variable rate mortgages @ Prime. However, with increased competition and returning stability it appears that Canadian Homeowners can expect a much sooner return to the days of deeply discounted Variable Rate Mortgages.

Shortly after the initial "market meltdown of 2008" in early 2009, many Canadian mortgage lending institutions either increased their variable rate spreads as high as Prime + 1.00%, or abandoned variable rate lending terms altogether. It appeared that things had changed forever. However, in the 3rd Quarter of 2009 we saw heavy competition in the Variable Rate Market return. Lenders began aggressively pricing their Variable Rate Mortgage Products, and have continued the trend. Presently, Variable Rate Mortgage terms have fallen to Prime - 0.30%*, and swing of 1.30% in 12 months!

As 2010 continues, I would expect to see this trend continue. Of course, anything can happen --but the market is indicating a return of deeply discounted variable rate mortgage terms.

For more information regarding variable rate mortgages, or to be prequalified call one of the qualified mortgage professionals at Alberta Mortgage @ 780-479-2222 or Apply Online @ http://www.albertamortgagecentre.com.

*subject to qualification criteria.

Mortgage Interest Rates Commentary

2010-01-27T08:57:00.001-08:00

Here’s a little commentary on interest rates I found that provides some insight into why I believe we will not see any dramatic increase in mortgage interest rates –in contrast to some of the stories I’m sure many of you have been hearing. It looks like we have good news for Variable Rate Mortgage holders, and those looking to get into the market:

“The annual inflation rate rose a less-than-expected 1.3 per cent in December, said Statistics Canada, and core inflation stayed at 1.5 per cent - a half a percentage point below the Bank of Canada's target rate.

In addition, consumer prices dropped last month.

"The way markets look at it is that because inflation remains subdued, it puts even less pressure on the Bank of Canada to raise interest rates and that softens the currency," Bank of Montreal chief economist Douglas Porter told The Canadian Press

. He added that business can't raise prices due to the weakness of the economy and the strength of the Canadian dollar has quashed import prices.
Bank of Canada governor Mark Carney will release the bank's next Monetary Policy Report Thursday.”

--source: mortgagebrokernews.ca

One thing to keep in mind about interest rates is the key difference between fixed and variable rates. Variable rate mortgages are set against the Bank of Canada’s Prime Lending Rate and are therefore directly connected to the Canadian Government’s monetary policy(ie. High inflation = increase interest rates). Therefore, you can expect to see variable rate mortgage holders remain happy with their mortgages for the foreseeable future. In contrast, fixed rate mortgages are priced based on the Canadian Mortgage Bond Market –meaning they are often subject to investor speculation and media reporting. This relationship is the reason why 2009 saw rapid increases and decreases throughout the year in fixed mortgage interest rates. I would expect we’ll see the same type of ups and downs for at least the first 2 quarters of 2010, but in my estimation the average rate should remain fairly stable.

What will we see this year? I expect to see interest rates rise slightly(0.25-0.50%) over the course of the year, but I will keep you all posted throughout. Let me know if you have any questions. For more information regarding mortgage interest rates, or to get your rate held call one of the qualified mortgage professionals at Alberta Mortgage at 780-479-2222 or Apply Online @ http://www.albertamortgagecentre.com today.

Regards,

Anuj Gupta, AMP, BComm

Mortgage Associate

Alberta Mortgage

780-479-2222 ext 14

www.albertamortgagecentre.com

When Results Matter

Fixed Rates Set to Rise

2010-01-07T11:17:00.001-08:00

After an up and down 2009, it looks like 2010 will be starting off with rising interest rates. With the economy appearing to have begun recovering, fixed mortgage interest rates are now expected to move upwards in an attempt to combat rising inflation. As interest rates rise and property values increase, it may become increasingly difficult for prospective home buyers to qualify for mortgage financing. It may be a good idea at this time to contact a qualified mortgage professional now and secure a mortgage rate if you are looking a purchasing a home sometime in the first quarter of 2010.

For more information about interest rates, and to secure a rate hold call one of the qualifed Mortgage Associates at Alberta Mortgage @ 780-479-2222 or visit http://www.albertamortgagecentre.com.

Fixed vs. Variable Rates: the debate

2009-12-11T09:08:00.001-08:00

Since late in 2008, the Canadian Mortgage Lending market has been experiencing a dramatic period of change. From fluctuations in interest rates to the emergence and disappearance of home financing products, the past 24 months have provided potential and existing home owners with a wide range of opportunities and challenges. Now, as the markets begin to settle, a new debate has emerged for the Canadian Home Owner: Fixed vs. Variable. Over the course of the coming weeks, we will discuss some of the potential benefits and challenges associated with both Fixed and Variable rate mortgages. We'll start of with Fixed Rate Mortgages.

5 year fixed rate mortgage have continued their downward trend through the first 2 weeks of December. Many are expecting to see even further decreases in rates over the course of the coming winter months, as buyer activity shrinks in the face of subzero temperatures, and a general post holidays slump in real estate activity. Fixed rate mortgage interest rates remain at or near historical average lows, and provide an excellent opportunity for existing and potential home owners to secure a great interest rate for the next 3 - 5 years. By taking advantage of a historically low mortgage interest rate, home owners can have peace of mind knowing that at least one component of their home ownership cost will be a constant for the near future.

However, while security is always great, variable rate mortgages are once again becoming increasingly attractive. As Canadian mortgage lenders become more confident in the market, and credit becomes more abundant, look for even more attractive Variable Rate Mortgage products to come out. In fact, over the past 12 months we've seen a tremendous shift in Variable Rate products --from Prime + 1.25% earlier this year, to now Prime - 0.25%! With Prime currently sitting at 2.25%, home owners can take advantage of as low as a 2.00% interest rate, and significantly increase their interest savings.

The debate will continue with next week's blog post, but for more information in the meantime call one of the qualified Mortgage Associates at Alberta Mortgage at 780-479-2222 or visit http://www.albertamortgagecentre.com.

5 Year Fixed Rates Falling --Closer to September Levels

2009-11-11T13:30:00.000-08:00

As predicted a few weeks ago, 5 year fixed mortgage interest rates have fallen. From a high of 4.39% in mid-October down to 3.99% today, the situation for home buyers is improving. We might not see rates fall much (if any) lower, but look out for a relatively long stretch of continuously low mortgage interest rates. For homeowners looking to take maximize their savings over the course of their mortgage term, a Variable Rate Mortgage may be the solution, as home owners will be able to take advantage of a historically low Prime interest rate for the time being, and then lock before rates go up.

For more information regarding mortgage interest rates and trends, contact one of the qualified mortgage professionals at Alberta Mortgage today @ 780-479-2222 or visit us online @ http://www.albertamortgagecentre.com.

"Prime -" Variable Rate Mortgages Are Back!

2009-10-07T14:15:00.001-07:00

This week, "Prime -" came back. Today, a few of our mortgage lenders announced the return of "Prime -" mortgage products in Canada. Existing and potential Canadian Homeowners can now get a 3 or 5 year Variable Rate mortgage at Prime - 0.10%!* Considering just 8 months ago we were looking at variable rates as high as Prime + 1.50%, the new rates are very welcome news.

To find out how much you could possibly save by switching to a new variable rate mortgage through Alberta Mortgage, call one of the qualified mortgage professionals at Alberta Mortgage today, or apply online.

*Subject to qualification criteria

Fixed Rates Continue Downward Trend

2009-09-18T15:07:00.000-07:00

Five Year Fixed Rate mortgage interest rates continue to fall this week down to 3.89%,* further increasing affordability for existing and prospective Canadian home owners. Similarly, recent downward pressure on the Variable Rate side has led to the resurrection of the "Prime -" mortgage.

As the Canadian economy continues to recover from the economic downturn, look for even more competition in the Variable Rate market, further increasing affordability for Variable Rate Mortgage holders. However, many are forecasting that a recovered market will also mean significantly higher fixed mortgage interest rates. For more information about interest rates, and to get pre-qualified, contact one of the qualified mortgage professionals at Alberta Mortgage at 780-479-2222 or Apply Online @ www.albertamortgagecentre.com
.

* subject to qualification criteria.

On New News, Variable Rates Looking Attractive

2009-09-02T10:57:00.001-07:00

Variable Rate Mortgages are looking more and more attractive. With a combination of the recent news that the prime rate will remain unchanged until at least the second quarter or 2010, and no reason to expect a dramatic rise through the year and the fact that Canadian mortgage lending institutions are once again competing for variable rate business, Variable Rate Mortgage holders are seeing significant savings. Considering that the same homeowner can see savings of over 1.5% on their mortgage interest rate between going with a variable rate over fixed rate mortgage today(a savings of $4,385.96 over a 12 month period!), the Variable Rate Mortgage is once again looking like a viable home financing alternative.

For more information about Variable Rate Mortgages, or to see what you could save, call one of the qualified mortgage professionals at Alberta Mortgage at 780-479-2222 or Apply Online at www.albertamortgagecentre.com.

BOC Sees Recession Turnaround in 3rd Quarter

2009-08-21T08:24:00.000-07:00

It looks like we have finally reached the promise land. After nearly 2 full years of a slowing economy, it appears that things have turned around. The Central Bank of Canada predicted that Canada would be heading out of the recession in the 3rd Quarter of 2009. The data is not out yet, but it is likely that the Bank will have forecasted correctly, as many of the current market indicators reflect a once again growing economy(visit my blog entry about market indicators here). Even with this news, the Bank remains prudent and has not yet raised its key interest rate from 0.25% --meaning variable rate mortgage holder are safe, for now.

For homeowners with existing Variable Rate Mortgages in place, this may be the time to convert to a Fixed Rate Mortgage –and prolong the one good part of the recession. As the economy recovers, fixed rates will continue their upward trend and the Prime rate is sure to rebound. For instance, in 2009 the 5 year fixed rate has gone from 4.99% to 3.29% to 4.09%* today. As the market recovers, expect to see higher five year fixed rates --as the market compensates for government cash infusions over the past 24 months.

For more information about interest rates, or to discuss the available options with a mortgage broker, call Anuj Gupta, AMP, BComm, Mortgage Associate with Alberta Mortgage @ 780-479-2222 ext 14 or visit http://www.albertamortgagecentre.com.

*subject to qualification criteria

Variable Rate Market Heating Up

2009-08-10T16:11:00.000-07:00

It looks like the Variable Rate Mortgage market is getting competitive. In mid-2007, Variable Rate Mortgages seemed like they could become a thing of the past. Products went from Prime - 0.9% to Prime + 1.50% within 1 week, and many lenders discontinued the programs altogether. But now, as the market has regained some confidence, competition has returned to the world of the Variable Rate Mortgage. Over the past 45 days, Variable Rate Mortgage products have fallen as low as Prime + 0.25%, and this morning, out came news that Canadian homeowners now have access to a Variable Rate Mortgage with an interest rate of Prime + 0.15%.

If the trend continues, it is possible that we will see an at-Prime Variable Rate Mortgage before the end of 2010 --and possibly even a return to the days of Prime -. But for now, I'll take whats on the table.

To learn more about Variable Rate Mortgages, call Anuj Gupta, AMP, BComm of Alberta Mortgage @ 780-479-2222 ext 14 or visit http://www.albertamortgagecentre.com today.

The "NO FEE REFINANCE": save between $1,000-$2,000 and still get the best rates!

2009-07-22T10:46:00.000-07:00

Canadian homeowners looking to use the equity trapped in their homes now have an excellent, cost effective option. Alberta Mortgage is proud to be able to offer the new "No Fee Refinance" mortgage product to Albertan home owners, which is a program specially designed to reduce the cost(s) of refinancing a home.

In particular, this new program has been designed to eliminate the cost of: a lawyer, an appraisal, transfer fees and title registration at the time of refinance, saving homeowners anywhere from $1,000.00-$2,000.00 at the time of refinancing their home. The best part about this program, is that borrowers still get the best available mortgage interest rates on any available mortgage term!

At a time when money is tight, Alberta Mortgage is proud to be able to offer home owners yet another money saving home financing solution. Take into account the fact that mortgage interest rates remain well below historical averages, and homeowners can be looking at significant savings by simply by replacing their existing home mortgages and securing a historically low mortgage interest rate for the next 5 years. In combination, a terrific interest rate and the "No Fee Refinance" could save you thousands. Take it a step further, and home owners can save even more.

By consolidating their consumer debt (credit cards, car loans, personal loans) into their mortgages, homeowners can maximize their savings. Learn more about debt consolidation mortgages here.

To learn more about this amazing money saving mortgage financing solution, contact one of the qualified mortgage professionals at Alberta Mortgage at 780-479-2222 or visit www.albertamortgagecentre.com today.

5 Year Fixed Rate Mortgage Interest Rates Fall...Slightly

2009-07-03T11:56:00.000-07:00

5 year fixed rate mortgage interest rates have fallen slightly after experiencing upward movement by as much as 0.6% over the previous 45 days.

As of today, 5 year fixed rate mortgages are available with an interest rate as low as 4.29%, subject to qualification criteria. We have also seen some downward movement in the variable rate products offered by many lenders, now available as low as Prime + 0.35% (2.60%), subject to qualification criteria.

For more information, call one of the qualified mortgage professionals at Alberta Mortgage @ 780-479-2222 or visit us online at www.albertamortgagecentre.com.

With the Market Recovery Just Around the Corner, Rates May Be on the Move

2009-06-26T10:29:00.001-07:00

Today, the Bank of Canada has announced that they will be reigning in some of their lending stimulus programs now that the economy appears to be recovering. Should part of this reigning in involve upward movement of the Bank's key overnight lending rate, which would meaning a higher Prime lending rate --home owners with Variable Rate Mortgages would see increases in their mortgage rates and payments.

Fixed rates still remain well below historical Canadian averages, however, Fixed Rate Mortgage interest rates have seen upward movement by as much as 0.5% since May, 2009. To learn more about interest rates, and see if now is possibly the right time to do something about your mortgage, contact one of the qualified mortgage professionals at Alberta Mortgage at 780-479-2222, or visit www.albertamortgagecentre.com.

Indications are that fixed rates may be on the rise...

2009-05-29T14:23:00.000-07:00

It appears that fixed mortgage interest rates may be getting ready to move again --but upwards this time. As discussed in a previous blog here, fixed mortgage interest rates are tied to the Canadian Bond market --as compared to variable rate mortgages, which move with the Bank of Canada's key overnight lending rate.

With recent recovery in the bond market and stronger than expected real estate activity, some lenders have already begun raising their five year fixed rates. If you were waiting for the bottom to refinance, it is possible that you missed it. Still, mortgage lending rates are well below historical averages and still offer a tremendous opportunity for existing home owners to reduce their living expense, and to help potential home owners qualify for the purchase of a home.

If you want to learn more about fixed mortgage interest rates, or would like to get pre-qualified or discuss the possibility of refinancing, call one of the qualified mortgage professionals at Alberta Mortgage at 780-479-2222 or visit www.albertamortgagecentre.com.

It looks like things might be getting ready to change

2009-05-08T12:36:00.001-07:00

It appears that things may be on the verge of changing in the world of fixed mortgage interest rates. Below is some information about bond rates in Canada and their effect on fixed mortgage interest rates.

• Canadian 5 yr bond yields + .07bps to 2.09 - Four weeks ago it was 1.86. The spread today vs the 5 year rate is now down to 1.67%.
• http://www.financialpost.com/markets/market-data/money-yields-can_us.html?tmp=yields-can_us NEW LINK

The yield, rate of return on your bond, can be read through a yield curve, which is the pattern of yields on bonds. This increase in bond yield is something to watch. If the bond yield continues to go up, the spread will continue to shrink and this could be a trigger for interest rates to rise!

For more information about interest rates, or to apply call one of the qualified mortgage professionals at Alberta Mortgage at 780-479-2222 or visit www.albertamortgagecentre.com.

Secure your interest rate today and enjoy peace of mind knowing you have one of the lowest mortgage interest rates in Canadian history

2009-05-04T14:09:00.000-07:00

Canadians can now get a 5 Year Fixed Rate Mortgage with an interest rate of 3.59%! For existing and potential homeowners looking to get a great rate on their mortgage, this may be the solution for you.

To learn more, get pre-approved, or get started --call one of the qualified mortgage professionals at Alberta Mortgage at 780-479-2222 or visit www.albertamortgagecentre.com/ today!.

*Subject to qualification criteria

Five Year Fixed Mortgage Interest Rates as low as 3.59%*

2009-04-28T17:26:00.000-07:00

Canadians can now get a 5 Year Fixed Rate Mortgage with an interest rate of 3.59%! For existing and potential homeowners looking to get a great rate on their mortgage, but who are not interested in making large lump sum payments or moving within the next 5 years this mortgage may be the solution for you.

To learn more, get pre-approved, or get started call one of the qualified mortgage professionals at Alberta Mortgage at 780-479-2222 or visit www.albertamortgagecentre.com today!.

*Subject to qualification criteria

Fixed Mortgage Interest Rate Fall...Again

2009-04-16T10:17:00.000-07:00

Just when it appeared that five year fixed mortgage interest rates had reached the bottom, rates have fallen again. As of April 15th, 2009 existing and potential Albertan homeowners can get a five year fixed mortgage with an interest rate as low as 3.69%, subject to qualifications.

If you want to find out how much you could possibly save be refinancing your existing mortgage, or to pre-qualify yourself for a mortgage call one of the qualified Edmonton mortgage professionals at Alberta Mortgage at 780-479-2222 or visit www.albertamortgagecentre.com.

Fixed Mortgage Interest Rates Continue to Fall

2009-04-03T13:24:00.000-07:00

Five year fixed mortgage interest rates have fallen again, creating even greater opportunity for prospective home buyers who were unable to afford home ownership in the past. the combination of existing real estate values and historically low fixed mortgage interest rates means home ownership is now much more affordable than it was over the past 3 years.

To find out if you qualify to purchase a home contact one of the qualified mortgage associates at Alberta Mortgage at 780-479-2222 or visit www.albertamortgagecentre.com.

Protect the Equity in Your Home

2009-03-31T09:16:00.000-07:00

With real estate values having declined by as much as 20%, some Albertan home owners are finding themselves carrying mortgages that are equal to and in some cases even larger then their property values. In this type of scenario it is very important for home owners to bring down the principal portion of their mortgage as fast as possible in order to create some equity in their homes in order to build a nest egg or even refinancing opportunities for the future. There are many strategies that home owners can use to quickly and effectively bring down the size of their mortgages. Below, we will outline a few simple strategies that can pay dividends for years to come.

1. Increase the frequency of your payments
When choosing a payment scheme, make accelerated bi-weekly payments in order to get a "free" principal reduction which would be equivalent to one full mortgage payment every year, painlessly.

2. As income rises, raise your mortgage payments.
While disposable income is fun to spend, putting it towards your mortgage will save you a lot of money in interest payments which will be even more fun to spend in the future.

3. Round your payments up, instead of down.
Over time, by making even extra nominal payments of $20 to the principal, the amount of interest that you will be saving yourself from will amaze you.

4. If mortgage rates fall, don't reduce you payment scheme
If so far, you the payment amount has not been an issue of concern, then there is no benefit in reducing the payment amount. However there is a downside to reducing your payment being that interest payments will grow.

By taking advantage of these easy to use options available in most mortgages (as well as some other simple strategies)arranged by the mortgage professionals at Alberta Mortgage, home owners can save themselves hundreds and even thousands of dollars in interest on their mortgages. In addition to these simple strategies, with the help of one of a qualified mortgage professional at Alberta Mortgage you can save tens of thousands of dollars in interest without making any significant changes to your existing spending patterns. To find out more, call one of the mortgage professionals at Alberta Mortgage at 780-479-2222, or visit www.albertamortgagecentre.com.

Fixed Mortgage Interest Rates Drop...Again

2009-03-24T12:20:00.000-07:00

For the first time in a very long time, 5 year Fixed Mortgage interest rates in Canada have fallen below 4.00%. Falling mortgage interest rates provide an excellent opportunity for home owners to reduce their monthly living expense and actually pay off their mortgages faster.

To find out if you qualify, call one of the qualified mortgage professionals at Alberta Mortgage @ 780-479-2222 or Apply Online at www.albertamortgagecentre.com.

Reducing Monthly Living Expense in Uncertain Times

2009-03-18T09:24:00.000-07:00

In an uncertain financial climate, all of us are looking for ways to cut our monthly expenses. One of the single largest monthly expenses for many Albertans is the cost of monthly mortgage payments. With the Global Recession now appearing to be deeper and more prolonged than previously forecasted, an opportunity to reduce monthly living expenses for many Albertans appears to now be on the horizon. Variable rate mortgages are currently sitting at historical lows, and coupled with 35 year amortizations --homeowners can see reductions in monthly mortgage payments of hundreds of dollars.

One question many homeowners have is "how long will the benefits of a variable rate mortgage last?" While lower payments today are great, many homeowners worry about the days ahead when the World Economy finally does recover and interest rates accordingly rise --meaning their monthly payment on their variable rate mortgage rises. One excellent feature of most Variable Rate Mortgages is that they allow for homeowners to convert their existing variable rate mortgage into a mortgage with a fixed mortgage interest rate at any time, at no cost.

While interest rates are low today take advantage of the tremendous savings potential offered in these markets, and converting into a fixed rate mortgage when you feel that the available interest rate is suitable.

to find out how much you could save by switching from a Fixed Rate Mortgage to a Variable Rate Mortgage, call one of the qualified mortgage professionals at Alberta Mortgage today @ 780-479-2222 or visit www.albertamortgagecentre.com.

Falling mortgage interest rates create opportunity for Albertan homeowners to lower their monthly mortgage payment expense

2009-03-13T14:17:00.000-07:00

While many sectors of the Albertan economy have been negatively impacted by lower oil prices and a relatively weakened Canadian economy, recent drops in Prime lending and Fixed mortgage interest rates have created an opportunity for Albertan homeowners to reduce their monthly mortgage payment expenses by refinancing their mortgage.
Many Albertans are starting to feel the effects of a slowing global economy at work, at home, and in their bank accounts. In these trying economic times, it is important for Albertans to look for ways to reduce expenditures. For many people, monthly mortgage/home equity line payments make up the single largest ongoing expenditure encountered. As homeowners face reduced working hours and even job loss, a reduction of even a few hundred dollars each month provides significant financial relief. With recent reductions in the Prime lending rate in Canada, as well as reductions in fixed mortgage interest rates opportunities have arisen for Albertan homeowners to significantly reduce their monthly mortgage expense while creating more equity in their homes.

For Albertan homeowners with at least 10% equity remaining in their homes, there is now a way to reduce monthly mortgage expenses while at the same time creating more equity in their home with each monthly payment. The concept is simple --with a lower mortgage interest rate mortgage payments are lower, and the interest portion of each payment made is smaller.

To learn more about ways to reduce mortgage expenses, or to learn more about the refinancing process, contact one of the qualified mortgage professionals in your area or visit http://www.albertamortgagecentre.com.

Pay off your debt faster without changing your lifestyle --is it just a myth?

2009-02-27T14:51:00.000-08:00

Becoming debt free has just become a little bit easier.

Alberta Mortgage is proud to now be able to offer a revolutionary debt elimination system for Albertans -home owning or not, that will help people eliminate their debt in as little as one third the scheduled time it would take to be debt free. If you have a mortgage, credit cards, student and vehicle loans, or any other form of personal debt, the mortgage associates at Alberta Mortgage can show you how you could possibly see a dramatic reduction in the amount of interest you pay on your debt without making any significant changes to your lifestyle.

To learn more about this product, and see how much you could save, contact one of the qualified mortgage associates at Alberta Mortgage at 780-479-2222, or visit www.albertamortgagecentre.com.

How do decreasing property values affect my mortgage?

2009-02-20T11:08:00.000-08:00

Property values all over Alberta have been steadily dropping since late 2007, and this change has had a dramatic impact on Albertan homeowners. In particular, with property values in some cases dropping by as much at 17%, homeowners who purchased homes with 0-5% down now owe more on their home than it is worth. As a result, they are no longer able to refinance their existing mortgage in full --meaning that they cannot take advantage of the lower fixed mortgage interest rates now available without first making a substantial prepayment on their mortgage.

To learn more about the affects of a declining market on your mortgage, call one of the qualified edmonton mortgage brokers at Alberta Mortgage at 780-479-2222, or visit www.albertamortgagecentre.com today.

If my mortgage currently carries a large prepayment penalty, is it worth refinancing?

2009-02-13T13:56:00.000-08:00

Fixed rate mortgage interest rates in Canada are currently at historical lows, meaning mortgage money is effectively cheaper than it had been at most any point in Canadian history. While the existing economic climate is not being welcomed by most Canadians --homeowners or not, the accompanying decreases in mortgage interest rates are certainly a welcome reprieve. Today, 3 year, fixed rate mortgages are available well below 4%, meaning that for any home owner who locked into a fixed rate mortgage at anytime in the past 4 years can potentially save thousands in interest and lower monthly payments over the course of their mortgage term.

Even after paying penalties, the benefits of replacing an existing mortgage with a new fixed rate mortgage can often far outweigh any associated costs. In particular, the greatest two benefits of refinancing to a lower mortgage interest rate are as follows;

A decrease in monthly payments, and therefore more discretionary income; and second, lowering the amount of interest that makes up each payment --meaning that at the end of your term, you will owe less on your home than you would with a higher rate mortgage!

To find out just how much you could possibly save, call one of the qualified Alberta mortgage professionals at Alberta Mortgage at 780-479-2222, Apply Online, or visit www.albertamortgagecentre.com.

Federal budget and home ownership

2009-01-27T15:18:00.000-08:00

Earlier today, federal Finance Minister Jim Flaherty tabled the federal budget. Several measures affect Canada's housing and mortgage industry.

• Temporary home renovations tax credit of up to $1,350 for eligible home renovations and alterations
• Increase in the home buyers RSP plan, withdrawal limit increased to $25,000 from the current $20,000
• A new first time home buyers tax credit that will provide up to $750 in tax relief for closing costs
• Broad based personal tax reductions including an increase in the personal exemption and increases to the limits for the two lowest tax brackets

Source: Canadian Association of Accredited Mortgage Professionals
www.caamp.org

The Credit Crunch & Your Mortgage: how to make the best of a complicated situation

2009-01-27T14:57:00.000-08:00

The global economy has cooled, credit markets have tightened, and it has been particularly cold here in Alberta --what a way to start 2009. While the headline stories may not be appealing, these challenging economic times have created a tremendous opportunity to homeowners looking to decrease their monthly expenses.

In response to the contraction of credit markets over the past 16 months, governments around the World have cut overnight lending rates to historic lows. Similarly, mortgage lending interest rates in Canada have dropped well below historical average lending rates. This new climate has created an opportunity for homeowners with existing mortgages to refinance, therefore, significantly lowering the cost of their mortgage.

For example, a $285,000 mortgage financed in late 2007 with an interest rate of 5.89% will have monthly payments of $1,804.86/month. If that same mortgage were replaced with a new mortgage for $285,000, total monthly payments would be $1,560.02 --a savings of $244.84/month. Over the remaining term of the mortgage, this homeowner will save over $10,000 in monthly mortgage payments!

To find out how much you could potentially save, call one of the qualified Alberta Mortgage Professionals at 780-479-2222, or apply online at www.albertamortgagecentre.com.

Do Fixed and Variable Rate Mortgages Move in Unicen?

2009-01-12T14:10:00.000-08:00

As we near the announcement of the Canadian Federal Budget next week, many potential and existing homeowners are expecting interest rates to drop --significantly. Accordingly, many people are similarly predicting mortgage interest rates to drop comfortably. While this prediction may come true, it is possible for the Bank of Canada to decrease its Prime Lending Rate without having any impact on Fixed Mortgage Interest Rates.

The reason a drop in the Bank's Prime Lending Rate does not necessarily equate to a drop in Canadian Mortgage Lenders' available Fixed Rate Mortgages is because the two are generally affected by a different set of factors, are designed to accomplish somewhat different objectives, and are controlled by an altogether different set of parties.

The Prime Lending Rate is a reflection of the Bank Canada's Overnight Lending Rate --which is the rate at which financial institutions are able to access short term funds. The Bank of Canada works with the Government of Canada to achieve targeted objectives set out by the Minister of Finance and Parliament. As a result of this relationship, the Prime Rate is often set in a way to maximize its positive effect(s) on the economy.

In contrast, Fixed Rate Mortgages are based on the Canadian Bond Market and therefore functions in response to market fluctuations and activity. As a result of this discrepancy between Fixed and Variable Rate Mortgage Interest Rates, it is possible for both to be moving in opposite directions --such as when the Government is looking to curb inflation while companies are seeking out capital investment.

For more information about Fixed and Variable Rate Mortgages, contact one of the qualified Alberta Mortgage Professionals or visit www.albertamortgagecentre.com or call 780-479-2222.

Debt Consolidation Mortgages: How do they work?

2009-01-02T13:56:00.000-08:00

What is debt consolidation?

Debt consolidation (in the context of a real estate) is when an individual converts their high interest, short term debt (credit cars, personal loans, unsecured loans, car loans, etc) into a lower cost loan in the form of a mortgage or secured line of credit. The money that is used to replace the high interest debt comes in the form of a loan registered against the borrower's property for the value its existing equity. Through debt consolidation, individuals can drastically reduce their monthly payments and overall cost of debt and simplify their lives by replacing a multitude of payments with a single monthly pre-authorized mortgage/interest payment.

Can anyone get a debt consolidation mortgage/line of credit?

Debt consolidation mortgages and lines of credit are only available to individuals who already own real estate, and have some established equity in the property. If you own your own home and have some existing equity, you can possibly qualify for a debt consolidation loan --regardless of your current credit situation. If you own a home, you can qualify!

How does a debt consolidation mortgage/line of credit really work?

Lets say that you as an individual have $312,000.00 in debt ($250,000 mortgage, $40,000 in car loans, and $22,000 in credit card debt), which has a total monthly payment of $2913.67

After consolidating the same debt with a new mortgage at even 5.75%, the same $312,000.00 of total debt would have a mortgage payment of $1950.07

By consolidating your debt in this example, you save $963.60 each month without making any changes to your lifestyle or spending patterns! If you were to set aside $500.00 of the $963.60 saved each month, by the end of your 5 year mortgage term, you will have saved $30,000.00 without making any spending cuts, and actually having an additional $463.60 to spend each month!

With these savings in hand, you can not only save money each month on payments, but you will also be protecting your credit rating, reduce your interest expenses and have the ability to better your lifestyle and save for the the future.

If you own your own home, these savings can become a reality!

For more information about debt consolidation and mortgage refinancing, call one of the mortgage brokers at Alberta Mortgage at 780-479-2222 or visit www.albertamortgagecentre.com

Fixed & Variable Rate Mortgages: Which way to go?

2008-12-17T09:34:00.000-08:00

With news of Central Banks around the World drastically slashing overnight bank lending rates, many people are beginning to wonder if a variable rate mortgage --while slightly more expensive today than in years past, would minimize their home ownership costs. In the short term, the answer is a resounding YES. With a Prime Lending rate below 4%, and expected to continue dropping mortgage payments for Variable Rate Mortgages will remain significantly lower than those of identical size Fixed Rate Mortgages. Even as Five Year Fixed Rate Mortgages have dropped by nearly 1 full percentage point since October and remain significantly below historical averages, many home owners are taking a serious look at the immediate savings of having a Variable Rate Mortgage. However, while tempting, Variable Rate Mortgages can bear significant risk for mortgage holders.

As economies around the World recover and respond to the heavy influx of capital from Central Banks and the resulting inflationary pressure, mortgage interest rates will rise. Considering the fact that tens of trillions of dollars are expected to be pumped into World markets in 2009, this rise in Prime Lending interest rates around the World could very offset any savings made by Variable Rate Mortgage holders. In accordance with the Prime Lending Rate, fixed mortgage rates will most likely feel similar upward pressure, and can be expected to rise even faster.

When considering the alternatives (variable rate or fixed) before you, it is important to examine your own financial capacity, as well as the importance of certainty in your own life. If you can comfortably afford a mortgage payment with a fixed rate, and are happy paying what is now a small premium for the security of knowing what your payments will be for 3 - 5 years then maybe a Fixed Rate Mortgage is right for you. However, if you feel that the immediate savings of a Variable Rate Mortgage are worthwhile, and are confident in your own ability to accurately time the best opportunity for locking in your rate, a Variable Rate Mortgage may be the solution for you.

For more information about Fixed and Variable Rate Mortgages, or to apply for a mortgage loan contact one of the Qualified Alberta Mortgage Professionals @ 780-479-2222 or visit www.albertamortgagecentre.com.

Stability and Competitivity --Returning to the Mortgage Market

2008-12-09T10:24:00.001-08:00

After over 12 months of instability, it appears that controlled chaos that defines the financing market has returned --or is at least starting to come back, in Canada.

Since late in 2007, mortgage lenders including banks, credit union and mortgage specific lenders have been feeling the pinch of what is now referred to as the 'Credit Crunch.' As money markets tightened, and investor confidence plummeted, mortgage lenders became increasingly hesitant to lend money. Mortgage products were pulled, interest rates moved up by almost 1 full percentage point, and a series of mortgage lenders closed their doors to new business. For a period of a few months, it almost seemed like mortgage lenders just didn't want to do business.

But all of a sudden, last week things changed. Lenders that had effectively shut their doors to new business (by pricing themselves out with high interest rates) are again competitively pricing their mortgage products, and re-introducing products discontinued over the past 18 months. An excellent indicator of the return of competition is the change in variable rate mortgage interest rates over the past 2 weeks.

After being discontinued in early 2008, and slowly coming back at Prime + 1, Variable Rate Mortgages are again becoming competitive. In the past two weeks, two lenders have dropped their rates on the Variable Rate Mortgage Product by nearly half of one percent, and more are expected to follow. This competition is a positive sign for the entire industry, as competition displays confidence --the result of some stability in otherwise economically challenged times.

For more information about the mortgage interest rates, call one of the qualified Alberta Mortgage Professionals @ 780-479-2222 or visit www.albertamortgagecentre.com.

Emerging Trends in the Mortgage Market

2008-12-01T14:06:00.000-08:00

Recent changes in global financial markets have had a series of impacts on many facets of the Canadian economy, including mortgage lending. An unstable financial context has seen changes in lending practices, interest rates, and credit availability. As investors face an increasingly uncertain market, they wish to have the flexibility to assess the risk of their borrowers at increasingly shorter intervals. Basically, investors are now looking to be able to get rid of "bad" mortgages as quickly as possible. As investors become vigilant in their investing practices, another pattern has emerged; a push in short term (1 year - 3 year) mortgages with attractive, low interest rates.

Currently, a series of mortgage lenders are offering 1 year mortgages at historically low interest rates, falling to more than 1% below available five year rates. Shorter term mortgages also offer benefits for borrowers who do not intend to remain in the same home for five years. Shorter terms often mean that the payout penalty will be lower, and allow for the borrower to refinance at shorter intervals without having to pay payout penalties. At the same time, shorter term mortgages carry significant risks.

In particular, shorter term mortgages can expose homeowners to unanticipated market shocks and force them to pay higher mortgage payments at renewal that often do not exist with longer term mortgages. The basic reason for this difference is that five years often represents a single market cycle. As a result, whether for good or bad, your mortgage interest rate will remain relatively stable --as investors, bond markets and other determining factors move through the eb and flows of the market. Longer term mortgages generally offer fairly attractive interest rates, as well as long term relative stability.

In contrast, shorter term mortgages often do not provide sufficient time for the markets to fully complete an economic cycle. As a result, mortgage borrowers can be subjected to drastic, short term interest rates. Shorter term mortgages can be beneficial for some borrowers, but for others, conventional five year mortgages can be more suitable.

To learn more about the differences between shorter and longer term mortgages, as well as to learn about which would suit you best call one of the qualified Alberta Mortgage Professionals at Alberta Mortgage at 780-479-2222, or visit www.albertamortgagecentre.com.

Tips for minimizing the cost of your mortgage in today's economy: (renewals)

2008-11-24T09:17:00.000-08:00

If your mortgage is coming up for renewal, there are a variety of strategies that you can and should employ in order to minimize the cost of your mortgage at the time of renewal. This article will provide you with a pair of simple strategies to employ at renewal time that will help you save money, and get a mortgage that will best meet your needs.

1. Learn about the available mortgage rates and products. Perhaps the most important thing to do at renewal time is also the simplest --shop around. Most Canadian Homeowners simply renew their mortgage with their current mortgage holder without first finding out what other rates or products are available to them. As a result, homeowners may end up with a higher interest rate, or with a mortgage product that does not provide options that will best meet their needs. When renewal time approaches, being educated it is just as important as it was when you first got your mortgage.

2. Assess your own financial and personal situation and determine whether this would be a good time to refinance, instead of simply renewing. Most Canadian homeowners have mortgages with closed terms because they generally offer lower interest rates. However, one drawback with closed mortgages is that they often have prepayment and payout penalties attached to them --meaning that when you refinance, sell your home or otherwise pay off your mortgage, you pay a fee. This means that when you want to take out equity from your home, you may have to pay these costs. However, at the time of renewal these penalties often do not apply. As a result, you save the cost of a payout penalty.

By using the strategies discussed above, you can save yourself money and get a mortgage product that will best meet your needs and satisfy your financial aspirations. To learn about more money saving mortgage strategies, consult a mortgage broker or visit www.albertamortgagecentre.com.

In the existing financial market, if my mortgage is coming up for renewal what should I do?

2008-10-31T09:43:00.000-07:00

The collapse of the financial markets around the World has and will continue to impact nearly every facet of Albertan life. Oil prices have eased, real estate activity has slowed, lending practices have changed, food prices are expected to drop, and many industry experts are even beginning to speak about the Credit Crunch’s impact on professional sports. Accordingly, homeowners who have paid their mortgages on time for the past 3 or 5 years and maintained an excellent credit history are not being left immune. Financial Institutions have experienced traumatic losses over the past 24 months, and it is becoming increasingly clear that their costs are going up. As a result, mortgage lending practices are changing, and interest rates are starting to move.

In today’s market homeowners must remain vigilante, and exercise their ability to minimize their home ownership costs –including the cost of their mortgage. The easiest way to ensure that Albertan homeowners get the best deal is to consult a qualified Alberta Mortgage Professional.

As a mortgage nears renewal, most financial institutions send out offer letters to their clients –indicating prevailing mortgage rates, and offer a series of mortgage terms. At this time, it is important for homeowners to shop around –the same way they did when they first got their mortgage. By taking an active role at the time of renewal, homeowners can take advantage of new products, deal with more suitable lenders, and get the best available mortgage interest rates.

For more information about changes occurring in the mortgage market or if your mortgage is coming up for renewal, contact one of the qualified Alberta Mortgage Professionals at Alberta Mortgage @ (780)479-2222 or visit www.albertamortgagecentre.com.

What is going on in the financial market, and how will the present situation affect the average existing/prospective mortgage holder?

2008-10-15T10:03:00.000-07:00

The financial world is a constantly evolving context, in which both economic factors and pure human emotion can enrich or impoverish the lives of millions. At present, the world financial markets are in a state of panic as the World's investors are extracting their funds from the marketplace, holding on to the denominator in which they trust --cash. As investors flea, money markets shrivel, and the financial world experiences the phenomenon we've all been hearing about: The Credit Crunch.

So what is the Credit Crunch?

When millions of investors extract their money from the market (over 2 trillion dollars), businesses become unable to secure funds for doing business. In the case of banks, investment firms, mortgage companies and the like, when they become unable to secure market funds for doing business, they are forced to search out investors who demand higher rates of return, and demand more oversight over the use of their funds. As the cost of funds increase for lenders, the costs of funds are passed along to borrowers. Increased costs, and more stringent guidelines mean less borrowers can qualify for loans and therefore less money goes into the market to again be borrowed and lent. As a result, credit continues to become more and more difficult to secure, and borrowing costs continue to go up until funds become available. Knowing this, central banks around the globe have made recent efforts, injecting what will end up being trillions ($24 billion and $700 billion in Canada and the United States alone, respectively) into the market and lowering prime lending rates in an effort to make lending money easier and cheaper once again.

What does all of this mean for the mortgage of the average prospective/existing homeowner?

As the availability of credit dries, fixed mortgage interest rates swell due to the increased cost(s) of lending. However, cash injections by central banks around the globe should help re-establish security in lending markets and hopefully limit further increases in fixed mortgage interest rates. Even with significant cash injections, I believe that fixed mortgage interest rates will continue to rise as lenders attempt to recoup 2007/2008 losses. In contrast, with prime lending rates dropping variable rates become increasingly affordable with one exception --most lenders are pausing, postponing, increasing or altogether eliminating variable rate mortgages from their product offering lineup. If you already have a variable rate mortgage at Prime - (0.00 to 0.90)% then I think you are safe, and will be enjoying what are and will be historically low mortgage interest rates as central banks continue to lower the Prime lending rate in attempt to bolster cash strapped economies. Those who have a variable rate mortgage should be in good shape --even while the road ahead may be full of bumps of anxiety. At the same time, many lenders are eliminating variable rate mortgages from their product line --therefore inhibiting many prospective/exisiting homeowners from taking advantage of potential Prime rate decreases in the near future.

Even with recent increases, fixed mortgage interest rates remain historically low. While fixed mortgage interest rates have increased by nearly 1% since August of 2008, they remain competitively priced, allowing for Canadians to comfortably afford the cost of credit. The market is still well capable of providing Canadians with the ability to afford owning real estate, and will continue to be among the leaders in the world financial marketplace in quality product offerings, consistency, and rate competition.

For more information about any of the above discussed mortgage topics contact one of the edmonton mortgage brokers at Alberta Mortgage @ (780)479-2222 or visit www.albertamortgagecentre.com.

Is Real Estate Still a Sound Investment in Alberta?

2008-10-09T10:55:00.000-07:00

Investing in real estate has long been a sound long term investment strategy. Historically, increases in property values have well outpaced inflation over the long term. In the short term (under 5 years), economic cycles, and speculative bidding often dictate growth and declines in real estate markets, and can therefore harm the growth potential of real estate for short term investors. However, in the long term real estate values consistently outpace inflationary pressures and increase in real value.

The Alberta Real Estate Market went through a cycle over the past half decade where increases in property values far outpaced inflation or growth –particularly in late 2006 and 2007 during which property values soared in double digit values month over month. The market is now making a correction and re-establishing the once lost balance between growth in property values and inflationary pressures. Once this correction has been completed, I would expect for property values to stabilize and then begin increasing (at normal levels) again. In the long run, I would expect the Alberta Real Estate Market to again lead the country in strength and growth and remain a sound investment.

For more information, or to discuss this topic please contact one of the mortgage professionals at Alberta Mortgage at 780-479-2222 or visit www.albertamortgagecentre.com.

How to pay off your mortgage faster without substantially altering your lifestyle

2008-10-02T08:10:00.000-07:00

Most Canadian homeowners know that the longer they hold on to borrowed money, the more it costs as interest accrues. Knowing this fact, most mortgagors (borrowers) try to pay down their mortgage as quickly as possible --thus maximizing their interest savings.

Most mortgages offered by the mortgage lending partners at Alberta Mortgage offer substantial payment privileges to borrowers, allowing for lump sum payments as well as ongoing principal reduction. However, for most homeowners making large lump sum payments can be difficult and therefore rarely occurs. Instead, by following some of the simple strategies outlined below Canadian homeowners have saved tens of thousands of dollars in interest over the life of their mortgages.

1. Increase the frequency of your payments:
When choosing a payment scheme, make accelerated bi-weekly payments in order to get a "free" principal reduction which would be equivalent to one full mortgage payment every year, painlessly.

2. As income rises, raise your mortgage payments:
While disposable income is fun to spend, putting it towards your mortgage will save you a lot of money in interest payments which will be even more fun to spend in the future.

3. Round your payments up, instead of down:
Over time, by making even extra nominal payments of $20 to the principal, the amount of interest that you will be saving yourself from will amaze you.

4. If mortgage rates fall, don't reduce you payment scheme:
If so far, the payment amount has not been an issue of concern, then there is no benefit in reducing the payment amount if/when your mortgage interest rate falls. However there is a downside to reducing your payment being that interest payments will grow.

For more ideas on paying off your mortgage faster, visit www.albertamortgagecentre.com/tips.html or talk to one of the qualified mortgage professionals at Alberta Mortgage.

Alberta Mortgage
#78, 4003 - 98 Street NW, Edmonton AB T6E 6M8
P: (780)479-2222
F: (780)471-5981
web: www.albertamortgagecentre.com

Welcome

2008-09-30T11:42:00.000-07:00

The Mortgage Market Analysis is your weekly source for commentary on the local Edmonton real estate, financial market and mortgage lending markets. Each week, one or more of the qualified Mortgage Associates at Alberta Mortgage will discuss a range of issues impacting Albertan Home Owners.

For more information, or to discuss any of the topics described here, contact one of the mortgage professionals at Alberta Mortgage at 780-479-2222 or visit www.albertamortgagecentre.com