Mortgage rates are LOW!

[ashedfc]

Information published today morning- by David Rosenberg's, Chief Economist

MOST CANADIANS STILL LIVING LIKE IT’S A RECESSION
According to Statistics Canada, Canada’s recession was short-lived,
beginnning in Q3 2008 and ending a year later in Q3 2009. But why doesn’t it
feel like that for nearly 60% of Canadians?
According to the Canadian Payroll Association, 59% of Canadians are living
paycheque-to-paycheque and report they would be in trouble if their
paycheques were delayed by a week. This is the same number of people that
said they were stretched last year when this poll was conducted (and the
economy was in a recession).
Canada’s recession may
have been short-lived, but
why doesn’t it feel that way
for nearly 60% of Canadians?
---------------------------------
We are 3 quarters out of the recession, & this is what we get. Just imagine if the double dip (or next recession) arrives, what can happen ???????????

[ashedfc]

Really love this one - guys, please do through this.

http://acrossthestreetnet.wordpress....ating-america/

[pbieganski]

Here is my rate.

I have two banks fighting for my business TD and Royal

<TABLE border=0 cellSpacing=2 cellPadding=0 width="100%"><TBODY><TR><TD class=fieldLabel>Interest Rate:</TD><TD class=bodyText align=left>2.75% </TD></TR></TBODY></TABLE>Interest Rate: 2.75% as of Sept 27, 2010

I like almost free money especially when I have the following GIC
CANADIAN TIRE BANK GIC - ANNUAL COMPOUND DUE 09/25/2013 INT 4.650 %

simple math time
CDN tire pays me 4.65%
I pay the bank 2.75%
remaining 1.9% goes to me...
Oh no I am a capitalist pig.. OINK...

[ashedfc]

By 25th Sept 2013, canadian dollar would have devalued much more than your gain (as the fiat currency devaluation is going in full speed, everyone is following QE, its like a race to the bottom, everyone is trying to devalue their currency, to increase exports).
You interest gain is taxable - you get a T-slip, & report it as 100% taxable (unless its a registered account, where there are different kind of tax implications)
The interest what you pay, goes from after tax money (net after tax income), which makes it more magnified when you add the tax portion.

Depending on your marginal tax rate : 2.75% & 4.65% (both might work out to be the same)

[pencorjan]

My mortgage is coming up for renewal within the next 90 days and I'll be going to my BMO rep to see if I should renew or look elsewhere. Seems like the common rate for a 5 year fixed term is 3.99%...anyone got any interesting deals or tips for negotiation that they would like to share? I'm wondering about the CIBC Aeromove mortgage since I'd like my payments to get me some kind of reward back.

[Zonny]

My mortgage is coming up for renewal within the next 90 days and I'll be going to my BMO rep to see if I should renew or look elsewhere. Seems like the common rate for a 5 year fixed term is 3.99%...anyone got any interesting deals or tips for negotiation that they would like to share? I'm wondering about the CIBC Aeromove mortgage since I'd like my payments to get me some kind of reward back.

I'm sure the words have been said in this thread somewhere, but MORTGAGE BROKER. Our broker got us a much better rate the last two times than our home bank would ever give us. Right now we're on a variable rate mortgage that's linked to prime, and our rate is about 2.5% I think it is (just went up to that recently).

Z

[chelle_n]

I like how we handled the refinancing of our mortgage when we refinanced this year. Locked it in at 3.5 for 5 years. But also got a LOC (at par) that ties to the mortgage.... as we pay down the mortgage our line of credit rises. We have used the LOC once... to pay of a CC bill @ 18% interest. We have already paid of the LOC, it was so much easier to do at par then at 18% interest. And out LOC is available if an emergancy came up.

I HATE debt... we only have our mortgage and 1 car payment now, and since I was laid off it is easier to live on hubby's income with almost no debt!

[ashedfc]

I like how we handled the refinancing of our mortgage when we refinanced this year. Locked it in at 3.5 for 5 years. But also got a LOC (at par) that ties to the mortgage.... as we pay down the mortgage our line of credit rises. We have used the LOC once... to pay of a CC bill @ 18% interest. We have already paid of the LOC, it was so much easier to do at par then at 18% interest. And out LOC is available if an emergancy came up.

I HATE debt... we only have our mortgage and 1 car payment now, and since I was laid off it is easier to live on hubby's income with almost no debt!

Excellent, Congratulations !!
You have done the best possible structuring of your mortgage.
This way, you will never have to pay a higher interest of 18.99% or more at credit card, or any other high interest debt. because you can take advantage of the low interest LOC to pay all other outstanding debt.
Make sure, you pay the LOC as soon as you can, so its available for future use when times get tough. Lot of homeowners get addicted to LOC & end up using it completely, which does not solve the purpose.
The LOC will protect you from going into higher debt interest burden, but the debt still need to be paid. This only reduces the interest - but you still have to pay the debt.

[chelle_n]

Line of credit has already been paid off, since more of the payments went to the debt and not the interest.

[brunt]

I like how we handled the refinancing of our mortgage when we refinanced this year. Locked it in at 3.5 for 5 years. But also got a LOC (at par) that ties to the mortgage.... as we pay down the mortgage our line of credit rises. We have used the LOC once... to pay of a CC bill @ 18% interest. We have already paid of the LOC, it was so much easier to do at par then at 18% interest. And out LOC is available if an emergancy came up.

I HATE debt... we only have our mortgage and 1 car payment now, and since I was laid off it is easier to live on hubby's income with almost no debt!

Your thoughts are similar to my own.

Too many people view low rate loans as "no problem". At best, they are just a smaller problem.

Getting rid of all debt 12 years ago was one of the first two steps that I made to becoming financially independent.

Debt is far too easy to take on and far too difficult to pay down in the best of times. Add in a problem or ten, and paying it off becomes impossible.

There was a time not so long ago where everyone knew that debt was a bad thing in which to enter. Seems that common sense is not so common any more.

[Zonny]

One of the things I am SO against, is the credit opportunities that are offered to college students. I did it, got offered a credit card when I could ill afford it and took it on.

At first I said I'd just use it for emergencies. But 'emergencies' turned into 'I need groceries and beer' and before long I had a big debt.

My DH is a saver, hates all debt and has never had any. When we got married he paid off my debt (and he did it again a few years later - yes, my DH rocks! But I can be taught ).

I've since learned to live within our means. We use our credit card for nearly everything to earn points, but it's paid off in full each month. We are car-free which saves huge amounts of cash, so we have a fair bit of disposable income. So I can buy most things I want, but we still have zero debt.

I always wonder how people do it, have a car (or two), go on vacations down south every year, buy things like there's no tomorrow. But we do OK financially, and we're far from doing all that!

Z

[Cheap]

I think that being car free is good if a person lives near a town where they can walk to get groceries and go to school. But if a person lives way out in the country...then they might not have access to bus service and even then it can be a long bus ride if you forget to buy milk.

[Zonny]

Yes, we planned it that way though. When we decided we weren't going to have a car, we bought our house in an area with several major bus routes.

[MortgageQueen]

Hi all,
I also recomend strongly considering the deep discount 5 yr. rates right now. In the past, I usually have advised my clients to go with a variable rate (which with a broker you can get prime minus. . .) however depending on your individual financial situation, locking in to 5 year rate right now can be wise. . . only because the variable rates are slowly climbing. . .but the 5 year rates have been dropping.

I notice a few SC'ers have locked in at very good rates this past 6 months. Good for you!

One other option you could conseder too. . if your debt level is pretty tight. The 10 yr. rate is sitting at around 5%. If you consider the fact that we'll probably be at 5% soon enough ( for our 5 yr. rates) you can double the length of a reasonably desirable rate. Again, this type of mortgage is for people that really depend on stability in their mortg. payment.

[pankaj]

Just take care not to get carried away like the Americans did and take out a larger loan for things that you want just because the rate is low.