Mortgage Rates to go up by week's end? . .

[NuCoupon]

Absolutely True,
The Current Housing Bubble is "EPIC" in nature; & is not supported by increase in household income. It has to burst someday; & trust me That day is not far away.
My guess is "its going to start from the downtown Condo market & spillover to general housing". As investors gets burnt in their condo investments, they become seller of wherever they have profit, that will cause more sellers than buyers & its gets nasty from there... I have been in consultation with several professionals in the industry & many of them share this opinion.

Its always better to sell when the party is still going on: One may miss the little bit of upside (whatever left) but will be protected from a whole lot of downside... expected to happen in the future.

The early 1990's housing scenario is coming sometime in the very near future... (maybe 2013-14 & onwards)

I, too, think this housing situation is strange. I think we are probably due for a correction. That being said, I'm not going to sell my condo. With lawyer fees, realtor fees and the land transfer tax, it would cost a lot of money to move. Plus, my sunk costs of property tax, condo fees and mortgage interest are way less than it is to rent a similar unit. I have to live somewhere. Renting for a few years would add up unless I could successfully invest the equity elsewhere. That's hard considering there are few guaranteed and safe returns. Buying back in TO is also expensive with the land transfer tax. I have thought about selling, but decided against it for these reasons. When the whole thing crashes, I'll still be living in a neighbourhood I like.

[ashedfc]

there are lot of posts here; where I have seen people are desperate to buy a house for whatever reason (& they feel this party will continue forever)...
please read this... before making any decision.

Canada's housing bubble: This time is not different

Bubbles are hard to see in advance and even harder to know when they will burst. No matter how high prices go, there are always analysts who try to justify them by arguing that “this time things are different”. This was the case during the dot com bubble in late 1990s and this is what has been happening nowadays with the housing bubble in Canada.

http://www.theglobeandmail.com/globe...2347630/page1/

Fact is: problems have already started is some areas...
Kelowna seems Canadian Real Estate (equivalent of US Florida Real Estate). Here you go..

Home foreclosures skyrocket in Kelowna
http://www.cbc.ca/news/canada/britis...eclosures.html
.
.

[MortgageQueen]

I DO agree that housing bubbles exist, but not everywhere. I think that's important to understand. Many Major cities are in a bubble, especially Toronto and vancouver.
That said, a large percentage of Cnd's live in small and med. size towns where there has already ocurred a small correction. What THESE resident's have to worry about is the fuel prices for travel. Gas is predicted to go up to $1.50 a L. by mid summer.
This whole Isreal/Iran issue can explode at any moment and we'll be "wishing" for $1.50 a litre.
This is another reason why people need to avoid "maxing- out" on their debt. You may be putting twice the amount of money you're now spending into your gas tank PLUS all of our commodities will likewise go up in price.
Be aware and keep debt low as much as you possibly can.

[Zonny]

We've chosen to be car free (which is kind of biting us in the butt right now because the transit system is on strike). I don't know how people do it, paying this much for gas and insurance and such. I get discounted gas, and it's still expensive to me to half fill a rental car.

[ashedfc]

Welcome to "INFLATION" this mega-trend is coming after 30years, we last saw high inflation in 1980 (prepare for tough times ahead.... all whats needed is a war in the middle east, which is expected to happen any-day now, its almost inevitable).
$1.50 gas might look cheap, the upside is unlimited & "trust me" this itself will cause the next recession, as people are already spending all their spare money in their gas tank...

Regarding housing bubble: its has to start from somewhere & than it spreads.. It cannot start from the entire country at the same time. Like in the US it started from Florida, than Las Vegas, & than spread like wild-fire..
Remember: its the snowflake which causes the avalanche; or its the straw which breaks the camels back..

[croman7]

This thread is giving me sinking feelings right now. I am someone who has more debt than I should. Aside from selling the house, I'm working my hardest to get it paid down quickly, but I can't go any faster!! I hate these grim predictions! (which are quite likely going to come true... just the "when" is to be determined.... I hope it's not soon!) Don't freak me out!!! haha.
Side note : anyone wanna buy a cake? or a hand knitted baby blanket? or possibly a kidney? LOL! Help me speed the process? Just kidding...(ok, kidding about the kidney...but would be up for the other two)...

[Shwa Girl]

This thread is giving me sinking feelings right now. I am someone who has more debt than I should. Aside from selling the house, I'm working my hardest to get it paid down quickly, but I can't go any faster!! I hate these grim predictions! (which are quite likely going to come true... just the "when" is to be determined.... I hope it's not soon!) Don't freak me out!!! haha.
Side note : anyone wanna buy a cake? or a hand knitted baby blanket? or possibly a kidney? LOL! Help me speed the process? Just kidding...(ok, kidding about the kidney...but would be up for the other two)...

O.k.
Gonna make you feel better about things.
At least it's not 18% like back in the day.

[MortgageQueen]

This thread is giving me sinking feelings right now. I am someone who has more debt than I should. Aside from selling the house, I'm working my hardest to get it paid down quickly, but I can't go any faster!! I hate these grim predictions! (which are quite likely going to come true... just the "when" is to be determined.... I hope it's not soon!) Don't freak me out!!! haha.
Side note : anyone wanna buy a cake? or a hand knitted baby blanket? or possibly a kidney? LOL! Help me speed the process? Just kidding...(ok, kidding about the kidney...but would be up for the other two)...

My best suggestion is tackle whatever debt is at the highest interest rate first and formost. It is unlikely to be your house. Once all debt is gone, THEN tackle the house debt. HOWEVER, as per our discussion above, everyone needs to start (actuall should've started a long time ago) a contingency fund should the gas crisis escalate into over-night price increases. Stocking extra pantry items is a good idea too. Don't think that will be a problem on this forum!
I'm not trying to be a doomsdayer or negative. . .but should a war break out in middle east, not only will it affect fuel costs, but it could also cripple some fragile economies in europe which will ripple down throughout the world.

[croman7]

ShwaGirl - no kidding, that is true!

MortgageQueen - That's how I'm tackling it... But it's not an overnight fix. I'm just sayin, I hate to hear that a massive change is near... I dont like massive changes! haha. I've been working to kill the smaller, but higher interest debts first, then the LOC. The house is the least of my concerns (in terms of getting ahead on payments) right now. I only mentioned it because it's essentially the only asset we COULD liquidate if our world fell apart. I don't have a contingency fund - although I know full-well how stupid that is on my part. I also am not impressed with the amount of food in my house. As a couponer, I feel that I'm way behind. I just hope that this "doomsday" that we're all mentioning is at least half year away. I need at least that long to not be terrified. Anyone know of any freebies I can score this week?

[Shwa Girl]

Well, you are right ShwaGirl. It won't make a huge difference. EXCEPT if you are just getting your mortgage now for a 5 yr. fixed rate (or even 10)

And considering the roller coaster in the "shwa" having your emergency fund is important.
You may find it interesting to know that home values were Up in the shwa last month. . so that's nice news.

Yes. This is an INTERESTING area.
*GO Train extension planned from Oshawa to Bowmanville
*Hwy 407 extension planned as far as Hwy 35, going up to Lindsay
* controversial garbage incinerator in Bowmanville = more jobs

[Shwa Girl]

ShwaGirl - no kidding, that is true!

don't have a contingency fund - although I know full-well how stupid that is on my part.

Don't beat yourself up, eh?
Even if you can start really small with the emergency fund.
We said, let's have enough for a bit of gas for the car.
So $10 dollars is a good start.
If you don't need the $10 dollars, it's starts to grow.
Yes, slow, but it grows.

We have $20 in Canadian Tire money.
Big woop, you may say.
But that's $20 worth of gardening supplies for June or July (buying clearance deals like a Smart Canuck would). And it keeps growing too.

Hope this helps.

[snuffaluffagus]

My best suggestion is tackle whatever debt is at the highest interest rate first and formost. It is unlikely to be your house. Once all debt is gone, THEN tackle the house debt. HOWEVER, as per our discussion above, everyone needs to start (actuall should've started a long time ago) a contingency fund should the gas crisis escalate into over-night price increases. Stocking extra pantry items is a good idea too. Don't think that will be a problem on this forum!
I'm not trying to be a doomsdayer or negative. . .but should a war break out in middle east, not only will it affect fuel costs, but it could also cripple some fragile economies in europe which will ripple down throughout the world.

I have a question . My mortgage is my only debt, renewable in Oct., 2013. If the rate increases by only a few percent from what we are paying now, I'll most likely be screwed if our situation doesn't change . How could I tackle my mortgage now while I'm still able to?

We've looked into downsizing but, the cost of homes is nuts in comparison to what we paid for ours only 3 years ago. For a home 1/3 the size with land 1/10 the size, we'd only be ahead by 15-20K if we decided to move. I'm not sure I'm willing to give up our house for such a small difference. What do you all think?

[croman7]

I have a question . My mortgage is my only debt, renewable in Oct., 2013. If the rate increases by only a few percent from what we are paying now, I'll most likely be screwed if our situation doesn't change . How could I tackle my mortgage now while I'm still able to?

We've looked into downsizing but, the cost of homes is nuts in comparison to what we paid for ours only 3 years ago. For a home 1/3 the size with land 1/10 the size, we'd only be ahead by 15-20K if we decided to move. I'm not sure I'm willing to give up our house for such a small difference. What do you all think?

I dont know much about whetehr to sell or stay... but try to make extra payments if you're allowed. Or maybe start an emergency fund to cover the future costs of the mortgage. for example, if your mortgage is $550 biweekly now, but you think it'll go up to $650, try to save those $100 differences as soon as you can! That way you could have them prepared for the increase. (unless of course you could make a huge payment and it would reduce the amount of the mortgage to an amount that would give you reasonable payments...) Don't ask me what math is involved there...but youd have to play with the numbers and see what's best for yourself.
i try selling cakes on the side. I also knit and want to sell some of that. Do you have any crafts/side projects that you're good at? Anything that could translate into sales? you could dedicate your "project income" strictly to the mortgage. Or you could try bartering for services that you already pay for. If you have a friend that cuts hair, you could get her to cut your hair in exchange for babysitting her kids. Or something like that. Money saved is just as good as money earned! (better, if you factor in taxes...) Good luck! I can relate, I'm in a similar situation (where an interest increase will really hurt me). Stick together, we can do it!

[ashedfc]

I dont know much about whetehr to sell or stay... but try to make extra payments if you're allowed. Or maybe start an emergency fund to cover the future costs of the mortgage. for example, if your mortgage is $550 biweekly now, but you think it'll go up to $650, try to save those $100 differences as soon as you can! That way you could have them prepared for the increase. (unless of course you could make a huge payment and it would reduce the amount of the mortgage to an amount that would give you reasonable payments...) Don't ask me what math is involved there...but youd have to play with the numbers and see what's best for yourself.
i try selling cakes on the side. I also knit and want to sell some of that. Do you have any crafts/side projects that you're good at? Anything that could translate into sales? you could dedicate your "project income" strictly to the mortgage. Or you could try bartering for services that you already pay for. If you have a friend that cuts hair, you could get her to cut your hair in exchange for babysitting her kids. Or something like that. Money saved is just as good as money earned! (better, if you factor in taxes...) Good luck! I can relate, I'm in a similar situation (where an interest increase will really hurt me). Stick together, we can do it!

Good Advice
Conserve cash, spend as less as possible.
Use your skill (whatever you have) to generate value, as mentioned by the previous post (bartering can be helpful in some areas -as you exchange skills)
Instead of paying extra towards your mortgage (once you pay the money is gone); its more advisable to keep the extra money in a separate account & call it sacred money (only for the purpose of emergency & have a strict definition of what emergency means..... going on vacation/ buying sofa/ exclusive dinner in fine dine/ etc. is not emergency)..

Get practical & be realistic - "One cannot spend more than they earn" if they do, they are inviting trouble.

[Shwa Girl]

Get practical & be realistic - "One cannot spend more than they earn" if they do, they are inviting trouble.

Good advice.
The quote looks familiar.
Richest Man in Babylon?