RENEW YOUR MORTGAGE THE RIGHT WAY!
If you are contemplating renewing your mortgage then you should really consider the opportunity that is before you. There are many things that may have changed since you first took out the mortgage. You may be looking to use your home equity to fund a renovation project on your home. Alternatively, you may want to use that equity in other ways, such as purchasing a cottage or holiday home. You may also want to make some long-term investments to secure your future.
There is also the option of putting your other high-interest debts into your mortgage when it is up for renewal. This is one way that Canadians are able to reduce their debt and save on interest payments. In fact, there are many ways to save money when you renew your mortgage.
Saving Money with Your Mortgage Renewal
There are three basic things you need to do to get the best deal on yourmortgage renewal. Be prepared, create a plan, and set an early meeting with a broker.
This means dont be caught off-guard when your mortgage comes up for renewal or you will miss the opportunity to get the best rate and one that suits your needs. You can start talking with lenders a couple of months before your mortgage is up for renewal. Keep in mind that the longer you wait, the less chance you have to save money.
Create a plan
Before you start talking to your broker about renewing your mortgage, decide what you want to do. Consider the best way to use the equity you have earned on your home. You can also take the opportunity to change mortgage lenders. There is no need to stay with your current provider. A mortgage renewal presents a chance to find a lender who better fits what you want in a financial institution.
Meet a broker
Before you decide on whether to sign with your current lender or switch to a new one, meet with a mortgage broker. These are professionals who can offer you advice based on your unique situation. They can also help you find better lending terms if that is what you are looking for.
While it can take a little extra effort on your part, getting a mortgage that works for you is worth the effort. It is important that you are prepared when you renew your mortgage so that you can make the most of the equity you have. This means you need to be ready on your renewal date, have a clear idea of what you want to do with your equity and set a meeting with your broker well in advance.
Call me today if youd like to save money on your next mortgage renewal! 416-568-5111
Higher interest rates and household debt: Cause for recession?
From National Bank of Canada
There is a great deal of concern regarding the vulnerability of Canadian households not only to inflation shock but also to sharp interest rate hikes.
For heavily indebted households, the bill could prove hefty. Those that contracted mortgages 4.Sx their gross income could see their monthly payments increase by $187 to $281 from 2022 to 2024 and absorb as much as 2.6% to 4.0% of their net income.
At the macroeconomic level, however, the story is far different given the high proportion of properties without mortgages. By our calculations, the payment shock related to servicing the accumulated debt will represent 0.65% of disposable income over the next three years. The amount is significant but manageable in that it alone will not suffice to pull the economy into a recession.
Prices continue to lose momentum in June
With the decrease in resale market transactions and the increase in interest rates, property price growth moderated for a third consecutive month, but still remained solid in June at 1.0% after adjusting for seasonal effects. Using the seasonally adjusted unsmoothed index, which is more sensitive to market fluctuations, the moderation is even more pronounced, with property prices essentially flat in May and June. While the Bank of Canada has indicated that it will continue to raise its policy rate and that transactions in the real estate market should continue to decline, we anticipate that the composite index should decrease by 10% by the end of 2023. The price declines have already begun to spread across the country. In fact, for all 32 markets where the seasonally adjusted unsmoothed index was available in June, 58% experienced a decline during the month, compared to 34% in May and only 16% in January. We have to go back to May 2020, at the very beginning of the pandemic when uncertainty was at its peak, to find such a large proportion of markets in decline.