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Category Archives: Alberta Health services

Bank of Canada makes a change

As you know, your variable rate mortgage, line of credit and/or student loans are all based on the Prime Rate and here is your personal update from me on the recent Bank of Canada announcement. To everyone’s surprise, the Bank of Canada has increased their Overnight Rate by 0.25%. When this happens, it typically means that your Prime Rate is going to increase as well but not always by the same amount. It can also mean that not every lender will adjust their prime rate the same way.  Keep an eye out later today for further updates on your specific lenders’ prime rate.

 

Recent economic data has been stronger than expected hence a surprise to see the Bank increase their rate again so quickly; we haven’t seen that in over 10 years!  You have to admit that we have had it good for a long time and we can still continue to benefit from low rates and don’t panic!

 

We have seen two increases in the last three months, and even though it is only 0.25%, this second increase may start to impact your monthly budgeting and cash flow.   Fixed term interest rates are still super low with five-year fixed rates in the 2.99% to 3.09% range.  If the net interest rate on your current variable is the same as or higher than the current fixed term rates right now, even though the prime rate will still remain low for a while now, it might be time to chat about your options including potentially converting to a fixed term.  Converting to a fixed term isn’t right for everyone as other factors are to be taken into consideration such as payment change, income and future plans such as renovating, moving etc.  Call me so I can calculate what your new payment would look like and also if it is suitable for you.

 

Have you really made the most of the low payments you have had?   How much do you have saved up or how closer are you to your mortgage burning party because you have made extra payments on your mortgage?   Or maybe you just got a little carried away and have some high interest credit card debt that you can’t seem to pay off in full each month.

Don’t worry, if you aren’t as far ahead as you would like to be, we can work together to create a plan to get you back on track… so back to school isn’t just for the kids…us adults can benefit from going to back to the drawing board with our finances, savings and future financial wealth goals.

To continue with the Bank of Canada news, here is an excerpt of the announcement and what they had to say about their decision:

 “Recent economic data have been stronger than expected, supporting the Bank’s view that growth in Canada is becoming more broadly-based and self-sustaining. Consumer spending remains robust, underpinned by continued solid employment and income growth.  There has also been more widespread strength in business investment and in exports. Meanwhile, the housing sector appears to be cooling in some markets in response to recent changes in tax and housing finance policies… the level of GDP is now higher than the Bank had expected.

The global economic expansion is becoming more synchronous, as anticipated in July, with stronger-than-expected indicators of growth, including higher industrial commodity prices. However, significant geopolitical risks and uncertainties around international trade and fiscal policies remain, leading to a weaker US dollar against many major currencies. In this context, the Canadian dollar has appreciated, also reflecting the relative strength of Canada’s economy.”

 

I wonder if I can ask a favour; Going with my theme of “Let the sun set and the leaves fall along with Canadian consumer debt with our help” if you hear a friend or family member talk about going thru a financially tough time – maybe I can help with some budgeting, credit counselling and debt consolidation options for them.  In either of these cases, would you mind passing my contact information on to them – this is very much appreciated.

 

I’ll be in touch again for the next announcement on October 25, 2017.

 

Yours truly,

 

Eva Neufeld
Mortgage Tailors
(780) 244-0505

 

Bank of Canada Update

Good morning

 

As you know, your variable rate mortgage, line of credit and/or student loans are all based on the Prime Rate and here is your personal update from me on the recent Bank of Canada announcement. As predicted the Bank of Canada has increased their Overnight Rate by 0.25%. When this happens, it typically means that your Prime Rate is going to increase as well but not always by the same amount. It can also mean that not every lender will adjust their prime rate the same way – even now we have one of the major banks prime rate being 0.15% higher than everyone else’s. Keep an eye out later today for further updates on your lenders’ prime rate.

 

Now Don’t Panic! based on this news, it might be time to assess your current mortgage situation and how we can ensure you are making the right choices for your long-term goals. Now is the time to focus on one of the following key areas:

Make a Plan: You need to do a financial benefit analysis based on what your short and long-term plans are. If you are planning to move in the next few years a variable rate might still be a better option with the lowest penalty, but if you are in your forever home and have a key focus on being mortgage free by a specific timeline such as retirement or sooner, than a fixed term may be more suitable. Everyone’s situation is different so having a customized mortgage that meets your needs, and not the lender, is always the way to go!

Get some advice from me, your Mortgage Broker (not your lender), on what this increase means for you and your situation. Lenders and the media can create a panicked frenzy which might encourage you to think about locking in now in fear of rates going up even further. This means more profit for the lender, a longer commitment from you and difficultly breaking that mortgage later!

 

To continue with the Bank of Canada news, here is an excerpt of the announcement and what they had to say about their decision today:

 

“Recent data have bolstered the Bank’s confidence in its outlook for above-potential growth and the absorption of excess capacity in the economy. The Bank acknowledges recent softness in inflation but judges this to be temporary. Recognizing the lag between monetary policy actions and future inflation, Governing Council considers it appropriate to raise its overnight rate target at this time. The global economy continues to strengthen and growth is broadening across countries and regions. The US economy was tepid in the first quarter of 2017 but is now growing at a solid pace, underpinned by a robust labour market and stronger investment.

Canada’s economy has been robust, fuelled by household spending. As a result, a significant amount of economic slack has been absorbed. The very strong growth of the first quarter is expected to moderate over the balance of the year, but remain above potential. Growth is broadening across industries and regions and therefore becoming more sustainable. As the adjustment to lower oil prices is largely complete, both the goods and services sectors are expanding. Household spending will likely remain solid in the months ahead, supported by rising employment and wages, but its pace is expected to slow over the projection horizon.  At the same time, exports should make an increasing contribution to GDP growth. Business investment should also add to growth, a view supported by the most recent Business Outlook Survey.”

 

Fixed term rates have increased slightly since the last announcement with a five-year fixed term ranging from 2.69% to 2.89%.   If your variable interest rate is higher than this, it might be worth us revisiting to see if we can make some changes and save you unnecessary interest.  Don’t forget the lower rates quoted here might have specific conditions for qualifying and remember that the prime rates and fixed term rates are impacted by two different sets of economic drivers.  Therefore, increases in fixed rates doesn’t always mean the same increase in prime rates and vice versa.

Based on this recent announcement, and the anticipation that the prime rate will remain low and not likely increase for another few months, unless you feel otherwise, I’d recommend that you remain with your current variable rate product if the interest is still lower than a fixed term rate right now.  However, if having a fixed payment is important to you, call me so I can calculate what your new payment would look like and if it is suitable for you.

If you have accumulated some other higher interest debt, this might be the best time to consider a refinance to get you back on track and consolidate. Some of us have not made the most of these low payments and have taken advantage by spending more and more. How much do you have saved up or how closer are you to your mortgage burning party because you have made extra payments on your mortgage? Or maybe you just got a little carried away and have some high interest credit card debt that you can’t seem to pay off in full each month. It is never too late to get back on track. Let’s spend some time and look at how we can consolidate these before interest rates go up further!

Reach out to me for a pro bono consultation to review YOUR situation. DON’T listen to the lender that might be calling you to get you to lock in your amazing variable rate based on fear. Let’s review the math, the facts and then decide what is right for you! I’m here to help you save unnecessary interest by keeping more money in your pocket and not anyone else’s!

I’ll be in touch again for the next announcement on September 6, 2017 and don’t forget to feel free to share this with your friends and family.

 

Yours truly,

 

Eva Neufeld
Accredited Mortgage Professional
Mortgage Tailors
(780) 244-0505
Web:  www.mortgagetailors.com

 

Bank of Canada Announcement

Good morning

 

As you know, your variable rate mortgage, line of credit and/or student loans are all based on the Prime Rate and here is your personal update from me on the recent Bank of Canada announcement on changes to their Overnight Rate which in most cases impacts your Prime Rate.

At 10:00 am EST, Wednesday May 24, 2017, the Bank of the Canada again maintained their overnight rate which means no change to your interest rate.   Let’s not forget that this is a great time to take advantage of such historical low rates.  As the weather gets even warmer you might be thinking of:

Accessing the equity in your home for some debt consolidation or renovations especially if you have noticed a significant increase in house values in your area based on this crazy Spring market!

Worried about your kids not being able to afford or qualify to get into the housing market EVER!  Have you thought about purchasing a home of their choice as an investment property.  I can work with them to get them on the right qualifying and savings plan and you could even consider working with them to purchase it from you in the future – this is commonly known as Rent to Own and something I can help you with – reach out and let’s chat!

 To continue with the Bank of Canada news, here is an excerpt of the announcement and what they had to say about their decision:

 “Inflation is broadly in line with the Bank’s projection… Food prices continue to decline, mainly because of intense retail competition, pushing inflation temporarily lower.   The global economy continues to gain traction and recent developments reinforce the Bank’s view that growth will gradually strengthen and broaden over the projection horizon.   

The Canadian economy’s adjustment to lower oil prices is largely complete and recent economic data have been encouraging, including indicators of business investment. Consumer spending and the housing sector continue to be robust on the back of an improving labour market, and these are becoming more broadly based across regions. Macroprudential and other policy measures, while contributing to more sustainable debt profiles, have yet to have a substantial cooling effect on housing markets. Meanwhile, export growth remains subdued in the face of ongoing competitiveness challenges.

The Bank’s monitoring of the economic data suggests that very strong growth in the first quarter will be followed by some moderation in the second quarter.  So, it looks like it is still anticipated that prime rates won’t start increasing until well into 2017 but we are being given the heads up that they will start increasing eventually.  Remember, that any increase to the prime rate since 1992 has only been by 0.25% at any ONE time, so you won’t see a large significant increase all at once.

 

Interest rates haven’t really changed since the last announcement with;

 

  1. Fixed rates ranging from 2.49% to 2.79%
  2. The discount on the variable rate has improved with as low as prime minus 0.80% to 0.50% so 90% to 2.25%. If your interest rate is higher than this on your variable it might be worth us revisiting to see if we can make some changes and save you unnecessary interest.  Don’t forget the lower rates quoted here might have specific conditions for qualifying.

 

Also, remember that the prime rates and fixed term rates are impacted by two different sets of economic drivers and so increases in fixed rates doesn’t always mean the same increase in prime rates and vice versa.

 

Based on this recent announcement, and the anticipation that the prime rate will still remain low for a while now, unless you feel otherwise, I’d recommend that you remain with your current variable rate product as the interest is still lower than a fixed term rate right now.  However, if having a fixed payment is important to you, call me so I can calculate what your new payment would look like and also if it is suitable for you. I’ll be in touch again for the next announcement on July 12, 2017.

 

I wonder if I can ask a favour; It is that time of year that many may be not going on a summer vacation or putting their kids into summer camps because they can’t afford it and finances are tight.  If they are a home owner and have some equity, we could potentially help accessing it to help them get financially stable again or at least a little bit further ahead.   If you know anyone that sounds just like this, would you mind passing my contact information on to them.   This is very much appreciated.

 

Yours truly,

 

Bank of Canada Announcement

Good morning

 

As you know, your variable rate mortgage, line of credit and/or student loans are all based on the Prime Rate and here is your personal update from me on the recent Bank of Canada announcement on changes to their Overnight Rate which in most cases impacts your Prime Rate.

 

At 10:00 am EST, Wednesday April 12, 2017, the Bank of Canada held it’s prime lending rate. So let’s not forget that this is a great time to take advantage of such historical low rates.  As the weather warms up you might be thinking of

Accessing the equity in your home for some renovations especially if you have noticed a significant increase in house values in your area based on the Spring market!

Moving this year (downsizing or upsizing) and need to understand your financing options

 

Taking advantage of the low interest rates and purchasing a cottage, rental property or somewhere for a family member to live in (for University, College or keeping aging family closer to you).

 

Let’s chat about your options – it is never too late, or early, to start planning especially as it has been proven that real estate is an amazing long term investment!   Chat to me about your options … I’d be happy to make those plans into realty.

To continue with the Bank of Canada news, here is an excerpt of the announcement and what they had to say about their decision:

 “Global economic growth is strengthening and becoming more broadly-based than the Bank had expected … although there is still considerable uncertainty about the outlook. In the US, some temporary factors weighed on economic activity in the first quarter but the drivers of growth remain solid. The US is close to full employment, unlike many other advanced economies, including Canada, where material slack remains. Global financial conditions remain accommodative.  

In Canada, recent data indicate that economic growth has been faster than was expected…  Growth was temporarily boosted by a resumption of spending in the oil and gas sector and the effects of the Canada Child Benefit on consumer spending. Residential investment has also been stronger than expected. Employment data have been robust, although gains in hours worked are still soft. Meanwhile, export growth has been uneven in the face of ongoing competitiveness challenges. Further, despite a recent uptick in sentiment, business investment remains well below what could be expected at this stage in the recovery. Accordingly, while the recent rebound in GDP is encouraging, it is too early to conclude that the economy is on a sustainable growth path.”

The Bank acknowledges the strength of recent data, some of which is temporary, and is mindful of the significant uncertainties weighing on the overall economic outlook; So it looks like it is still anticipated that prime rates won’t start increasing until well into 2017 but we are being given the heads up that they will start increasing eventually.  Remember, that any increase to the prime rate since 1992 has only been by 0.25% at any ONE time, so you won’t see a large significant increase all at once.

 

Interest rates have changed slightly;

 

  1. Fixed rates have gone down a bit at 54% to 2.79%
  2. The discount on the variable rate has improved with as low as prime minus 0.65% to 0.70% so 05% to 2.00%. If your interest rate is higher than this on your variable it might be worth us revisiting to see if we can make some changes and save you unnecessary interest.

 

Also, remember that the prime rates and fixed term rates are impacted by two different sets of economic drivers and so increases in fixed rates doesn’t always mean the same increase in prime rates and vice versa.

 

Based on this recent announcement, and the anticipation that the prime rate will still remain low for a while now, unless you feel otherwise, I’d recommend that you remain with your current variable rate product as the interest is still lower than a fixed term rate right now.  However, if having a fixed payment is important to you, call me so I can calculate what your new payment would look like and also if it is suitable for you. I’ll be in touch again for the next announcement on May 24, 2017.

 

I wonder if I can ask a favour; It is that time of year that many think about what they want to accomplish this year – if buying their first home is on the “wish list”, would you mind passing my contact information on to them.  With all the hot markets out there now, and changes to mortgage legislation, there is a lot of confusion especially amongst our first time home buyers and my specialty is walking them thru the steps with ease!  This is very much appreciated.

 

Yours truly,

Eva Neufeld
Mortgage Tailors
(780) 244-0505