Bank of Canada holds steady on rates, 2013 economic prediction

 

Bank of Canada holds steady on rates, 2013 economic prediction

Kevin Carmichael - Globe and Mail

The Bank of Canada is looking through weaker economic growth, opting to leave its benchmark interest rate unchanged, and holding to a prediction that Canada's economy should gather pace next year.

 

"In Canada, economic activity in the third quarter was weak, owing in part to transitory disruptions in the energy sector," the Bank of Canada said in a statement at the end of its latest round of policy deliberations Tuesday. "Although underlying momentum appears slightly softer than previously anticipated, the pace of economic growth is expected to pick up through 2013."

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Term Our Rate Bank Rate
3 yr Fixed 2.74% 4.35%
5 yr Fixed 2.89% 5.35%
5 yr Variable 2.65% 4.00%
Updated : December 04, 2012
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Paramjeet Nagi

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Major Changes To CMHC Rules !!!

 

Major Changes To CMHC Rules!!!

Finance Minister Jim Flaherty has just announced sweeping changes to Canada Mortgage and Housing Corporation (CMHC)Canada’s national housing agency. CMHC is Canada’s premier provider of mortgage loan insurance, mortgage-backed securities, housing policy and programs, and housing research.

The 3 major changes are as follows;

1) A reduction in MAX amortization for CMHC insured mortgages from 30 yrs back down to 25 yrs.  This is will result in Canadian home buyers paying less in mortgage interest payments over the course paying off your home.  The downfall is that fewer people will qualify for a mortgage as the payments will be higher, and more income will be required to qualify for a mortgage.

2) Homes priced over $1 million are no longer eligible for CMHC insurance.

3) MAX refinance has been reduced from 85% (Loan To Value) LTV to 80% LTV.

Read More ... The Globe and Mail

Paramjeet Nagi, Broker

www.pnagi.com

416-884-1770


Bank of Canada maintains overnight rate

 

Bank of Canada maintains overnight rate

 

          Bank of Canada announced this morning that they will keep the overnight rate steady at 1%. The overnight rate is what the major banks use to benchmark the Prime rate mortgages, which is currently at 3%. 

 

The bank did hint, however, that it may resume rate hikes sooner than expected.

 

For anyone in a variable rate mortgage it means that your interest rate will remain constant for the coming months as the Bank of Canada did not give any indications of increasing the Prime rate. 

 

Next Meeting: July 17

Prime Rate: 3.00%


To learn more about the dynamics behind this decision, check out the articles below.

 

Bank of Canada holds rates steady

Globe and Mail - Jeremy Torobin

The Bank of Canada left its main interest rate untouched at 1 per cent Tuesday and again suggested that it will tighten borrowing costs when economic conditions allow such a move, while hinting this is farther off than policy makers were anticipating just six weeks ago. 

 

Click here to read the full article

 

Paramjeet Nagi, Broker

www.pnagi.com

www.mygtamortgage.com