What is the Bank of Canada Rate?

It is a rate which is currently at 1% that the government lends to the bank. The bank, in turn, lends to the public at 3% which is called the prime lending rate. The prime lending rate affects everyone who has secured or unsecured lines and variable rate mortgages.

The Bank of Canada Rate is a mechanism to control inflation in this country. Mortgage rates are controlled by the bond and the stock market.  Thus, the Bank of Canada and mortgage rates are not the same. Mortgage rates change more often than the Bank of Canada rate. The Bank of Canada Rate usually stays the same for 4-6 months and sometimes it may be longer.

The Bank of Canada is represented by Stephen Poloz and it is expected that the Bank of Canada Rate (known as prime) will remain the same until the beginning of 2015.

The Bank of Canada Rate will remain the same for the following reasons.

1. Indeed inflation has gone up and Canadians are feeling the pinch on gas and food prices. However, the inflation rate has not passed the desired thresholds that will trigger an increase anytime soon.
2. The Canadian dollar is still strong which is good for us to buy American Dollars or Euros. But it is not good for the manufacturing sector since our exports are affected by the dollar. A stronger dollar means less exports are being made. People who work in the factories are seeing that things are indeed slower.
3. Also, if the Bank of Canada rate goes up, the foreign investors like it and it in turn increases the Canadian dollar.
4. But if the Prime lending remains low, the real estate market will be strong since a lot of people are able to buy, and or renovate. So the construction sector is strong.
5. Although our economy is stronger among the G8 Group, we are still affected on what happens worldwide. We are not immune. So things that happen in Europe, Asia and the United States do have a ripple effect in Canada.

But with a majority government in Ottawa, the Bank of Canada doesn’t want to increase prime too soon. So for now, anyone who has a variable rate mortgage, STICK WITH IT. 

Always be an informed client.

For more information contact your Toronto Mortgage Broker 

at 416-920-9931

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Buy A New House or Sell Your Old House First - Chicken Or The Egg?

The huge question looms: does one buy the new house first? Or sell the old one?

The second-or third-time buyer will need to consider the matter of an existing house, ongoing mortgage payments, and the cash needed for the down payment required to close on the new house. You have the money of course, there is real equity in your current home, but until that home is sold that cash is locked up securely in your current mortgage bank's vault.

So, what comes first, the chicken or the egg? Sell first, and, particularly in a sellers market, risk becoming homeless, or perhaps worse, moving in with the in-laws while the furniture is in storage

Or, in a buyers market, find the perfect house but you are unable to make an offer because your house might take a while to find a buyer.

What are my options?

Do your homework. Get pre-approved for a mortgage

• If you decide to own two homes, look into a refinance of your existing house which will give you the funds for the down payment of the new house.
• Arrange for a home equity line of credit. However, you must put that line of credit in place before listing your house. The bank will send out an appraiser and he will probably notice and report the sign on your front lawn.
• Arrange a bridge loan. However, a firm sale and purchase must exist.

Always be an informed client.

For more information contact your Toronto Mortgage Broker 

at 416-920-9931

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What is mortgage fraud?

Mortgage fraud is any scheme designed to obtain a mortgage under false pretenses. It can be as simple as falsifying information in a loan application, or more sophisticated involving one or several individuals attempting to defraud a financial institution or innocent parties of money through a mortgage loan.


Not only is the dollar value of these fraudulent activities on the rise, but also the fraudsters themselves are becoming increasingly sophisticated and well organized. Impersonation often occurs when an individual applies directly to a lender, or through a mortgage broker or specialist, for a loan secured by real property where title is held either jointly by husband and wife, or by one of the spouses alone, and the loan application is submitted by one spouse or co-borrower.


In some instances the borrower may arrange to have an impostor appear as the co-borrower/ consenting spouse in order to have the mortgage executed. Often these impostors are business associates, organized criminals to whom the borrower owes money or an individual with whom the borrower is involved in a clandestine relationship.


Frequently, these impostors are able to provide some sort of identification that the borrower has managed to obtain from the unsuspecting spouse/co-borrower. Often, in cases of impersonation, lenders and brokers are instructed not to contact the borrower at home, so the risk to the borrowers of the innocent spouse learning of the mortgage before it has been funded are minimized.


The mortgage is signed by the borrower or the impostor, the funds are advanced and it may be several months before the innocent spouse or person becomes aware of the mortgage to which they did not consent or agree.


A far more sophisticated type of mortgage fraud involves identity theft. The fraudster targets an individual who owns real property of significant value, either free and clear of mortgages or with minimal secured debt. Unfortunately, the significant amount of information made readily available by the Internet and the advent of electronic record keeping by registry offices make the process of finding these individuals relatively easy.
The fraudster uses the identity of the intended victim, which purposefully matches that of a lender's ideal client, to apply for a mortgage. Using the victim's credit worthiness and land security to make the transaction enticing to the lender or broker, the fraudster receives loan approval easily.


There are many ways of preventing mortgage fraud. The first is to protect yourself from identity theft. You can also conduct a property search at your provincial land registry office to ensure that the title to your home is in your name.


We recommend clients to purchase Title Insurance to protect your home. Title Insurance can provide valuable protection against losses incurred by lenders as a result of fraud. Such insurance typically covers the following items.

• The cost of defending one's right of ownership, which can cost tens of thousands of dollars;
• The stress and uncertainty surrounding the a resolution of title-related problems;
• The time spent waiting for resolution from the Land Titles Assurance Fund; and
• The loss associated with a fraudulent mortgage that is entitled to remain registered against the true home owner's interest. 

Despite this coverage, however, fraud ultimately costs every party to the transaction money whether by way of increased interest costs or administrative fees. As those who are prepared to engage in fraudulent activities become more bold and sophisticated and are linked more often to rings of organized criminals, it is incumbent on the lending community to do everything in its power to address this challenge.

For more information contact your Toronto Mortgage Broker 

at 416-920-9931

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What is a Mortgage Broker and why deal with one?

What is a Mortgage Broker?

A Mortgage Broker is an independent, trained professional licensed to represent and provide you with the best advice for your mortgage needs. Mortgage Brokers primary expertise is locating funding for mortgage financing. They know where the best rates can be found. What's more, they have the knowledge required to present a proposal for financing to lenders in the best way possible to successfully obtain mortgage financing. They negotiate, place, assist in placement, find or offer to arrange mortgage loans on residential and commercial properties for you, the borrower. Lastly a mortgage broker is paid a fee by the bank to serve as a liaison between borrowers and lenders. So the best part that we are free.

All mortgage brokers are licensed and regulated by the Financial Services of Ontario.

So Why Use/Deal with a Mortgage Broker?

Mortgage Brokers represent you, the customer, not the lender. Because they are not employees of a lending institution, Brokers are not limited in the product they can offer you. Brokers seek out the best lender package to suit your specific situation, whether it’s with a Chartered Bank, Trust or Insurance Company, or Private Funds.

Unlike the banks, Brokers don’t cross-sell their clients. They will not encourage you to bring over your savings, checking or credit cards to get their best rates. Brokers can find you the very best rates from multiple lenders nationwide…not just the rates of a single institution.

Brokers are also less concerned than banks about buyers who are self employed, recently divorced or have damaged credit histories including bankruptcies. The can easily originate loans for the self-employed and those preferring no documentation or low documentation loans. It’s also much easier to acquire financing for investment properties and vacation homes through a broker. Very importantly, Brokers are very wiling to work on YOUR TIME … not just during banking hours.

There is a wide assortment of options and features available to homebuyers today and shopping around takes a lot of time and effort. The mortgage process within today's very competitive marketplace intimidates many Canadian homebuyers. It pays to work with a mortgage professional who will represent you and ensure the mortgage you get is the one best suited to your needs.

Since real estate tends to represent the single largest investment most of us ever make, it is vital to secure the best financing available. Every borrower has different needs, every property is unique and every lender has its own rules and programs.

Choosing the wrong mortgage can cost you thousands of extra dollars. Mortgage Brokers are trained professionals who can help you save on your mortgage dollar.

What are the Reasons to use a Mortgage Broker?

• Access to over 36 different lenders, banks, trust companies, investors and financial institutions.
• Fast credit and loan pre-approvals with no cost or obligation.
• Up-to-date on all the mortgage rates, terms and re-payment options available on the market.
• They only specialize in mortgages and are knowledgeable on current trends.
• They are experts at matching you with the best-suited mortgage.
• Get mortgage rates at wholesale, guaranteed up to 120 days.
• They work for YOU, not the bank.
• They increase competition in the market place, thus keeping rates low.
• They save you time and money!Brokers have vested interest in satisfying your needs since they rely on referrals and repeat business.
• Brokers are also more likely to find mortgages for borrowers with credit problems or lack of income.
• Your time is precious and shopping for a mortgage rate is a time consuming task. A mortgage broker will shop and know the best mortgage rates from bank to bank. The best part is, it is a free service.
• Getting the right mortgage advice saves you money.

So to save you time and money speak to a mortgage broker.  Become an informed client. 


For more information contact your Toronto Mortgage Broker 

at 416-920-9931

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Is mortgage insurance and life insurance the same?

The answer is NO. The only common thing is that someone needs to die in order to collect.

Mortgage insurance is usually offered by the banks. As you pay down your mortgage, your coverage amount decreases with it. When someone passes away, the balance of your mortgage is paid off. Ultimately, the beneficiary of a mortgage insurance policy is the bank.

Life insurance is usually offered by insurance brokers. With a term life insurance policy, you have a constant level of coverage for the whole term. So when someone dies, the family receives the payout and this gives them the flexibility of using the money to pay off debts, mortgage or anything else they would prefer.

When purchasing or refinancing your home, take the time to shop around for insurance  and compare.  It is best to some insurance then not to have any at all. Be an informed client.

For more information contact your Toronto Mortgage Broker 

at 416-920-9931

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