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First Rate A newsletter specifically designed to keep you updated on interest rate trends |
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November 2006
Dear Homeowner,
As a homeowner (or prospective homeowner), investor or real estate professional, you rely on your mortgage professional to keep you informed about interest rate movements and trends. This newsletter is designed to do just that.
In this issue:
- Market commentary and Interest rate trends
- AIG Insurance to enter Canadian Market as mortgage insurer
Market commentary & Interest rate trends
We continue to follow Jeff Rubin of CIBC World Markets. His team holds on to their prediction of a 1% drop in the prime rate to 5.0% by December 2005. The lower interest rate is attributed to lower inflation rates on both sides of the border. Consequently, if you're intent on locking-in, we suggest you wait another 12 months before doing so. At this time, you're better off with a variable rate mortgage.
Rates and Charts
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Prime @ 6.0% (next review on Dec 5, 2006)
Term
Sep 15
Sep 22
Sep 29
Oct 6
Oct 13
Oct 20
Oct 27
3 year
5.30%
5.30%
5.30%
5.29%
5.29%
5.29%
5.29%
5 year
5.29%
5.29%
5.29%
5.29%
5.29%
5.29%
5.29%
10 year
5.69%
5.74%
5.69%
5.69%
5.69%
5.74%
5.69%
Table shows the discounted residential mortgage rates for 3, 5 and 10 yr closed fixed rate mortgages
For a longer term view, click here to see the 3, 5 & 10 year best residential rate since September 2003 (updated monthly)
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Click to view other relevant graphs
AIG Insurance to enter Canadian Market as Mortgage Insurer
Competition in the mortgage insurance market is about to heat up with AIG's announcement on Oct 17 to enter the Canadian mortgage market as a mortgage insurer. Up until now, Canada has had only two mortgage insurance companies, CMHC and Genworth, both of whom mirrored each other in terms of fees and policy guidelines.
AIG announced an innovative product line of mortgage insurance products including a 3% down payment product and a 10% down payment mortgage product for rental products. These products are currently unavailable in the Canadian mortgage scene. In addition, AIG's will allow borrowers with good credit to spend up to 44% of their gross income (vs. CMHC and Genworth at 40%) and extend amortizations up to 40 years. This will allow borrowers to qualify for a much larger mortgage.
As of now, mortgage lenders have not yet implemented AIG's product line. It is expected to take a few months for lenders to adapt their systems to work with a new mortgage insurance company.
Attend our upcoming seminar on how to make your mortgage tax deductible. Click here for details:
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Please consider the information provided in this newsletter as general information. Before you do anything consult a professional.
To unsubscribe, please click reply with the subject "unsubscribe" and you will be removed from this email list.