After months of anticipation, Finance Minister Jim Flaherty shocked many by announcing that Stephen Poloz would be taking over Mark Carney’s position as Governor of the Bank of Canada. Most news sources had predicted Flaherty would appoint Tiff Macklem, the bank’s senior deputy governor, as his current position leaves him as the most obvious choice. However, Flaherty believes Poloz is the strongest candidate, as he brings a previous 14-year stretch at the Bank of Canada as well as years working abroad – including stints at the International Monetary Fund in Washington and the Economic Planning Agency in Tokyo. “Mr. Poloz has significant knowledge of financial markets and monetary policy issues and extensive management experience. We are confident Mr. Poloz will make an outstanding contribution to the work of the Bank and uphold its reputation as a leading central bank,” said David Laidley, Chair of the Special Committee of the Board of Directors.
Stuck in traffic: How mortgages could ease congestion – CBC News
A recent Pembina Study found that 80 per cent of residents in the Greater Toronto Area would give up the suburban lifestyle (big house, big car), in order to live in one of the walkable and transit-friendly neighbourhoods in the downtown core. Unfortunately, this tends to be more of a dream than a reality for most people, especially first-time buyers, as downtown property comes at a high cost. Continue reading →
Finance official questions link between cooling housing market and mortgage rules – The Globe and Mail
Canada’s deputy minister of finance, Michael Horgan isn’t convinced there is a link between the new tighter mortgage rules, introduced in July of this year, and the recent cooling in the housing market. “There’s some evidence that the housing market…is cooling and slowing at the moment,” he said in a rare public speech at Carleton University. Horgan went on to say that “it’s too early to make the direct link.” These comments are likely a response to economists who have already claimed that policy changes have impacted the housing market, including Benjamin Tal of CIBC and Gregory Klump of the Canadian Real Estate Association. The deputy minister of finance agrees that there is likely some cause and effect at this point, but attributed most of the market cooling to Canadians starting to reign in their debts. Jim Flaherty echoed his deputy’s comments, stating that the full impact of the mortgage rule changes have yet to be felt.
No U.S.-style housing market meltdown for Canada: CIBC – Calgary Herald
While there are a number of concerns regarding Canada’s current housing market, a U.S.-style housing market meltdown is not one of them. A report released on Tuesday by CIBC World Markets revealed that, despite Canada reaching the record debt-to-income ratio the U.S. had in 2006, the Canadian economy plus tighter mortgage lending rules are much better than what the U.S. was faced with before its crash. Benjamin Tal, deputy chief economist at CIBC, says “house prices in Canada will probably fall in the coming year or two, but any comparison to the American market of 2006 reflects deep misunderstanding of the credit landscapes of the pre-crash environment in the U.S. and today’s Canadian market.” Currently, one major concern is current home prices and the recent slowing of sales, which could result in a price adjustment. Continue reading →
A recent poll by CIBC revealed that Canadian mortgage owners believe they will be mortgage-free by 55. But some Canadians have found it’s possible to be mortgage-free sooner if extra steps are taken when making their monthly payments. From the poll, those who have paid off their mortgages in full said they did so by the age 48, seven years earlier than the Canadian expectation! These mortgage-free Canadians used the following strategies to say goodbye to their mortgage sooner.
52% made annual lump sum payments when possible
42% increased the amount of their regular mortgage payments
40% increased the frequency of their mortgage payments
The Canadian Imperial Bank of Commerce (CIBC) is one of the biggest banks in Canada, controlling 13.6% of Canada’s $1.1 trillion dollar mortgage market. Recently, CIBC conducted a poll of over 1000 people across the nation asking for opinions on mortgages. The results yielded a few interesting points.
A) 50% of Canadians said they would choose a fixed rate mortgage today
The spread between fixed and variable rates have shrunk considerably from April 2011 to April 2012 which helps explains why this number is up 11% from last year’s results. Let’s examine how the spread between discounted 5-year fixed rates and 5-year variable rates have changed over the last year.*
A year ago today, the 5-year variable rate was largely favourable to its fixed counterpart due to the large spread. This is a far different cry from how the rates stack up against each other today, where the spread has shrunk to 34 basis points. Plus, it is widely predicted interest rates will increase in the next year (more on that below). Continue reading →
Welcome back to the Ratehub Bank Battle Series: Best Mortgage Campaign. The tournament has seen Scotiabank and RBC advance to the second round so far. The purpose of this Bank Battle is simple – the best mortgage campaign wins. Each competitor will be measured with their latest mortgage ad video available on the web.
Why is this important? There are 5.7 million home owners in Canada representing over a trillion dollars in mortgage business. We are evaluating the latest attempt of each bank to capture market share because mortgage interest is profitable business and more dollars are being put into it every year by house-hungry consumers.
Ladies and gentlemen, hold on to the edge of your seats as we move into the third round of this exciting mortgage calculator battle. The winner of today’s battle will be declared our tournament winner! But that won’t be the end of the road for this champion. Not yet anyway- the champion will face its final challenger, RateHub’s own mortgage payment calculator!That superfight will determine Canada’s best mortgage calculator for 2011!
CIBC has a history as old as Canada itself that spans more than two centuries, with the opening of the Canadian Bank of Commerce in May of 1867 in Toronto. Over the years CIBC has won several awards and gained recognition in a variety of fields. True to our inclusive Canadian spirit, in 2011, CIBC was selected as one of Canada’s Best Diversity Employers. ING Direct (or more formally, the Internationale Nederlanden Groep) is a much newer institution, founded in 1997 and is the underdog in the Canadian mortgage market. ING Canada doesn’t even refer to themselves as a “bank” as they believe they can provide something better than just traditional banking. There are no physical branches, but these savings translate to their customers. Let’s begin Round 3!
With mortgage rates at near historical lows, we thought it would be fun (yes, fun) to face off Canadian banks’ 5-year variable mortgage rates in a fight to the finish. The big banks dominate the market but it was the underdogs, PC Financial and ING Direct that stood out. It just goes to show that volume doesn’t always guarantee the most competitive mortgage product.
The banks battled it out but ultimately, ING was declared the winner with a record low 5-year variable rate of 2.25%. In close second is PC Financial at 2.35% and rounding off third place is Scotiabank’s 5-year variable rate of 2.50%. The winner for June 2011 is ING Direct!
Maybe if banks wanted to be more competitive, they should lay all their cards on the table and post discounted rates.
Take a look at the competition summary.
The ultimate battle is against the lowest rates on the market, which is currently 2.05% on RateHub.ca.
As we move on to the second round of our Mortgage Calculator Battle, we find two of Canada’s banking giants, CIBC and Scotiabank, ready to slug it out. Both banks have provided excellent mortgage payment calculators thus far. The winner of this tournament will face the ultimate test – A one-on-one duel with Ratehub’s very own calculator in a superfight to determine Canada’s best mortgage calculator.
CIBC was formed through the largest merger of two chartered banks in Canadian history, when the Canadian Bank of Commerce and the Imperial Bank of Canada amalgamated. This occurred on June 1, 1961. The company ranks at number 170 on the “Forbes Global 2000 listing”. In 2010, it was named Canada’s Best Consumer Internet Bank by Global Finance magazine.
The Bank of Nova Scotia, commonly referred to as Scotiabank, is Canada’s third largest bank and was founded in 1832. It became the first bank to establish itself in Newfoundland, fifty-five years before the dominion joined the Confederation.
What is a cash back mortgage? This is a type of mortgage where the borrower receives cash back at the time of closing their mortgage. This rebate usually varies amongst lenders from 1% to 5%. The cost of obtaining a cash back mortgage is reflected in its higher interest rate (to make up the difference the lender is fronting to the borrower).
What are the advantages?
The immediate availability of cash maybe useful for those who need extra funds to renovate, decorate, or furnish their home. The cash back can also be used to pay for something such as a wedding or as an investment contribution. Cash back mortgages are most appealing to first-time home buyers seeking to recover closing costs or for borrowers who are transferring their mortgage and are using the cash to pay off the penalties.
What are the disadvantages?
Cash back mortgages have higher interest rates which translate to more interest paid over the life of the term. In most cases, the cash advance is not enough to make up the difference in the extra interest payments.
The internet is the best resource in the world for locating what you need, but due to its vast nature, narrowing the best of something isn’t always easy. Every day, thousands of Canadians search for mortgage calculators. Some are pleased with what they find and others are disappointed. Every major bank in Canada offers their own version of a mortgage calculator. Here at RateHub, we’ll take a look at each one in a head-to-head battle, tournament style – culminating in a superfight against our very own mortgage payment calculator.
The Canadian Imperial Bank of Commerce (CIBC) is the fifth largest bank by deposits, serving over eleven million people worldwide. They are number two in mortgage market share at 13.7% for Q2 in 2011. 
The Royal Bank of Canada (RBC) is the largest financial institution in the country. A quarter of their residential mortgage portfolio is insured mortgages.
Let’s compare both payment mortgage calculators and determine a winner…