Rates remained unchanged since last week; best 5y fixed 3.39% ; Bank of Canada will announce rate decision … From Td Economics - Canada • This week, areas of Southern Alberta and Ontario dealt with the aftermath of downpour and widespread flooding. The worst of the episodes appears to be in the rear view mirror – the emergency status in High River, Alberta was lifted yesterday and virtually all residents in Southern Ontario have regained power. Rebuilding, renewal and healing remain on tap. • On the economic front, there were two major data releases on the Canadian calendar. Canadian new homebuilding stabilized at 200K units on a seasonally-adjusted, annualized basis in May. On a six-month basis, new home starts are averaging about 184K. • The Bank of Canada also issued its Summer 2013 Business Outlook Survey this week. Canadian firms remain quite cautious when it comes to future sales growth prospects and investment intentions. They seem to be waiting for the economic outlook to improve which looks to be in the cards in the second half of the year and into 2014 What you need to know about mortgage qualifications: · Unsecured credit lines & credit cards: For these debts, “No less than 3% of the outstanding balance” must be included in monthly debt payments. Advise clients to reduce balances… · Secured lines of credit: determine monthly payments based on “the outstanding balance amortized over 25 years at a 5-year Benchmark rate (5.14%) .Again, interest-only payments are no longer allowed for debt ratio calculation purposes. · Heating costs: advise to obtain the “actual heating cost records” of a property. When no such history is available, the heat expense used in debt ratio calculations such as (square footage x $0.75) / 12 months ; this double or triple cost !!! it’s better to advise client about “real” heating cost… · For rental income: If a borrower owns other non-owner occupied rental properties, the principal, interest, property taxes and heat (P.I.T.H.) on those properties must either be: o deducted from gross rent revenue to establish net rental income; o Included in ‘other debt obligations’ when the Total Debt Service (TDS) ratio is being calculated; or o Rental worksheet can be used to calculate the rental property Debt Service Ratio Bank of Canada Interest Rate Decision - Overnight rate will remain the same Release Date: July 17, 2013 Current Rate: 1.00% TD Forecast: 1.00% Consensus: 1.00%
Posted on: Wed, 07 Aug 2013 14:08:05 +0000
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