Real Estate Changes you Need to Know About……
All home buyers need to be aware that new government rules will be implemented on April 19th, 2010, regarding qualifying criteria for mortgage applications.
If a buyer chooses to take a term fixed between 1-4 years or a variable rate mortgage, they will have to qualify at the higher posted rate indicated by CMHC. This rate is presently 5.35%.
If a buyer selects a 5-year fixed term or longer, they will have to qualify at the term rate. For example, today we have a 5-year fixed rate at 3.69% meaning the buyer would qualify at that rate.
To avoid these mortgage changes, approval on a proposed purchase must be completed prior to April 19th. The closing date can be after the 19th but approval must be in place prior.
This also means that if a client is pre-qualified now, but does not make a purchase until after April 19th, their rate will be honored, but they would have to re-qualify the deal under the new rules.
The following changes are to be made regarding revenue properties:
- 20% down payment instead of 5%.
- 50% rental offset towards mortgage payments, rather than the previous 80%.
The information above is the most recent I have received, and was supplied by Bryce Kirkpatrick of The Mortgage Centre, call him at 403-380-2211 if you have any further questions.
It seems pretty much a foregone conclusion that interest rate will rise this summer, affecting the amount of money buyers can borrow. It was easy to swallow historically low interest rates, but that was too good to last. It’s unlikely rates will rise excessively, but with a more robust economy, higher rates are necessary to keep inflation in check. If you have a variable mortgage, or your term is coming to an end, this may be a good time to lock in your mortgage at today’s low rates.
5-year fixed 3.69%
5-year variable 1.85%
The Best Time to Buy or Sell
Government intervention and interest rates suggest it would be prudent to make that buying or selling decision sooner rather than later.
If you would like further information
I am happy to provide help or advice with the buying or selling of Lethbridge real estate, please view my primary web site at http://www.teammiller.ca, send me an email at info@TeamMiller.ca, or call at 403-329-0479. I look forward to hearing from you.
Sutton Group Lethbridge
1010 3rd Ave S