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Tag: residential mortgages Canada

The downfall of Home Capital – a timeline

Courtesy of: Visual Capitalist The downfall of Home Capital Here is a great chart detailing the downfall of Home Capital. As the chart indicates, ultimately the question is whether this is a “one-shot” affair or the start of something more serious. The next mortgage lender of concern is the Equitable Group. Equitable is in many respects very much like Home Capital. The trigger for Home capital was, however, the Statement of Allegations issued by the Ontario […]

Equitable Group financing

Equitable Group adds RBC to syndicate of Canada’s other big banks backing its $2 billion emergency credit line The Equitable Group offers mortgage financing that in many respects is similar to that offered by Home Capital. Borrowers who cannot get financing at Canada’s major banks will turn to Equitable. In order to ensure the availability of financing to the Equitable Group, it has arranged for an emergency credit line as discussed in the article noted […]

Home Capital

One of the most recent and frightening developments on the Canadian real estate scene is the destruction of Home Capital. Home Capital is referred to as an alternative lender, it lends money to house buyers who otherwise do not qualify for a residential mortgage from traditional lenders. In other words, these are high-risk mortgages. Home Capital earns a high rate of return on its funds as a result of higher mortgage rates and a host […]

New cooling measures for the real estate market

Finally, the Government of Canada has stepped in to try and cool the Canadian real estate market. As usual, the real estate agents either claim that these moves will damage the market while others say that it will have no effect. Pick the way that you think it’s going to go. What are my thoughts? It’s quite remarkable to see the spin that the government has put on this. These changes were easy to implement […]

The residential mortgage – easy street for borrowers

I have been trying to figure out if the borrowers are so tight on cash (as reported in many newspaper articles, how do they manage to survive the 5-year renewal? Silly me, it’s just that I don’t understand the rules. Let’s Look at an Example Mortgage Situation To get things rolling, let’s look at an example. I borrow to buy a principal residence and select the 5-year fixed promotional rate of 2.45% (example only). So […]

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