Changes for Borrowers With The New Mortgage Rules

 The Department of Finance has posted this Q&A on its website.

Mortgage changes concerns for borrowers.

Q. I already have an insured mortgage. How will these changes affect me?
A. Mortgage insurance is good for the life of the mortgage. Borrowers renewing their insured mortgages will not be affected by these changes. For example, if a borrower had a 30-year amortization and there are 27 years remaining on the mortgage, the mortgage can be renewed with a 27-year amortization, as long as no new funds are being added to the mortgage.

Q. What is required to qualify for an exception to the new parameters?
A. The new measures will apply as of July 9, 2012. Exceptions will be made to satisfy a binding purchase and sale, financing or refinancing agreement where a mortgage insurance application has been made before July 9, 2012. While the changes come into force on July 9, 2012, any mortgage insurance applications received after June 21, 2012 and before July 9, 2012 that do not conform to the measures announced today must be funded by December 31, 2012.

Q. Will a purchase and sale agreement dated prior to July 9, 2012 be considered binding if there are outstanding conditions that have not been fulfilled prior to July 9, 2012?
A. Yes, if the date on the purchase and sale agreement is earlier than July 9, 2012, and a mortgage insurance application has been made prior to that date, the new parameters will not apply, even if the conditions of the agreement have not been waived.

Q. Will the new refinancing rules allow a borrower with a mortgage above 80 per cent loan-to-value (LTV) to refinance by extending the amortization period?
A. No. Effective July 9, 2012, borrowers will not be permitted to refinance a mortgage above an 80 per cent LTV, unless the borrower has a binding refinance agreement dated prior to July 9, 2012, and a mortgage insurance agreement has been made prior to that date.

Q. I have a written mortgage pre-approval from a lender, dated before July 9, 2012 with a 30-year amortization. Will I still be eligible for a 30-year amortization if I don’t sign an agreement of purchase and sale until July 9, 2012 or later?A. No, a mortgage pre-approval without an agreement of purchase and sale is not sufficient to qualify for a 30-year amortization. You may have a 30-year amortization only if your agreement of purchase and sale is dated before July 9, 2012 and you have made a mortgage insurance application before July 9, 2012. You may wish to discuss with your lender to revise your mortgage pre-approval using the new parameters announced today.

Q. Will the new parameters apply to assignment (“switch” or transfer) of a previously insured loan from one approved lender to another?
A. No. As long as the loan amount and amortization period are not increased, the new parameters will not apply to a switch/transfer/assignment of the mortgage to a different lender.

Q. If I sell my current home and buy another, will the new parameters apply if I transfer the outstanding balance of my insured mortgage to the new home?
A. As long as the outstanding balance of the insured loan, the LTV ratio and the remainder of the amortization period are not increased, the new parameters will not apply when the mortgage insurance is transferred from one home to another.

Q. What if I need to increase the amount of my insured loan when I sell my current home and buy another?
A. In this situation, the new parameters will apply for any insured loan.

Q. If I bought a condo that is not expected to be built for another two years, will the new parameters apply?
A. If you bought a condo and have made a mortgage insurance application on or before June 21, then the new parameters would not apply. If you buy a condo and make a mortgage insurance application after June 21, the new parameters will apply if the mortgage loan is not funded by December 31, 2012.

http://www.fin.gc.ca/n12/data/12-070_2-eng.asp

Angela Kroemer, AMP
Mortgage Professional
TMG The Mortgage Group Canada Inc.
TMG Sharie Marie Mortgage Team
1.250.650.4182
akroemer@mortgagegroup.com
www.KroemerMortgages.com
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Gifts For Mom- Mother's Day- Sunday May 13 2012

While Mom may not be getting a house for Mother's Day, here is an interesting survey on what Canandians do get mom for Mother's day.
Gifts for mom: Are you as generous as the average Canadian?

TORONTO— The Canadian Press

Published Wednesday, May. 09, 2012 6:00AM EDT

Seventy-three per cent of Canadians are getting mom a gift this Mother’s Day, according to BMO’s 2012 Mother’s Day survey. The average amount we’re willing to spend on mom: $84.16.
Men are true momma’s boys, planning to spend $105 on their mothers. Women, on the other hand, are only willing to shell out $62.

The most generous province? Ontario, where the average spent on a gift is $93.61. The Atlantic provinces spend the least, with a budget of $70.41.

Of course, a bigger gift doesn’t mean a bigger heart.
“The difference in spending is more likely a measure of practicality than it is of love,” said Jennifer Weisman, director, BMO Bank of Montreal.

Mother’s Day is bigger than Valentine’s Day and second only to spending leading up to the Christmas holidays. It typically generates the second highest volume of weekend shopping in the year as measured by dollar value.

So what kind of gifts can mom expect this year? Canadians say they plan to:
– Take mom out to a restaurant (28 per cent). If you plan to take her out for a meal, be sure to make a reservation. Mother’s Day is one of the busiest days of the year for dining out. There was a 22 per cent spike in restaurant spending from the same period the previous month last year.
– Bring her flowers (27 per cent). No surprise here. With spring buds blooming across the country, May is the perfect time to show your love and appreciation with flowers. Last year there was a 237 per cent increase in spending on flowers during the Mother’s Day weekend compared with the same period in the previous month.
– Make her a home-cooked meal (18 per cent). Whether it is breakfast in bed or full-on Sunday dinner, it’s all good, as long as mom doesn’t have to make it.
– Give other gifts or cards (3 to 4 per cent). Aesthetic services, candy and chocolate, jewellery, cards and other gift ideas all trailed far behind the top three choices.
– No gift (15 per cent). Respondents didn’t offer reasons for foregoing a gift, but the numbers were surprisingly high. This could be due to the mother being out of town on holidays, or simply that families celebrate their moms every day and don’t make a practice of observing these types of occasions.

The survey was completed from April 23-26, 2012, using Leger Marketing’s online panel, with a sample of 1,500 Canadians. A probability sample of the same size would yield a margin of error of 2.5 per cent 19 times out of 20.
The Canadian Press

Angela Kroemer, AMP
Mortgage Professional
TMG The Mortgage Group Canada Inc.
TMG Sharie Marie Mortgage Team
1.250.650.4182
akroemer@mortgagegroup.com
www.KroemerMortgages.com -- Check out the special deal on my website.
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