Mortgage Broker

[Sylvanfan]

^^^
It is pretty much criminal how poorly informed they allow people to be when purchasing a house. It's crazy how people will research a vehichle to the ends of the Earth before they make a decision. But with a mortgage...meh, it's fine!

Although, I did once deal with a mortgage broker and I don't think she knew what she was really doing. I ended up paying the penalty on my old mortgage, than got the same mortgage from the same lender (who happened to be a major bank) and didn't get credited back the payout. I figured this out afterwards and went to the bank the next time and asked for all this and to have all the fee's waived and they did it.

So really don't use any mortgage broker....Use a GOOD Mortgage broker who knows their stuff! Of which I'm sure you are.

[Bagor]

Originally Posted by Mike Oxlong

It's amazing what some banks try to get away with.

No kidding.

Before we got a broker it was a bit of an eye opener.

Had the 5.45% is the absolute best we can do for you talk. Replied with such and such bank are offering us 5.25 (total BS). An awkward moment. Bank person asks us to wait a minute. Goes and takes a quick dump and comes back saying that after talking with their boss they can match the other banks offer. So much for best and final offer.

My advice: Use a broker but if you're determined to do it yourself with the banks, get your BS head on and fill them with as much BS as they're filling you. Play them off against each other. NEVER believe a word they're telling you.

Don't talk to me about banks. I've got a great story on another dealing (totally off-topic) that starts with a employee screaming down the phone at me at 8am (who the hell phones at 8am?) and finishes with me standing at the phone with a dictophone 2 days later to record the BS they were feeding me. Why the dictophone? When I asked them to clarify in writing by e-mail the BS information from the phone, I got no reply. Knew that they were going to try and deny it all later which they did.

[Ardor]

PM sent

[loob job]

So if variable mortgage rates are tied to prime, if prime goes up by .25 then will the variable rate go up exactly the same?

[Mike Oxlong]

Originally Posted by loob job

So if variable mortgage rates are tied to prime, if prime goes up by .25 then will the variable rate go up exactly the same?

Yes.

If you have a variable mortgage at prime you are currently paying 4.75% (which is too high for a variable rate). If it goes down by .25% your new interest rate will be 4.50% And vice versa if rates go up.

[Mike Oxlong]

Just an FYI for everyone. The big banks are starting to raise their long term fixed interest rates.

They predict variable rates will remain the same or fall over the next few months but they are already bumping up the fixed rates.

http://money.canoe.ca/News/Sectors/B...878781-cp.html

One thing. The rates quoted in the article at like 7.05% for a 5 year fixed are ridiculous. You don't have to pay anywhere near that.

[Sample00]

thanks for the headsup.
any idea why the long term fixed rate increase, besides wanting to pad their margin?

[Mike Oxlong]

From the article: (They seem to be able to explain it better than I can)

"The changes suggest bond markets are worried about the future inflationary pressures from the proposed US$700 billion U.S. government bailout of Wall Street banks, said TD Bank chief economist Don Drummond.
"We always did figure that adding $700 billion to the deficit of the United States would probably cause something like a 25 basis point (quarter point) increase in the longer-term interest rates and that seems to have already happened," said Drummond.
"(The bailout) does increase the risk to bonds. In just plain good old demand and supply that means there has to be an awful lot of bond issuance and there's a limited supply of people that want to buy them so it's natural that the price goes up," he added.
The interest rates on mortgages and other short-term borrowing are set based on the price of bonds. With lower demand for bonds and fears of inflation, rates have to rise to lure investors willing to part with their money.
Other interest rates in the economy - from consumer and car loans to mortgage rates tied to the prime rate - are affected by the Bank of Canada trend-setting rate, which is expected to fall or remain stable over the next few months at least.

[MJK]

I am thinking about buying a property in the US...anything you can do for me here or do I have to go through someone in the US?

[Mike Oxlong]

Hey there,

Sorry for the really late reply on this.

Nothing I can do for you with US properties. You need to find a mortgage broker down in the US.

I am looking at buying something down there as well and I have been speaking with some US brokers already.

[Bobblehead]

If your mortgage is coming due, at what point should I be speaking to a mortgage broker to figure out who gets my future business?

[Mike Oxlong]

Well I would call my clients about 3 months in advance of the renewal date. Chances are your bank will be sending you a letter around 3 months ahead of time as well. Whatever you do don't sign the renewal letter they give you. A mortgage broker will most likely be able to get you a better deal.

Let me know if you have any questions when yours comes up for renewal. I can let you know if they are offering you a decent rate or not.

[Mike Oxlong]

Some AMAZING rates available right now.

3.75% on a 3 year fixed
4.39% on a 5 year fixed.

These are quick close specials but there are all types of good deals in the market right now......

[old-fart]

Question for you Mr. Oxlong... I'm considering converting my existing mortgage into a HELOC. Without getting into specific details lets just say I have more than enough equity in the house to make it a non-issue (currently less than half the equity in the house is in the mortgage).

So, for argument sake, a $250K house with less than $115K mortgage. Flip the mortgage into a HELOC.

My thoughts on this are as follows:
1) I would get the HELOC for the amount of the mortgage plus a little... like $120K, not for the full 75% or whatever of the house value. Close out mortgage with funds from HELOC. HELOC becomes only debt (no car loans or credit card payments, etc).
2) Have my paycheck deposited into the HELOC account.
3) Withdrawl funds from HELOC throughout the month ala a checking account. Ensure that at the end of the month the amount owing on the HELOC is less than the amount owing at the start of the previous month, and track that progress towards retirement of said HELOC.

In effect, make the HELOC my own personal "Manulife ONE" account. Why not just get a Manulife ONE you ask? They are currently at 5.1%, I can get a HELOC for prime +1% at the worst. My current mortgage is 5.15%.

Comments?

[Mike Oxlong]

That seems like a great plan. The only thing is you have to be really disciplined and make sure that you aren't spending more than is coming in.
If you make sure that HELOC balance is going down every month then you are looking good. Whatever extra you can put on your mortgage or HELOC to pay it off early is going to save you a lot of cash down the road.

[troutman]

Bring lots of cards to the CP Networking meeting.

[SportsJunky]

Originally Posted by old-fart

Question for you Mr. Oxlong... I'm considering converting my existing mortgage into a HELOC. Without getting into specific details lets just say I have more than enough equity in the house to make it a non-issue (currently less than half the equity in the house is in the mortgage).

So, for argument sake, a $250K house with less than $115K mortgage. Flip the mortgage into a HELOC.

My thoughts on this are as follows:
1) I would get the HELOC for the amount of the mortgage plus a little... like $120K, not for the full 75% or whatever of the house value. Close out mortgage with funds from HELOC. HELOC becomes only debt (no car loans or credit card payments, etc).
2) Have my paycheck deposited into the HELOC account.
3) Withdrawl funds from HELOC throughout the month ala a checking account. Ensure that at the end of the month the amount owing on the HELOC is less than the amount owing at the start of the previous month, and track that progress towards retirement of said HELOC.

In effect, make the HELOC my own personal "Manulife ONE" account. Why not just get a Manulife ONE you ask? They are currently at 5.1%, I can get a HELOC for prime +1% at the worst. My current mortgage is 5.15%.

Comments?

I'm pretty sure the Manulife One base rate is 3.75% right now.

[old-fart]

Originally Posted by SportsJunky

I'm pretty sure the Manulife One base rate is 3.75% right now.

Huh... you're right, but I swear I checked last week (or maybe the week before) and it was higher.

Unless I'm just losing it, which is also possible.

Still, given the fees for both setup and monthly that Manulife charges, plus considering the lack of bank machines, etc. I think I'd be better off with my existing bank and the HELOC outlined above (my own personal Manulife ONE). $150 total fees to setup (including legal, transfers, everything), no monthly fees, bank machines everywhere.

Thanks for pointing out the new rate though, I'll use that when negotiating with my bank...

[SportsJunky]

Originally Posted by old-fart

Huh... you're right, but I swear I checked last week (or maybe the week before) and it was higher.

Unless I'm just losing it, which is also possible.

Still, given the fees for both setup and monthly that Manulife charges, plus considering the lack of bank machines, etc. I think I'd be better off with my existing bank and the HELOC outlined above (my own personal Manulife ONE). $150 total fees to setup (including legal, transfers, everything), no monthly fees, bank machines everywhere.

Thanks for pointing out the new rate though, I'll use that when negotiating with my bank...

I'm in no way trying to sell you on Manulife One (even though it is what I use) but I just wanted to point out that they eat the legal fees - not you. They charge 14 dollars a month for everything.

You are right though, the big drawback is the bank branch/atm locations. Great Western seems to be popping up in more communities though and they are part of the growing Manulife Exchange Nnetwork.

Good luck.

[Slava]

Originally Posted by old-fart

Huh... you're right, but I swear I checked last week (or maybe the week before) and it was higher.

Unless I'm just losing it, which is also possible.

Still, given the fees for both setup and monthly that Manulife charges, plus considering the lack of bank machines, etc. I think I'd be better off with my existing bank and the HELOC outlined above (my own personal Manulife ONE). $150 total fees to setup (including legal, transfers, everything), no monthly fees, bank machines everywhere.

Thanks for pointing out the new rate though, I'll use that when negotiating with my bank...

I just wanted to point out that there are no set-up fees for the Manulife One account...not that this addresses all of your concerns though!