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The lowest advertised uninsured fixed rates in Canada mostly climbed this week, by four to eight basis points. Joe Raedle/Getty Images The lowest advertised uninsured fixed mortgage rates in Canada mostly climbed this week, by four to eight basis points. Popular two-year fixed rates, which attract people who want to lock in for a few years and refinance when the Bank of Canada cuts rates, jumped 22 bps. As for the lowest insured fixed rates, they mainly held steady. The exception was one-year and two-year terms, where Quest Mortgage launched new market-leading offers of 4.99 per cent. Variable rates didn’t move this week. They will remain steady until the central bank presumably increases interest rates again on Dec. 7 and pushes some borrowers closer to their trigger rate. Last, but not least, are rates for home equity lines of credit, where Tangerine finally pulled its stellar offer of prime rate minus 0.1 per cent, which it has featured since 2019. The lowest-cost widely advertise...

Private mortgage lenders are having a harder time accessing capital and are making it more difficult for borrowers to get a loan, choking off a major source of funds for those unable to qualify at a Canadian bank. Some private mortgage lenders, also known as alternative or subprime lenders, are requiring borrowers to have higher down payments or more equity in their homes to qualify for a private mortgage. The higher standards are being rolled out as Canadian banks clamp down on lending in the face of falling home prices and rising interest rates. That has sent a flood of new borrowers to private lenders and shored up their business. MCF Mortgage Investment Corp., which provides loans to Ontario homeowners, had to suspend new loan applications for two weeks in October because it was inundated with new borrower applicants. As a mortgage investment corporation, or MIC, the lender uses capital from investors, as well as funds that have been repaid by its borrowers to provide new mortgag...

Canadians have been slow to turn away from variable-rate mortgages despite a slew of central bank interest rate hikes since March. It’s an unusual trend that mortgage brokers chalk up to economic uncertainty, regulations and – for some borrowers – a need for flexibility. As of August, variable-rate mortgages still accounted for 44 per cent of new mortgages, mortgage renewals and mortgage refinances, according to an October briefing by housing analyst Ben Rabidoux for Mortgage Professionals Canada, the country’s national mortgage broker industry association. What is your mortgage trigger rate? This calculator helps you estimate it Calculator: See how rising interest rates will affect the cost of your mortgage That share was down from a January peak of 57 per cent but still twice as high as levels seen before the pandemic, according to the report. And even after two more rate increases by the Bank of Canada, in September and October, some mortgage professionals report a significant sha...

Canada’s housing downturn decelerated in October, with home sales rising slightly and prices levelling out. But the volume of activity was depressed and economists warned that home prices would continue to fall as borrowing costs soar. The number of resales rose 1.3 per cent from September to October, according to the Canadian Real Estate Association (CREA). That was the first rise in monthly sales since February, when Canada’s central bank was about to embark on its campaign to slash the supply of cheap money. At the same time, the national home price index fell 1.2 per cent to $777,200 from September to October after removing seasonal influences, according to CREA. That was the smallest monthly drop since June, though the eighth consecutive month of price declines. Over all, October’s activity was 15 per cent below the prepandemic monthly average. Bank of Montreal senior economist Robert Kavcic described the Canadian housing market as depressed and forecast further price decreases ...

Bank of Canada senior deputy governor Carolyn Rogers takes part in a news conference in Ottawa, on Oct. 26. PATRICK DOYLE/Reuters Recent homebuyers with variable-rate mortgages will find the adjustment to higher interest rates more painful, said Bank of Canada senior deputy governor Carolyn Rogers. Speaking before the networking group Young Canadians in Finance in Ottawa Tuesday, the senior deputy governor said the share of households with a variable-rate mortgage has increased over the last year. These mortgage holders are especially affected by interest rate hikes. “Mortgage costs for some Canadians have already increased, and they will likely increase for others in time,” Rogers said, according to her prepared remarks. Housing activity boomed during the pandemic as Canadians rushed to take advantage of low interest rates. Now, as interest rates climb back up, recent homebuyers with variable-rate mortgages are seeing their borrowing costs go up. New research from the Bank of Canada...

Homes on Sherman Brock Circle in Newmarket, Ont. on Mar 30, 2021. Fred Lum/the Globe and Mail Canada’s financial system should be able to weather a period of heightened stress, but many recent home buyers could experience a “painful” squeeze as interest rates continue to rise, the Bank of Canada’s second-in-command said Tuesday. In a speech in Ottawa, senior deputy governor Carolyn Rogers said long-standing vulnerabilities in Canada’s housing market worsened through the COVID-19 pandemic as home prices soared and buyers increasingly relied on variable-rate mortgages, which are linked to the central bank’s benchmark lending rate. Now that interest rates are rising and home prices are falling, many of these home buyers are experiencing a nasty adjustment, Ms. Rogers said. The most common variable-rate product has fixed monthly payments. With every interest rate hike, more of the borrower’s monthly payment goes toward interest. However, when the monthly payment no longer covers any prin...

For women and marginalized groups, going for after-work drinks with other employees isn't always comfortable. istock Getting caught up on a week that got away? Here’s your weekly digest of The Globe’s most essential business and investing stories, with insights and analysis from the pros, stock tips, portfolio strategies and more. Not everyone wants to go for after-work drinks Since the days of Mad Men , going for after-work drinks with your co-workers and boss has long been seen as a way for company employees to network and bond. But as Sarah Micho writes, for women and other marginalized groups, this common social practice isn’t always inclusive. Employees may not drink for a variety of reasons, including religious or cultural beliefs, health and substance and abuse issues. Whatever the reason, the consequences of opting out may go beyond missing a social occasion. It can create barriers to professional growth and advancement, which is why it’s time for company leaders to rethi...

More retirement-age Canadians are still paying off a mortgage, and financial advisers say rising interest rates will make it even more challenging for Canadians to pay off their home before they retire. The number of people older than 65 with an outstanding mortgage in their residence increased from 1.2 million to 1.5 million between 2016 and 2021 according to Statistics Canada, although the agency noted they don’t measure whether others residing in the home are contributing to mortgage payments. However, the number of seniors living alone with a mortgage also grew, from roughly 181,000 to 220,000 in the same time frame. Canada Mortgage and Housing Corp. data also showed an increase in the share of people aged 65 and older with a mortgage. People in that age group accounted for 10 per cent of mortgages in 2017, and 13 per cent of mortgages in 2022. The age group also accounts for 9 per cent of the country’s outstanding mortgage balance, compared with 7 per cent in 2017. Furthermore, ...

A home for sale in the Rosedale neighbourhood in Toronto on June 21, 2012. Fred Lum/Tausi Insider The share of mortgages with ultralong amortization periods has rapidly increased to about 30 per cent of home loans at some of Canada’s biggest banks, another sign borrowers are struggling with higher interest rates. At Bank of Montreal, the proportion of residential mortgages with amortization periods longer than 30 years reached 31.3 per cent last month. At Canadian Imperial Bank of Commerce the share was 30 per cent and at Royal Bank of Canada it was 27 per cent, according to the three lenders’ latest quarterly results, released this week. That is up from the end of July, when 30-year-plus mortgages accounted for one quarter of each of the three banks’ residential mortgage portfolios. And the July numbers were a significant increase from the end of April, when those loans made up 10.6 per cent of BMO’s portfolio and 12 per cent of mortgages at RBC and CIBC. In October, 2021, before t...

National Bank of Canada no longer allows customers to transfer their existing mortgages after purchasing new properties, meaning clients hoping to move to new homes can’t hold on to low interest rates locked in before the recent surge in borrowing costs. The change, which applies nationwide, was implemented on June 30 as part of “a regular review” of the bank’s service offerings, National Bank spokesperson Alexandre Guay said in an e-mail. The lender did not answer a question about whether it had alerted clients who might be affected by the decision, but Mr. Guay noted that the move “did not involve any modifications to mortgage contracts, which must be communicated formally.” In an e-mail to a borrower reviewed by Tausi Insider, National Bank said it had stopped offering rollover mortgages, which it described as a “financing solution” that allowed borrowers to transfer the interest rate, remaining balance and remaining term of an existing mortgage to a new loan. The feature, which i...

RBC is buying HSBC's Canadian unit in the largest domestic banking deal on record. Duane Cole/Mark Blinch/Tausi Insider Getting caught up on a week that got away? Here’s your weekly digest of The Globe’s most essential business and investing stories, with insights and analysis from the pros, stock tips, portfolio strategies and more. RBC buys HSBC Canada in the country’s largest bank deal Royal Bank of Canada is buying HSBC Bank Canada for $13.5-billion in the biggest domestic banking deal on record, bolstering RBC’s position as the country’s largest institution in the industry. As James Bradshaw reports, Canadian banks have been eyeing the transaction for years. HSBC Canada, a subsidiary of Britain-based giant HSBC Holdings PLC and the seventh-largest bank in the country by assets, has strengths in commercial lending and mortgages and has been consistently profitable. If approved, the deal would extend RBC’s lead over competitor banks by tens of billions of dollars in both loan...

CIBC reported a shrinking net interest margin, falling seven basis points quarter-over-quarter. Fred Lum/Tausi Insider Nine months into a supercharged cycle of interest rate hikes, Canada’s largest banks are starting to benefit from higher loan margins. Canadian Imperial Bank of Commerce CM-T, however, is not, and confusion over why the lender is such an outlier is hitting its share price. For years, Canada’s banks have stressed that rising interest rates would not be disastrous for their bottom lines. Although their blistering loan growth would likely slow, executives said the lenders could make more money off each individual loan. As rates rise, loan margins – or the amount made per loan – tend to increase. That scenario is now playing out for heavyweights such as Royal Bank of Canada RY-T and Toronto-Dominion Bank TD-N. The lenders reported net interest margins – a measure of the difference between what it costs a bank to borrow money and the rate at which it lends that money out ...

The seventh and final Bank of Canada interest rate hike of 2022 overshadows some encouraging news for people with a mortgage coming up for renewal. Fixed-rate mortgage costs take their cue from what’s happening in the bond market, where the prevailing view is that we’ve seen the worst with inflation. Rates in the bond market have fallen sharply in recent weeks, which means we could see lower fixed mortgage rates before too long. The latest increase in the Bank of Canada’s overnight rate means higher costs for variable-rate mortgages, but there’s a positive spin here, too. If we haven’t reached the peak for the overnight rate, we are darn close. Whether you’re a borrower, a saver or a conservative investor interested in guaranteed investment certificates, we are very close to an inflection point on rates that requires fresh thinking. Savers and GIC investors, we’ve likely reached the “as good as it gets” point. Borrowers, your job is to endure until rates decline. For now, there is th...