Tag Archive for “financing”

During the second quarter of 2011, the industrial real estate market in Montreal experienced significant gains, which is important, as the sector had been one of the hardest hit during the recent recession.

A report from CB Richard Ellis revealed that Montreal's market represented more than half of the country's positive net absorption of industrial space during the year's second quarter. In all, 6 million square feet was sold through commercial mortgages or leased – 3.7 million of which were in Montreal.

"We dug ourselves out of a hole," said Brett Miller, executive vice president and regional managing director for CBRE in Eastern Canada. "We were surprised by the strength of the absorption. It surpassed our expectations."
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Entering into a binding contract is something you probably do more than your think, and think about less than you should. Virtually any time you apply for credit or financing you are entering into a contract, the elements of which you need be cognizant of.

The Financial Consumer Agency of Canada recommends consideration of the following steps before entering into a contract:

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Finding the right home for you and your loved ones really comes down to three chief factors:

1. Affordability: Does the home fit into your budget? Have you determined the financing you can qualify for through a mortgage pre-approval? Have you factored in mortgage insurance, utilities and heating expenses, association fees and taxes?
2. Lifestyle: Is the home located in an area within the proximity of the amenities you and your family require? Is the lot large enough for your pet(s)? Will owning this home impede you from doing the things you love doing? Are you close enough to work, family and friends?
3. Future Needs: Are kids a possibility in the not so distant future? Is the home large enough for a family? Is the basement developed? Are there schools nearby? Or, if you are close to retirement, is the home too large? Are there too many stairs and floors in the home to negotiate?

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35-Year Amortization in Debate

Rumors that the Government of Canada’s Finance Department is musing the possibility of dropping the maximum amortization from 35 years to 25 years are sparking discussion among financial experts and potential mortgagers.

The year before last the government decided to cut back amortizations on high ratio loans (loans that require financing of 80 per cent or more of the mortgaged property’s value) from 40 years to 35 years. Lessening the overall time homebuyers have to pay their mortgage loan back would decrease the amount of Canadians who could potentially qualify for mortgage financing. But is it in their best interest?

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Lease verses Finance

Should you lease or buy? Which is best for you? Well, it depends. It depends on your lifestyle, your current and future financial status, and whether you want to own your vehicle as opposed to having that new car smell every couple of years.

To help us along, here are the main points:

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Energy-Efficient Properties Eligible for Premium Discount

Amassing the 25 per cent down payment that most commercial mortgage products require for commercial properties can be difficult. But with the Canada Mortgage and Housing Corporation’s multi-unit (5+ units) insurance coverage, a commercial investor can attain up to 85 per cent financing toward their commercial purchase. This includes financing and coverage for retirement dwellings, licensed care facilities, condominium construction and student residences, new or existing, Canada-wide.

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Green Developments Receive Federal Funding

A south Ottawa community has been named as the second of six winners that will receive federal development funding toward their sustainable community development project. In a national push to raise environmental standards and encourage energy efficiency, the Canada Mortgage and Housing Corporation(CMHC) and Natural Resources Canada(NRC), under the Government of Canada’s ecoACTION program, launched its EQuilibrium Communities Initiative in June, 2009.

Equilibrium is a three-year, $4.2-million national competition that will “select projects that will work to improve community planning and develop healthy sustainable communities that are energy-efficient”.

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The option to own your own home with 100 per cent financing, or even more in some cases, seems like a great deal. There is no need to accumulate the standard minimum five per cent down because that too can be financed. If the rules on qualification are stringent, including proof of solid credit rating and significant income, why are some banking professionals claiming “dismay” at the rising issue of no money down mortgage products?

For starters, some feel that the increased availability of home ownership to a pool of buyers that have not saved to put down equity into their home purchase will contribute to bubbling housing issues and inflation.

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The Canadian commercial lending market continues to see change in the way it functions. In 2009 commercial lending saw a dip, which appears to be recovering this year due, in part, to a renaissance of securitization.

Though, according to the Globe Investor, Canada’s securitization market continues to see issuance levels lower than before the 1930s, issuance is improving. Foreign lenders, outside of large banks and insurance companies, are upping the commercial financing available for non-prime commercial borrowers, which means the outlook for the Canadian commercial mortgage market looks apt to see growth.

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Your credit score, also referred to as a Beacon or FICO score, is one of the weightier elements used by lenders to determine your eligibility to receive financing and to decide the rate they feel justified in charging you on your mortgage. Beacon scores tend to range from 300 to 900; 900 being perfect and very uncommon.

The average Canadian scores around the 700 mark. This grade, or greater, will secure you the best mortgage rates in Canada. For every ten points below 700 you are basically looking at a hike of one or two basis points, or 0.01-0.02 per cent, on the rate you are offered, down to 600 points. Below 600, down to 500, rates start spiking one to three full percentage points above the best rate available and qualification becomes more difficult, though not impossible.

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