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Is your interest rate too high?

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We’re living in the time of low interest rates. They’re at historic lows, and while no one is sure how low they’ll go – or when they’ll inevitably start to rise – now is the time for you to take advantage of the current mortgage rates and save yourself some cash in the long run. But if you’re in the middle of your mortgage term, refinancing your mortgage in order to get a lower interest rate than what you’re currently paying can mean paying some pretty hefty penalties. Here are some ways to know whether or not your interest rates are too high and whether it’s worth breaking your mortgage to take advantage of best mortgage rates today.
 

  1. Your credit has improved since you first got your mortgage

Your credit report and score are one of the most important factors that a lender looks at when determining your suitability as a borrower for a mortgage. The better a candidate you are, the more attractive interest rates that you get. If your credit was only so-so when you got your mortgage but you’re a few years into your repayments and your credit has improved since then, you can almost certainly get a better rate than what you’re currently paying.
 

  1. You haven’t reviewed your home loan in the past 5 years.

Depending on the length of your current term, you may not have given your loan parameters much thought since you got your mortgage. But even if your financial situation hasn’t changed at all, your mortgage interest rate could be too high. If you’re paying a much higher interest rate than today’s historic lows, then in some instances, you could end up ahead in the long run, even if you have to pay penalties.
 

  1. You have more flexibility in your monthly budget

If you don’t need as much stability as you did when you obtained your mortgage, then you can consider getting a different mortgage option with lower rates. This may be because your income has increased and/or you’re able to withstand a little more uncertainty so you no longer need the safety net of a fixed rate. While variable rate mortgages are typically lower than fixed rate mortgages, the better bet these days the difference a short-term fixed rate mortgage. Depending on where you are, the difference in a 1-year fixed rate mortgage and a 6-year fixed rate mortgage can be more than 1.5%.
 
Whatever you decide, don’t go it alone. Contact your
mortgage broker to discuss your high mortgage interest rate; you may have more options than you think.

 

Related stories:
Canadians may grow tired of low rates
Credit union launches 1.49% mortgage rate

 

 

Are you looking to invest in property? If you like, we can get one of our mortgage experts to tell you exactly how much you can afford to borrow, which is the best mortgage for you or how much they could save you right now if you have an existing mortgage. Click here to get help choosing the best mortgage rate


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Victoria real estate agent disciplined for false advertising, encouraging cash deal to avoid taxes

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A Victoria real estate agent is facing $9,000 in fines and a 60-day licence suspension after breaking several professional rules during the sale of her father’s half-million-dollar property, according to a decision by the Real Estate Council of B.C. 

Whitney Garside’s missteps — outlined this week in a disciplinary decision posted on the council’s website — included falsely advertising the property as being almost twice its actual size and advising the buyer they could avoid the property transfer tax if they paid cash directly to the seller.

The property on Burnett Road in Victoria was being sold in 2016 by the real estate agent’s father. That relationship was disclosed and isn’t among the reasons she has been disciplined.

According to the disciplinary consent order, Garside told the buyer — whose name is redacted — that by paying $42,000 cash on the side, the value of the property could be reduced to avoid paying the property transfer tax.

That cash arrangement was not shared with Garside’s brokerage, Re/Max Camosun, a failure that contravened the Real Estate Services Act.

The council also ruled that she “failed to act honestly and with reasonable care and skill” when she advised the buyer the property transfer tax could be avoided by paying cash directly to the seller. 

The council’s discipline committee also found that Garside committed professional misconduct when she failed to recommend the seller and buyer seek independent legal advice, specifically regarding the property transfer tax and the cash agreement.

Another issue the council considered professional misconduct involved the size of the property in question.

The council ruled that Garside published false and misleading advertising and failed to act with reasonable care and skill when the property was advertised as 8,712 square feet, when in fact a portion of the lot belonged to the Ministry of Transportation, and the actual size was just 4,711 square feet.

The discipline committee ordered Garside’s licence be suspended for 60 days, which will be completed Jan. 3, 2021.

She has also been ordered to complete real estate ethics and remedial classes at her own expense.

Garside was also fined $7,500 as a disciplinary penalty and $1,500 in enforcement expenses.

She agreed to waive her right to appeal the council’s discipline committee’s decision in September.

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Frisco apartment community sells to Canadian investor

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A Canada-based investor has purchased a Frisco apartment community as part of a larger Texas deal.

The 330-unit Satori Frisco apartments opened last year on Research Road in Frisco.

BSR Real Estate Investment Trust bought the four-story rental community that was built by Atlanta-based Davis Development.

Satori Frisco was more than 90% leased at the time of sale. The property includes a two-story fitness center, a car care center, a dog park and a resort-style swimming pool.

The Frisco property sold along with Houston’s Vale luxury apartments in a deal valued at $129 million.

“BSR recently exited the smaller Beaumont and Longview, Texas, markets and also sold noncore properties in other markets,” John Bailey, BSR’s chief executive officer, said in a statement. “We are now using our strong liquidity position to invest in Vale and Satori Frisco, modern communities in core growth markets with the amenities our residents desire.”

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House prices on Prince Edward Island continue steady climb

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Residential real estate prices on Prince Edward Island continue to climb at a rate higher than the national average, according to the latest report from a national organization. 

The Canadian Real Estate Association released monthly figures for November 2020 on Tuesday.

They show that the average price for a resale home on P.E.I. is about 21 per cent higher than it was a year earlier. 

Only Quebec had a bigger year-over-year increase, at about 23 per cent. Overall across Canada, prices were up 13.8 per cent year over year in the ninth month of the COVID-19 pandemic.

“For the fifth straight month, year-over-year sales activity was up in almost all Canadian housing markets compared to the same month in 2019,” the report noted.

“Meanwhile, an ongoing shortage of supply of homes available for purchase across most of Ontario, Quebec and the Maritime provinces means sellers there hold the upper hand in sales negotiations.”

That lack of houses coming onto the market compared to the demand means that in those provinces, there is “increased competition among buyers for listings and … fertile ground for price gains.”

There have been anecdotal reports for months that Prince Edward Island’s low rate of COVID-19 infection and looser rules around social activities have been encouraging people to buy homes on the Island. 

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