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Board of Trade Poll Supports Cross-Regional Agency for Transit





Seventy-four per cent of Torontonians who responded to a survey support the idea of a developing a super regional transit agency to oversee planning, building and operating both regional and local transit services across a wide swath of central Ontario.

That’s according to the Toronto Region Board of Trade (BofT), which has just released the results of its recent survey (.pdf) of residents of the Greater Toronto and Hamilton area, Waterloo Region, and Guelph about its proposal for a super transit agency to operate all transit services in the area.

As Urban Toronto reported last November, the BofT has developed a concept paper that encourages the Government of Ontario to expand the mandate of Metrolinx by uploading all transit services in the area to new entity, which it’s calling “Superlinx”. The new cross-regional agency would be similar to those in other large conurbations, such as Transport for London and Vancouver’s Translink. The goal, the BofT says, is to finance and build transit lines more quickly, offering commuters a modern, seamless transit system.

The board commissioned Environics Research to conduct the survey. Environics worked with an on-line sample-panel provider to reach out to what it calls “a representative group of Ontarians, according to census population distribution”. BofT officials explained to Urban Toronto that “Because it is an online sample, it is not ‘random’ in the same sense that a telephone sample is considered, but respondents were drawn randomly from a larger pool of residents.”

Results of the Board of Trade poll on the Superlinx plan, image, Board of Trade

The team polled 1,000 adults across the area; 27 percent of them from the 18-34 age group, 35 percent from the 35 to 54 group and 38 percent 55 years of age or older. Of this total, 43 percent own a car; 35 percent have two cars; ten percent have three or more cars; and just 13 percent have no car. But, even more important, 50 percent of the survey participants regularly ride public transit.

While the poll determined a moderate level of satisfaction for local transit services, respondents also indicated an equally moderate enthusiasm for the Superlinx plan. People in Peel Region had the highest opinion of local transit at 79 per cent of respondents, while people in Toronto and York Region had the lowest opinion–59 and 55 percent respectively. Perhaps not surprisingly, York residents demonstrated the highest level of support for the Superlinx concept—89 per cent of York respondents agreed with the proposal, while Hamiltonians were the least interested in it—just 65 percent of them approved. However, in fact, 79 per cent of regional respondents supported the concept of a single regional transit agency funded by the provincial government.

According to the BofT, “Toronto is one of the fastest growing metropolitan areas in North America, a vibrant, global city, consistently ranking among the world’s top cities for quality of life. However, once deemed an enviable strength, the region’s transit system has become a significant weakness. Congestion is getting worse as more residents commute regionally across multiple lines. We require a regional transit agency with the authority to integrate the one million residents who have moved into the region over the past 10 years, and the millions more arriving in the coming decade.”

Profile of the who participated in the Board of Trade’s poll, image, Board of Trade

That’s the rationale that inspired the Bof T to develop its Superlinx plan. Its concept paper, Superlinx: An Uploading Strategy for a Modern Provincial Transit Agency (.pdf) states that the “Superlinx agency will have authority over transit planning, operations, expansion and asset management. Consolidation will allow the agency to improve services, find efficiencies and maximize the value of its assets.” The report’s authors declare that this “proposal also has the virtue of simplicity, avoiding the co-ordination problems created by partial uploads of only planning authority or rapid transit lines.”

The survey comes at a time when the Government of Ontario is exploring options to do just that—upload Toronto’s subway system, but only the subways—as it promised during the 2018 provincial election. The Board supports a subway upload only as a first step leading developing a more regional model over time.

“We’ve spent twenty years urging the province to move growth revenues, financing capacity and planning authority down to cities to get transit built faster, and it hasn’t worked,” said Jan De Silva, President and chief executive officer of the board. “It’s time to try to upload transit responsibility to the province instead, since that’s where growth revenues, planning authority, and financing capacity already exist.”

The BofT claims that Superlinx would transform transit in our region, leading to numerous benefits for riders, taxpayers and governments, integrating fares and schedules. However, municipal politicians and transit activists worry about losing local control over where transit services go and how frequently service is available.

In an article by transportation writer Ben Spurr, the Toronto Star quoted Toronto Councillor Gord Perks who exclaimed when the BofT originally revealed its plan last year, “I don’t see for the life of me why someone appointed by the province of Ontario should be deciding on the frequency of the Dufferin bus.”

Model of proposed Superlinx board of directors, image Board of Trade

Brian Kelcy, the board’s vice-president of public affairs and one of the authors of the Superlinx concept paper, countered concerns about the loss of local control. He said that when he spoke with people around the region about the proposal, they reacted in opposite ways, depending on where they lived. While Torontonians were concerned about losing control of transit to other areas of the province, people outside Toronto worried about losing control to Toronto.

In terms of the structure of the Superlinx board, the BoT proposes that “at least half of all of its members will be independent, non‐executive directors (INEDs). These directors would include business leaders and transit experts, as well as representatives of private capital who invest in the agency’s commercialization efforts.” The remaining positions would be appointees from the provincial and municipal governments, with most being from the province.

Superlinx would be responsible for all public transportation in the large geographical area combining the “census metropolitan areas” (CMAs) of Guelph, Hamilton, Kitchener-Waterloo-Cambridge, Oshawa and Toronto. (Statistics Canada defines a CMA as an “area consisting of one or more neighbouring municipalities situated around a core. A census metropolitan area must have a total population of at least 100,000 of which 50,000 or more live in the core.”)

Urban Toronto asked Kelcey why the Superlinx realm wouldn’t include other nearby areas, for example, the rest of Niagara Region, Barrie and northern Durham Region. He said that the Board of Trade had defined the Superlinx area due to its many years of observing vehicle and goods movements throughout the zone. He did admit that some early models of the Superlinx zone contained these adjacent areas, which, in most cases, are already receiving GO Transit train service or will be welcoming GO trains in a few years.

The Superlinx zone would include a large area in Central Ontario, image, Board of Trade

A final point about polls. In September, 2017, TTC staff reported (.pdf) the results of the agency’s latest customer satisfaction survey. They declared that the “high perceptions of overall customer satisfaction with the TTC” (82 percent) continued and were in line with previous results.” (BofT pegs the Toronto satisfaction level with local transit at only 59 percent.) On the other hand, earlier this year, the City of Hamilton surveyed more than 22,000 residents by telephone and on-line to help the city better understand the needs and perceptions of its clients. Just 39 percent rated their local transit service as “good” or better—this is a lot lower than the 66 percent satisfaction rate that the BoT survey determined for Hamilton.

What do you think of the Superlinx plan? Leave your comments in the form below, or join the discussion on our forum.


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Real Estate

Mortgage insurance vs. life insurance: What you need to know





Your home is likely the biggest asset you’ll ever own. So how can you protect it in case something were to happen to you? To start, homeowners have a few options to choose from. You can either:

  • ensure you have mortgage protection with a life insurance policy from an insurance company or
  • get mortgage insurance from a bank or mortgage lender.

Mortgage insurance vs. life insurance: How do they each work?  

The first thing to know is that life insurance can be a great way to make sure you and your family have mortgage protection.

The money from a life insurance policy usually goes right into the hands of your beneficiaries – not the bank or mortgage lender. Your beneficiaries are whoever you choose to receive the benefit or money from your policy after you die.

Life insurance policies, like term life insurance, come with a death benefit. A death benefit is the amount of money given to your beneficiaries after you die. The exact amount they’ll receive depends on the policy you buy.

With term life insurance, you’re covered for a set period, such as 10, 15, 20 or 30 years. The premium – that’s the monthly or annual fee you pay for insurance – is usually low for the first term.

If you die while you’re coved by your life insurance policy, your beneficiaries will receive a tax-free death benefit. They can then use this money to help pay off the mortgage or for any other reason. So not only is your mortgage protected, but your family will also have funds to cover other expenses that they relied on you to pay.

Mortgage insurance works by paying off the outstanding principal balance of your mortgage, up to a certain amount, if you die.

With mortgage insurance, the money goes directly to the bank or lender to pay off the mortgage – and that’s it. There’s no extra money to cover other expenses, and you don’t get to leave any cash behind to your beneficiaries.

What’s the difference between mortgage insurance and life insurance?

The main difference is that mortgage insurance covers only your outstanding mortgage balance. And, that money goes directly to the bank or mortgage lender, not your beneficiary. This means that there’s no cash, payout or benefit given to your beneficiary. 

With life insurance, however, you get mortgage protection and more. Here’s how it works: every life insurance policy provides a tax-free amount of money (the death benefit) to the beneficiary. The payment can cover more than just the mortgage. The beneficiary may then use the money for any purpose. For example, apart from paying off the mortgage, they can also use the funds from the death benefit to cover:

  • any of your remaining debts,
  • the cost of child care,
  • funeral costs,
  • the cost of child care, and
  • any other living expenses. 

But before you decide between life insurance and mortgage insurance, here are some other important differences to keep in mind:

Who gets the money?

With life insurance, the money goes to whomever you name as your beneficiary.

With mortgage insurance, the money goes entirely to the bank.

Can you move your policy?

With life insurance, your policy stays with you even if you transfer your mortgage to another company. There’s no need to re-apply or prove your health is good enough to be insured.

With mortgage insurance, however, your policy doesn’t automatically move with you if you change mortgage providers. If you move your mortgage to another bank, you’ll have to prove that your health is still good.

Which offers more flexibility, life insurance or mortgage insurance?

With life insurance, your beneficiaries have the flexibility to cover the mortgage balance and more after you die. As the policy owner, you can choose how much insurance coverage you want and how long you need it. And, the coverage doesn’t decline unless you want it to.

With mortgage insurance through a bank, you don’t have the flexibility to change your coverage. In this case, you’re only protecting the outstanding balance on your mortgage.

Do you need a medical exam to qualify? 

With a term life insurance policy from Sun Life, you may have to answer some medical questions or take a medical exam before you’re approved for coverage. Once you’re approved, Sun Life won’t ask for any additional medical information later on.

With mortgage insurance, a bank or mortgage lender may ask some medical questions when you apply. However, if you make a claim after you’re approved, your bank may ask for additional medical information.* At that point, they may discover some conditions that disqualify you from receiving payment on a claim.

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Real Estate

5 common mistakes Canadians make with their mortgages





This article was created by MoneyWise. Postmedia and MoneyWise may earn an affiliate commission through links on this page.

Since COVID-19 dragged interest rates to historic lows last year, Canadians have been diving into the real estate market with unprecedented verve.

During a time of extraordinary financial disruption, more than 551,000 properties sold last year — a new annual record, according to the Canadian Real Estate Association. Those sales provided a desperately needed dose of oxygen for the country’s gasping economy.

Given the slew of new mortgages taken out in 2020, there were bound to be slip-ups. So, MoneyWise asked four of the country’s sharpest mortgage minds to share what they feel are the mistakes Canadians most frequently make when securing a home loan.

Mistake 1: Not having your documents ready

One of your mortgage broker’s primary functions is to provide lenders with paperwork confirming your income, assets, source of down payment and overall reliability as a borrower. Without complete and accurate documentation, no reputable lender will be able to process your loan.

But “borrowers often don’t have these documents on hand,” says John Vo of Spicer Vo Mortgages in Halifax, Nova Scotia. “And even when they do provide these documents, they may not be the correct documentation required.”

Some of the most frequent mistakes Vo sees when borrowers send in their paperwork include:

  • Not including a name or other relevant details on key pieces of information.
  • Providing old bank or pay statements instead of those dated within the last 30 days.
  • Sending only a partial document package. If a lender asks for six pages to support your loan, don’t send two. If you’re asked for four months’ worth of bank statements, don’t provide only one.
  • Thinking low-quality or blurry files sent by email or text will be good enough. Lenders need to be able to read what you send them.

If you send your broker an incomplete documents package, the result is inevitable: Your mortgage application will be delayed as long as it takes for you to find the required materials, and your house shopping could be sidetracked for months.

Mistake 2: Blinded by the rate

Ask any mortgage broker and they’ll tell you that the question they’re asked most frequently is: “What’s your lowest rate?”

The interest rate you’ll pay on your mortgage is a massive consideration, so comparing the rates lenders are offering is a good habit once you’ve slipped on your house-hunter hat.

Rates have been on the rise lately given government actions to stimulate the Canadian economy. You may want to lock a low rate now, so you can hold onto it for up to 120 days.

But Chris Kolinski, broker at Saskatoon, Saskatchewan-based iSask Mortgages, says too many borrowers get obsessed with finding the lowest rate and ignore the other aspects of a mortgage that can greatly impact its overall cost.

“I always ask my clients ‘Do you want to get the best rate, or do you want to save the most money?’ because those two things are not always synonymous,” Kolinski says. “That opens a conversation about needs and wants.”

Many of the rock-bottom interest rates on offer from Canadian lenders can be hard to qualify for, come with limited features, or cost borrowers “a ton” of money if they break their terms, Kolinski points out.

Mistake 3: Not reading the fine print

Dalia Barsoum of Streetwise Mortgages in Woodbridge, Ontario, shares a universal message: “Read the fine print. Understand what you’re signing up for.”

Most borrowers don’t expect they’ll ever break their mortgages, but data collected by TD Bank shows that 7 in 10 homeowners move on from their properties earlier than they expect.

It’s critical to understand your loan’s prepayment privileges and the rules around an early departure. “If you exit the mortgage, how much are you going to pay? It’s really, really important,” Barsoum says.

She has seen too borrowers come to her hoping to refinance a mortgage they received from a private or specialty lender, only to find that what they were attempting was impossible.

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Real Estate

Canadian mortgage rules: What you should know





If you’re a new homebuyer seeking a mortgage, or an existing homeowner looking to switch or refinance, it’s important that you’re up-to-date on the new mortgage rules in Canada. Here are some of the top things you should keep in mind if you’re looking for a new home. 

The Canadian Mortgage Stress test in 2021

The stress test was introduced on January 1, 2018, as a way to protect Canadian homeowners by requiring banks to check that a borrower can still make their payment at a rate that’s higher than they will actually pay.  The purpose of the stress test is to evaluate if a borrower (a.k.a. the potential homeowner) can handle a possible increase in their mortgage rate.

For Canadians to qualify for a federally regulated bank loan, they need to pass the stress test. To do this, homebuyers need to prove that they can afford a mortgage at a qualifying rate. For homebuyers who have a down payment of 20% or more, currently the qualifying rate is determined using the Bank of Canada’s five-year benchmark or the interest rate offered by the lender plus 2%, whichever is higher. For homebuyers who have a down payment of less than 20%, the qualifying rate is the higher of the Bank of Canada five-year benchmark rate and the interest rate offered by the lender.

This stress test is also performed with homeowners looking to refinance, take out a secured line of credit, or change mortgage lenders. Those who renew with the same lender will not have to undergo the stress test.

Other new mortgage rules in Canada

As of July 2020, a number of changes were implemented for all high-ratio mortgages to be insured by the Canada Mortgage and Housing Corporation (CMHC).

A high-ratio mortgage is one where the borrower has a minimum down payment of less than 20% of the purchase price of the home. A high-ratio mortgage is also referred to as a default insured mortgage. Let’s break down what recent changes have been made.

Qualification rate

The new CMHC rules will lower the amount of debt that borrowers with a default insured mortgage can carry. Mortgage applicants will be limited to spending a maximum of 35% of their gross income on housing and can only borrow up to 42% of their gross income once other loans are included. This is down from the previous 39% and 44%.

Credit score

The new rules also require the borrower to have a minimum credit score of 680 (good score). If you are purchasing a home with your partner, one of you must have a score of 680. This is up from the previous minimum score of 600 (fair score).

Down payment

Homebuyers are now required to use their own money for a down payment instead of borrowed funds. This means homebuyers are no longer able to use unsecured personal loans, unsecured lines of credit or credit cards to fund their down payment.

Homebuyers with a down payment of less than 20% of the purchase price are required to purchase mortgage default insurance. Properties costing $1 million or more are not eligible for mortgage default insurance.

CMHC and CREA projections

Due to the pandemic, job loss, business closures, and a drop in immigration, CMHC predicted a 9% to 18% decrease in housing prices from June 2020 to June 2021.* However, this prediction hasn’t come to fruition.

Instead, 2020 ended up being a record year for Canadian resale housing activity, according to Costa Poulopoulos, the Chair of the Canadian Real Estate Association (CREA).**

The CREA predicts that all provinces except Ontario will see an increase in sales activity into 2021 as a result of low-interest rates and an improving economy. As for the CMHC, they stand by their original prediction.

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