Mortgage Radar: Td Bank Collateral Charge, Investment Properties, Mortgage Qualification for Self Employed, Targeting New to Canada, Tax Deductible Fortitude

October 25, 2010

The Mortgage Radar includes news and blog articles that have come across my desk in the past 7 days that I think are of interest or provide entertainment value.
The TD bank announced a major change to the way they register their mortgages, changing them from a “standard charge” to a “collateral loan”. The end result is that borrowers will be handcuffed to TD. Ultimately this is a strategy to prevent borrowers from leaving TD at maturity. They are selling it to borrowers by allowing them to register up to 125% of the current market value of their home.  Ironically the very next day TD released a report that Excessive Personal Debt is a Concern. Yeah ok.
For many people buying a rental/investment property is of high priority but one should always be wary of the challenges and costs that come with owning a rental property. Read about the Landlord Blues and if you are into the numbers check out the latest on buy/rent ratios from The Globe & Mail and lastly a great article about Why You Might  Rent Your home from The Star.
3 or 4 years ago lenders and insurers developed mortgage products to accommodate self employed individuals making it easier for business owners and commissioned sales people to secure financing.  Today many of those programs have disappeared and Securing a Mortgage is More Complex For Self Employed.
The Conference Board of Canada estimates that immigration will peak at 350,000 immigrants a year by 2030, accounting for more than 80% of population growth. Financial institutions are no slouches and recognize that this represents a large chunk of business learn how they are now targeting newcomers for growth.
For a time my father and I were heavily involved with promoting the Smith Manoeuvre or Tax Deductible Mortgage as a strategy to make your mortgage payments tax deductible and ultimately pay down your mortgage years quicker saving the borrower money in interest. While the strategy does work my father and I observed that most borrowers Lack The Fortitude it takes to make mortgage interest tax deductible.


Christopher Molder

Mortgage Broker

Christopher is a mortgage broker based in Toronto, Canada. And a son of a broker too. He’s a second generation mortgage broker. Following in his father’s steps he joined the family mortgage business straight out of university.