Tag Archive for: 40 year amortization

Death of 40-year mortgage!

I could not have said it better my self so here is the article in it’s entirety.

Cheers,

Pat

 

Entrepreneurs’ flexible finance scheme quashed

Tony Wanless, Financial Post Published: Monday, July 21, 2008

For sale signs lined up along the street on Country Village Landing N.E. for condos in this Calgary, Alta. neighbourhood.Dean Bicknell/Canwest News ServiceFor sale signs lined up along the street on Country Village Landing N.E. for condos in this Calgary, Alta. neighbourhood.

When Canada Mortgage and Housing Corp. (CMHC) recently announced it was no longer backing 40-year amortization mortgages, it presumably was attempting to put some order into the teetering housing and mortgage markets. In the process it quashed the hopes and dreams of thousands of Canadian entrepreneurs who had rallied to the new mortgage as a flexible method of financing small businesses.

The 40-year mortgage was initiated by lenders last year as home prices climbed to levels that put monthly payments out of reach

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Sub-prime lender Wells Fargo beats expectations!

Reuters

July 16, 2008 at 8:27 AM EDT

NEW YORK — — Wells Fargo & Co. [WFC-N], the fifth-largest U.S. bank, reported better-than-expected quarterly results on Wednesday and raised its dividend despite a 23 per cent decline in profit caused by deteriorating credit.

You may be wondering why is this important? Well let me tell you. Wells Fargo is largely an Alt-A or Sub prime lender here in Canada. We need options and Wells Fargo provides that. I have been a broker for over 5 years and many sub prime and Alt-A lenders have come and gone. Wells Fargo has stayed the course. “A” lenders are a dime a dozen, and many offer similar products. 

Let me give you some examples, say you have less than perfect credit, we can most likely find something for you at Wells Fargo,

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Say goodbye to 40-year mortgages!

ELLEN ROSEMAN 
The 40-year mortgage, launched just over two years ago, will probably expire in October.

Back in April 2006, Genworth Financial Canada was the first to insure residential mortgages in Ontario that were paid back over 40 years.

Soon, all of Canada’s mortgage insurers will have to underwrite mortgages paid back over 35 years at most. Ottawa is not killing the long-payback loan because it sees a U.S.-style housing bust coming to Canada.

Canadian financial institutions have been conservative in their lending, says a finance department background paper.

And subprime mortgages make up less than 5 per cent of new loans issued in recent years.

A more urgent reason is to protect taxpayers – you and me – from possible losses if too many stretched borrowers default on their 40-year mortgages.

The federal government is on the hook financially

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