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TD, RBC End 2.99% Mortgage Deals Early

After a crazy month fielding calls about rates and competitive rates from the major banks, they have put a hault on them.  Although the product that were attached with them were limited and badly disclosed to consumers, there are still amazing rates to be had in the mortgage market.  The problem with banks is that they can choose to give one rate today and a different rate tomorrow.  All I can suggest be informed and do your homework and ask questions when shopping for a mortgage.  Its not always about rate its about having a mortgage plan that suits your needs and someone that can show you ways to save money on your mortgage long term!  If your interested in learning more about how to save money on your mortgage , no tricks no catch good ole information for you from me  http://bit.ly/AfD2RR    Here’s the article below;

After briefly offering record-low rates of less than 3% on some of its mortgages in response to its rivals, Canada’s two biggest banks have pulled back their offers prematurely.

Toronto-Dominion Bank, Canada’s second-largest bank, raised its special four-year closed fixed rate mortgage 40 basis points to 3.39%, effective Wednesday, while also introducing a special five-year closed fixed rate mortgage at 4.04%.

The bank also hiked its five-year closed mortgage 10 basis points to 5.24%.

TD had said it would offer the special rates until Feb. 29.

The moves put TD back in line with Royal Bank of Canada, which made the same rate decisions on Monday, coming into effect Wednesday.

RBC had also initially planned to keep its special rates available until Feb. 29

 

The only difference is RBC already had the special five-year closed fixed rate mortgage product, which it increased 10 basis points to 4.04%.

RBC had first cut its rate to 2.99% in January in response to a similar cut from BMO.

Matt Gierasimczuk, a spokesman with RBC, said the bank had to end its special prematurely because of rising funding costs.

“Our long-term funding costs have gone up considerably due to global economic concerns and, while we have held off in passing on these rate changes to our clients, it is now necessary for us to increase this mortgage rate,” he said in an interview with Bloomberg News on Monday.

With household debt-to-income ratios at at historic highs and still on the rise, the Bank of Canada has repeatedly voiced its concerns over the past year that Canadians are living beyond their means.

“We have expressed on numerous occasions our concerns about rising household indebtedness,” senior deputy governor Tiff Macklem said in a question-and-answer session following a speech in Toronto Tuesday. “The simple fact is that consumers are consuming more than they’re earning.”

With files from Reuters and Bloomberg News

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Condo for the studious kid?

Summer is drawing to a close and if the student in your household is studying in Toronto, they may be moving back into residences or private rental accommodation.

However, some parents are choosing to buy a place for their offspring, and perhaps some friends, to live in for the duration of their studies. While it may sound like a great investment, your financial planner will be getting you to ask some tough questions.

Ask yourself: “Can we afford it?” says Carol Bezaire, vice-president, tax and estate planning at MacKenzie Financial in Toronto, who reccomends planning ahead by asking: “‘What are we going to do with this property if our child doesn’t go to school or drops out?’ Down the road if the child decides they want to stay in the place, ‘What kind of arrangement with the child are we going to have?’ ”

Ms. Bezaire recommends getting legal and tax advice when drawing up an agreement between you and your child. If you charge your child rent, they can write it off as a tax credit. However, you will need to record the rent as income on your return and you will be liable for tax on any capital gain when you sell the property. If space will be rented to non-family members, Ms. Bezaire says, you must get tax advice on operating a business rather than a personal arrangement.

The type of housing stock available may also affect the rent-versusbuy decision.

“As a market investment, condos have definitely grown exponentially. In Q2, we had 9,445 condos sold,” says Pauline Lierman, senior research analyst, Urbanation in Toronto. A lot of that is due to the fact that students have a desire to be in the city, but there is a shift away from the houses that are broken down into units. “Families are moving back in and buying them and converting them back into singlefamily units, so you’re getting areas where there isn’t as much supply of the traditional type of student-ghetto housing.”

Some parents – particularly from overseas – have been planning ahead.

“Some projects have been very successful in their marketing to forward-thinking families,” says George Carras, president, RealNet Canada. “They may consider that, ‘My child is much younger, we like Canada and we’d like them to come to school in Canada. So let’s just invest in the condo as possible accommodation.'”

Mr. Carras says such purchases tend to be focused around University of Toronto’s and George Brown’s main downtown campuses.

“You can start to see some of the development acquisitions and interests taking place further north,” Mr. Carras says. “For Seneca, [there’s interest in] some of the growth that’s taken place in and around the Sheppard corridor. You’re within a reasonable distance to the school but you’re also accessible to public transit.”

While your child studies, many new and resale condos will come up for sale in the GTA. Mr. Carras and Ms. Lierman both say continued population growth, coupled with a decline in single-family home construction, means there will likely be decent demand should you decide to sell the condo when your child graduates.