Oh Canada $$$

I'm on max payment right now. See what you do to me OZ

 

My CU allowed for a 15% increase to my payment annually which I did for 3 or 4 years till it was basically at the max I felt I could afford

 

I'm allowed 10% plus a 10% lump payment at the end of the year. Right now with the wife on EI for maternity leave all I can afford is the 10% TBH.

 

I'm not sure bout all variable rate mortgages but mines has the option to switch to fixed at anytime with no fee or penalty. That gives me peace of mind.

 

Makes sense then to milk the low rates while you can and then lock in at the first up tick in fixed rates

My advice to anyone starting out at the beginning of a new ammortization period is to pay a bit extra per month

Our first mortgage was in 1995 , 3 year for 8.75% , paying $65 / month over the minimum payment knocked off about 5 years

 

Yes, but you lose the 0.1% to 0.2% advantage that most banks offer under their posted rate. For example if you wanted to switch to a fixed rate right now, and you are with a major bank, you'd have to take the rate at 2.74% (this was BMO's posted rate when I signed) not 2.54% which most people are signing for. If the BOC rate goes up by a half point, which is a rare but possible move the economy heats up, then that could hurt too.

There is no such thing as a perfectly safe variable rate, though like you said, there are some great options out there that are better than a classic variable rate.

 

Exactly. Otherwise I think I would have jumped on the low fixed but why not milk this for now.

 

See my above post. If you have to lock in your rate within the first 2 years it's a wash because of the discount everyone else gets but you won't. When you lock in you lock into posted rate. That's the problem. I looked into it with BMO as well and once I went through it, with my 0.2% discount on there posted rate, it didn't make sense for me to go to a variable rate (which at that time was about 2.3% IIRC).

 

I'll have to inquire about that because honestly I have no clue. What pisses me off in this whole process is CMHC. How many people have 100k to put down on a house? Even if I had 100k just sitting in an account I doubt I would dump in all on the down payment to avoid CMHC. Such a money grab.

 

I didn't have to pay CHMC fees. Did you have the house reappraised? What happened to me is that between my 10% down payment, buying low, and a desperate seller I ended up with a house that was priced over 70K under market value. Good bye CHMC fees.

It's not possible to do that often but, if they housing prices in your area go up and you are on a variable rate mortgage, it might be worth having the bank send an appraiser and see if you have enough equity to get out of CHMC fees. If your house is brand new obviously this won't apply for a few years, but if you bought used it could work out faster than you think.

 

It's a brand new build. 20% down to avoid cmhc. Not happening.

 

Yeah, brand new you are up shit creek without a paddle, but at least you aren't pouring money into your house in reno's like I am.

They basically have those fee's there to protect the banks. If there were no CHMC fee's real estate speculation by people who can't afford it would be even worse than it already is.

New here is crazy high priced because of the labor shortage a few years ago. I bought a house for less than $250K that would of cost a minimum of $325K to build. Even if I dump in 75K renovating, I'll still be ahead though.

 

I looked at older houses but it didn't make sense here. 400k for a 1954 bungalow that needs 80k of reno's to get it where I would want it. I understand the purposes of cmhc but when you're purchasing a house half the amount of what you're approved for and have an 860 credit score there should be exceptions. Everyone pays for the defaults of others. It what it is. Looking forward to moving in this month...alone..finally a place I can't get kicked out of haha