The fact that Canada’s Jobless rate is up should be BAD NEWS right? Not this time.  Here’s why:

According to Stats Canada

Employment rose for the second consecutive month in January, with a gain of 69,000. At the same time, the unemployment rate increased by 0.2 percentage points to 7.8%, as more people searched for work. Compared with January 2010, employment was up 1.9%

The fact that more jobs have been created is fabulous news for our economy.  And the fact that more people are looking for work is also good news!

In an interview for the CTV News Channel, Derek Burleton, vice president and deputy chief economist at TD Bank Financial Group put a very positive spin on the jobless rate.

“One thing we, as economists, have been looking at is a lot of discouraged workers leaving the job market just because they couldn’t find work in areas like manufacturing. The fact that we did see more than 100,000 new Canadians in the labour force in the month speaks volume about the fact that the labour market is healing.”

How’s that for a positive spin on what we would ordinarily consider to be some very negative numbers!

However there IS a downside to all this positive news. The experts were also predicting that the Bank of Canada would increase their rates this summer because the BOC has to keep a check on too much growth.  Make sense to you?

What it means … if you are thinking about buying a house, or refinancing. Do it sooner than this summer!  Give us a call if you have any questions. We are NOT economists, but we can set you so that you are not burned if the rates increase.

Call us:  604-736-1855

Act NOW or lose!

5-year bond yields have jumped dramatically over the past week and fixed rates should certainly follow. Several banks and non-branch lenders have already increased their rates as a result. Check out this graph showing changes over the past 5 months.

Regardless of your position on the fixed vs. variable debate, it can’t be overstressed how LOW fixed rates are right now. At 3.39% for a 30-day close, 5-year fixed mortgages are a whopping 166 basis points below the 10-year average of deep-discount rates (which we’ve based on a 160 basis-point discount off posted rates for discussion purposes). Locking in at 3.39% is like winning a small lottery, historically speaking.

So if you need a fixed rate for a new mortgage closing in the next 120 days, be prepared to act NOW especially if yields continue higher.

Call Now: 604-736-1855

Check out our current rates HERE

* Thanks to Canadian Mortgage Trends for the Data used in this post

We’ve been interviewed twice in the past week by different reporters at the Globe and Mail.

The first article appeared on October 11, 2010

TD overhauls mortgage program as housing market slows was written by real estate reporter Steve Ladurantaye.

The move has sparked anger among the country’s independent mortgage brokers, who see the change as a direct shot at an industry that has been gaining market share from the big banks by competing fiercely on mortgage rates.

“Credit unions have always gone this route so it’s not like they are reinventing the wheel,” said Mike Averbach of Vancouver’s Averbach Mortgages. “People literally have to cash out if they want to change over, so it’s just another way for them to be handcuffed to the bank.”

You can read the entire article here.

The second article is a Special to Globe and Mail Update written by columnist  Angela Self.  Six questions to ask before you buy a home is one part of a series of articles for the Globe’s Investor Learning Centre.

I provided the question . . .

Do you have a steady job and income?

It’s harder and harder to be approved for a mortgage if your provable earnings are not steady. A steady income and a reliable job make a very big difference these days, according to Mike Averbach, president of Averbach Mortgages in Vancouver. He adds that going through a full analysis of credit and income is an important first step for house-hunters because it provides an accurate feel for the amount of house you can afford and will address any possible issues before you begin your search.

Read the full article here.

If you are thinking about whether or not you should consolidate your debt by refinancing,  here are a few pros and cons that could help you make your decision.

The main benefit of using equity in your home to pay off  credit card or other personal loan debts is that the interest rate will likely be much lower. Compare current rates to credit card financing of 20% and more.

Another benefit is that by combining your debts into a loan with a longer repayment term (like a mortgage) you will probably reduce your total monthly expenses. This is one of the major reasons why people use their homes to pay off debt.

On the CON side of  the equation is that by borrowing against your home, you are changing debt that is unsecured into debt that is secured by your home. If you are already struggling to pay your mortgage, you may be setting yourself up for trouble. The last thing you want to do is lose your home by defaulting on your mortgage payments.

You MUST Plan Your Budget

The best way to determine if you can afford to safely refinance your home and consolidate debt is to sit down and determine a budget.

Take all of your bills, utilities, and payments that you make every month and subtract them from your income. Don’t include the debt payments you plan on rolling into your mortgage.

IF you can comfortably pay your bills, and pay a slightly higher mortgage payment then refinancing might be the right thing to do.

If your numbers are negative then maybe you should consider moving to a more affordable home.

Though this seems drastic it is better to sell and get something more affordable. Your home is probably your most valuable asset, so be sure to take the steps necessary to protect your investment.

If you DO decide that consolidating your debts into your mortgage is a good decision, please give us a call and we will help you get the refinancing you need.   604-736-1855

PS.  We have several online calculators that will help you crunch your numbers to see whether debt consolidation is an option for you.

Since we have recently added a new baby Averbach to our family, babies are on my mind!

Yesterday, I read an article from the Globe and Mail,  Getting financially prepared for a maternity leave, which focused on how important it is to plan ahead.

The gist of the article is that even if you are eligible for maternity leave benefits your finances will take a hit. Are you planning for that hit?

One of the women interviewed said,

It will probably take two years to get back to our previous levels of savings,” she says. “I don’t stress about it much because overall our finances are okay and this is just something short term. I loved having the time to spend with my babies when they are little and I’m okay with the financial sacrifice.

Babies are expensive … Are you going to be able to make your mortgage payments, without over stressing your budget? Should you refinance? Are you planning on buying a new home or on renewing?   How will being on maternity leave affect getting new mortgage financing?

The sooner you plan for the new addition to your family the better!  Give us a call if you have any questions about how being on maternity leave may affect your mortgage financing.

On the CBC news site there is an article about how someone’s credit score was downgraded by 100 points because of an unpaid bill.  The gentleman in the article,  had moved and failed to inform one of his creditors (Telus).  Since the bills were going to the wrong address, it remained unpaid for years until it dramatically affected his Beacon score.

“When you have a lower beacon score it affects the amount a creditor will lend to you,” said Bonnie. “When there’s damage on a credit report it’s on there for six years.”

I highly recommend reading the article because it outlines Telus’s rationale for not tracking him down.  The article also gives some great tips about what you should do in similar circumstances and what you can do “after the fact” if your Credit Score is damaged.

This article really hit some “nerves” … check out the comments!