Elizabeth Blair

I attended a seminar on October 15/08, in Toronto with guest speaker Benjamin Tal who is the Senior Economist with CIBC World Markets. It was an excellent seminar which highlighted many projections for our economy. Here is a summary of some of the items that Benjamin discussed:

- the US housing market has experienced a drop of approx 18% since January of 2006. There is an estimated drop of 0.5% per month until early 2009 when house prices will stop falling and the housing market will "bottom out".

- when housing prices stop falling we will begin to see recovery in the market.

- end of the cycle is near - every 1% drop is equal to $500 billion in market losses.

- 50% of the losses are being felt in Europe

- UK banks got heavily involved in subprime market investments

- consumers must recognize that variable mortgage discounts will not be as low in the short term, as we have seen, in the past. Example, Prime minus 1% is likely to not ever come back in this market.

- Auto Sales are down.

- Canada has seen 120,000 new jobs created in Canada.

- Canada did well, in the recent past, as commodity prices were rising and we received more money for goods, especially in the West. There is going to be a certain upcoming correction in the commodity market in the near future.

- Mortgage interest rates are projected to RISE into 2010.

- Inflation is headed our way as food prices and energy prices will continue to rise

HOUSING MARKET

- MLS activity will be down by 20% by the end of the year

- people are borrowing at a much faster rate with DEBTs rising faster than wealth or accumulation of assets; people's net worth is declining.

- Early 2009 will promise a BUYER's MARKET as there will be continual downward pressure on home prices and a levelling off

- a straight comparison between US and Canadian housing market showed Canada was only about 5% at the PEAK in the subprime market whereas the USA was probably at about 30%

- Clearly Canada does not show the usual TRIGGERs that would normally be present to indicate that we are headed for a freefall in the market; we would need to see double-digit interest rates, and 7-8 years of instability in the markets

- We must see the return of banks willing to lend to each other and this will hopefully happen as money has been injected into the system to free up the credit market

- the next 6 months are pointing to an extremely rough ride - there is going to be a RECESSION - economy will be very WEAK, although after the 6 month period, we will be seeing some RECOVERY in the market

- Housing activity will clearly weaken in the Canadian market but recovery is expected by the end of 2009, in the housing market

- housing values are expected to drop 5 to 10% in Canada, and an approximate 5 - 6% in Ontario region.

- Mortgage interest rates are going to SPIKE in 2010 and on average they will be HIGHER than they are now as banks will continue to pass on their losses to consumers

This blog was written by Elizabeth Blair, a Licensed Mortgage Agent with Mortgage Edge in Richmond Hill, Ontario.

Elizabeth services clients in Mississauga and all over the Greater Toronto area.

You can contact Elizabeth directly by phone at 905-510-5785 by email at eblair@mortgageedge.ca or visit Elizabeth Blair's website at www.missmortgage.ca

Elizabeth is a member of IMBA (the Independent Mortgage Broker's Association of Ontario) and is also Licensed with the Financial Services Commission of Ontario (FSCO).

I went out for a walk, the other day, with my family. My son, who is 4 years old, really enjoyed walking through the leaves because of the loud crunching sounds. So as we walked along, I made up a song about the crunching leaves and as we held hands and sang the song, I felt a peaceful enjoyment that sometimes only our kids can bring out in us, even in the most stressful times. My job, as a mortgage professional, seems to have been stressful lately, as I hear about the news, the bad news, the mortgage crisis........ It is funny how the word crunch came to my mind, and made me think of the very ominous "credit crunch" we are experiencing today.

In August of 2003, Ontario experienced a power blackout and it was the largest blackout that we, as Ontarians, ever experienced in our history. I was driving home and wondered why the traffic was suddenly at a complete stand-still at every intersection. When I turned on the news, I heard that there was a power outage. I called my husband's office, and was not even able to get through as their own telephone system was down. Panic set in. How was I going to reach my husband? I had the car, and he was stuck at his offices with no telephone. I drove home and waited and listened as the news continued to unfold. The next couple of days meant we had to pull together our resources to get through, with no electricity. We realized quickly, how vulnerable we were, facing this new challenge. We were short on candles, we had only one working flashlight and our canned food supply was slim. Without a working fridge, we knew that we could only rely on that refridgerated food for a day or so. It seemed like the onset of doom and gloom but the power outage developed something neat that I had not ever experienced before, on my own street. People came out of their houses, walked around to different neighbours, actually talked to one another. Most days, people rush in and out, carrying out their daily responsiblities, work, driving in and out on errands, pressed for time, stressed out day in and day out. I felt this huge inconvenience, no power, actually brought on a truly amazing and positive change and as strange as it sounds, I really felt it brought us together.

I wondered, as I crunched through the leaves, with my little guy, that day, whether this current credit crunch will change me. Is it going to be an "every man to himself" market, or will we all be forced to run our businesses a little differently, helping out the smaller business owner, thinking about who we should send the next referral to. I have already started to think this way and interestingly enough my phone started to ring, from people who just wanted to get together for coffee, instead of our usual running around in a panic work-style......interesting. Maybe the tougher times will give us a chance to look deep into our souls and ask ourselves what we really need to change.

This blog was submitted by Elizabeth Blair, a Licensed Mortgage Agent with Mortgage Edge located in Richmond Hill, Ontario, Canada. Elizabeth services clients in Toronto and all over the Greater Toronto Area, including Mississauga.

You can contact Elizabeth directly by phone at (905) 510-5785, by email at Elizabeth@missmortgage.ca or visit her website at: www.missmortgage.ca

Elizabeth is licensed with the Financial Services Commission of Ontario and is also a Member of IMBA (the Independent Mortgage Brokers Association of Ontario) www.imba.ca

Here is a question, I am often asked.....how can I get a copy of my credit report ?

If you are applying for a mortgage, a loan, a credit line, or are seeking to rent a property, your credit report will be accessed and reviewed by the person or the institution where you are applying. If you have purchased a home, you may also be asked to provide some proof of your credit status by any of the local utility companies who you need to utilize the services of.

For a mortgage application, the bank loan officer, or the Mortgage Broker/Agent will require a copy of your credit report. When the mortgage application is completed, the credit report will be requested on your behalf, as part of the application process. Remember that you must always be ASKED to sign a credit permission or consent form BEFORE anyone is authorized to retrieve a copy of your credit report. Do not allow anyone to pull your credit report over the phone. If they have pulled a credit report, without your PRIOR written consent, you have grounds for a formal complaint. The basic information required, to access a credit report is: full legal name, current address, city, province, postal code, date of birth and social insurance number. Most banks and brokerage houses are pulling credit reports directly from Equifax Canada. The cost to access your consumer credit report is covered, by the bank or brokerage that is completing your mortgage application. It is also important to mention that your bank or Broker/Agent is never permitted to give you a copy of your credit report, nor are they permitted to share particulars about your credit report with you, for example, what your actual credit score is. If you need a copy of your own credit report, you must access it on your own.

You can access your credit report by going online to the Equifax website: http://www.equifax.com and request a copy of your credit report there. You will need your credit card to order either one of the two available report formats. The first, more detailed report, is available for $23.95 Cdn and this detailed report will provide you with your actual "credit score". The credit score is the number that most lenders use when deciding whether they will give you financing or not. The second report is available at a lower price of $15.50, however, your actual credit score is not available on that less expensive credit report.

If you would rather not pay for your credit report, you can access a copy of your credit report, once per year, free of charge. By filling out the Equifax form available at this link and returning it to Equifax, you will then receive a copy of your credit report in the mail.

http://www.equifax.com/EFX_Canada/consumer_information_centre/docs/request_report_form_e.pdf

Note that when you request your credit report, by this method, you will NOT be able to see your actual credit score. If it is your credit score, that you would like to see, you will need to go on-line and purchase the Equifax report via the website at the $23.95 Cdn price.

Knowing your credit score is important as it helps to ensure you are always eligible for the best rates and financing options. Find out your own credit score, monitor it, protect it and take the necessary steps to maintain the best credit score you possibly can.

This blog was submitted by Elizabeth Blair, a Licensed Mortgage Agent with Mortgage Edge located in Richmond Hill, Ontario, Canada. Elizabeth services clients in Toronto and all over the Greater Toronto Area, including Mississauga.

You can contact Elizabeth directly by phone at (905) 510-5785, by email at Elizabeth@missmortgage.ca or visit her website at: www.missmortgage.ca

Elizabeth is licensed with the Financial Services Commission of Ontario and is also a Member of IMBA (the Independent Mortgage Brokers Association of Ontario) www.imba.ca

Today is September 22, 2008, and there are now only 23 days remaining, before the landscape, in Canadian mortgage lending undergoes some big changes. Many, who are seeking to buy their first home, in Canada, will be surprised to learn that lending guidelines will be very different in 23 days and for good reasons.

On October 15, 2008, changes, mandated by our federal government, will be introduced by the mortgage insurers. These changes are being implemented to help ensure the Canadian housing market remains robust.

Here is a list of what is expected to come:

1. The zero-down mortgage program will be removed. You can no longer buy a house unless you have at least 5% down and enough of your own savings to cover your closing costs.

2. Mortgages can only be amortized up to a maximum of 35 years. The 40-year amortization option will be removed.

3. If you are buying a house, in Canada, with a 5% downpayment, you will need to have a minimum credit score of 620 to qualify for an insured mortgage.

There has already been some turbulence and change which has gone unnoticed by many....for example, some lenders have already dropped out of the mortgage lending business altogether, and more changes will likely unfold in the months ahead.

I prefer to stay away from doom and gloom thinking however this countdown is feeling more like a taste of reality to me. Tougher lending guidelines will limit the options for many consumers who might have otherwise been ready to buy now. With less options to pick from, I am going to sit up and pay attention to my own business today, and assess how it will survive in a tougher market. With the imminent strain on some consumers to qualify, and the tightened lending guidelines only days away, now seems like a good time for realtors and mortgage professionals, to realize that an exodus wave is headed our way. Who will stand?

This article was written by Elizabeth Blair, a Licensed Mortgage Agent with Mortgage Edge in Richmond Hill, Ontario. Elizabeth services clients in Mississauga and all over the Greater Toronto area.

You can contact Elizabeth directly by phone at (905) 510-5785, by email at eblair@mortgageedge.ca or you can visit her website at: www.missmortgage.ca

Elizabeth is licensed with the Financial Services Commission of Ontario and is also a Member of IMBA (the Independent Mortgage Brokers Association of Ontario) www.imba.ca

I was sitting at my desk, the other day, and my mobile phone rang. I answered it, and heard the voice of a realtor, that I met, just around 3 years ago. He has been in the real estate business for a very long time, in fact, I would say he has seen a few market ups and downs, in his professional career.

He did admit that he was calling someone else, and accidentally called my number. I was thrilled that he had at least, taken the time to program my name and number into his phone but wondered if he really carried around the same mobile from three years ago?

Although our conversation was brief, we asked each other how business was going and he indicated that business was slower this year, compared to last year and I also admitted that sales were also down for me. He stated that this slow down would inevitably result in an exodus of realtors out of the industry and I agreed that the same thing would probably happen in the mortgage financing industry and we both agreed that many don't make it.

We ended our conversation, but I thought about our discussion for a better part of the day. I searched the internet and could only find an article about realtors but could not find statistics relevant to Ontario. I found this article.....While it is not exactly the "most recent" article that I could find, it was a real eye-opener for me:

http://www.businessweek.com/the_thread/hotproperty/archives/2006/12/too_many_realto.html

While many who joined the industry (mortgage financing and real estate), in the recent booming market, and with high hopes of earning considerable incomes, many will also leave because there will just not be enough business for everyone.

Elizabeth Blair, Mortgage Edge

www.missmortgage.ca