BC Public Inquiry into Money laundering
#16
Re: BC Public Inquiry into Money laundering
Eligibility for a mortgage is never reassessed, you are eligible at the start and that's it. ….. Or you saying that negative equity will mean you cannot move? That is true for a small percentage of people, but only those who bought near the top of the market, perhaps overstretching themselves, but that wouldn't likely apply to anyone who has owned their home for long before the market peaked, say 8-10 years, especially because during those 1- years they will also have been paying down the principal on their mortgage.
#17
Re: BC Public Inquiry into Money laundering
I believe it's reassessed at renewal. I'm saying that negative equity would lead to people walking away, as they do in Alberta when the boom-bust cycle is in a bust phase. I'm suggesting that the impact of removing the proceeds of crime from the market would affect many people, through the house price collapse, and, for that reason, it's neither desirable nor likely to happen. House prices have to fall by something like two thirds before reflecting the purchasing power of workers in Vancouver, it's not a minor correction.
#18
Re: BC Public Inquiry into Money laundering
What do you mean by "renewal"? The ability of borrowers to afford mortgages in the UK and US is assessed at the start, and unless you stop paying there is never any sort of "reassessment", you just keep paying until the whole balance is paid off. It is different in Canada? Can you be foreclosed on even if you keep making payments but wouldn't qualify if it was a new mortgage?
And I'm disagreeing. There would be some losers and a some short term pain, but many more winners, especially if it returned property prices to more affordable levels. And therefore I think it is likely.
... I'm suggesting that the impact of removing the proceeds of crime from the market would affect many people, through the house price collapse, and, for that reason, it's neither desirable nor likely to happen. …...
#19
Re: BC Public Inquiry into Money laundering
What do you mean by "renewal"? The ability of borrowers to afford mortgages in the UK and US is assessed at the start, and unless you stop paying there is never any sort of "reassessment", you just keep paying until the whole balance is paid off. It is different in Canada? Can you be foreclosed on even if you keep making payments but wouldn't qualify if it was a new mortgage? .
Well, we shall have to wait and see.
#20
Re: BC Public Inquiry into Money laundering
#21
Re: BC Public Inquiry into Money laundering
My view is that the Vancouver economy is based on money laundering, eliminate it and house prices will fall across the board, those who have borrowed heavily to buy houses, or flats, will be in deep trouble. One might argue that a new wave of house purchasers will benefit but it's the existing householders who vote.
The money launderers are an even more elusive target, primarily because it is not against the law in B.C., at least not yet, to pay cash for something.
The recent government-ordered report on money laundering in B.C. real estate was vague to the point of nonsense. It could be worth $800 million. It could be $5 billion. Whatever, who knows? The report also stated that Manitoba and Saskatchewan have more money laundering in real estate than B.C., which gives an idea of how much faith we should put in its findings.
Now the provincial government has ordered an expensive Commission of Inquiry into Money Laundering in B.C., which won’t report back until May 2021.
The recent government-ordered report on money laundering in B.C. real estate was vague to the point of nonsense. It could be worth $800 million. It could be $5 billion. Whatever, who knows? The report also stated that Manitoba and Saskatchewan have more money laundering in real estate than B.C., which gives an idea of how much faith we should put in its findings.
Now the provincial government has ordered an expensive Commission of Inquiry into Money Laundering in B.C., which won’t report back until May 2021.
Last edited by CanadaJimmy; May 31st 2019 at 8:05 pm.
#22
Re: BC Public Inquiry into Money laundering
I believe it's reassessed at renewal. I'm saying that negative equity would lead to people walking away, as they do in Alberta when the boom-bust cycle is in a bust phase. I'm suggesting that the impact of removing the proceeds of crime from the market would affect many people, through the house price collapse, and, for that reason, it's neither desirable nor likely to happen. House prices have to fall by something like two thirds before reflecting the purchasing power of workers in Vancouver, it's not a minor correction.
#23
Re: BC Public Inquiry into Money laundering
I have never heard of this happening in Alberta, so maybe it is an Ontario thing.
#24
Re: BC Public Inquiry into Money laundering
Not the case according to this article: https://biv.com/article/2019/05/money-launderers-latest-bogeyman-blame
#25
Re: BC Public Inquiry into Money laundering
Maybe, It's common, perhaps even usual, here to move the mortgage between carriers at each renewal. Obviously that requires documentation.
#26
Re: BC Public Inquiry into Money laundering
OK. I accept that as that would be required here too, although I wouldn't call that a renewal. I would call that a new mortgage.
#27
Re: BC Public Inquiry into Money laundering
According to Wikipedia: "The most common mortgage in Canada is the five-year fixed-rate closed mortgage, as opposed to the U.S. where the most common type is the 30-year fixed-rate open mortgage. ...."
I haven't (yet) found out exactly how Canadian mortgages work, especially after the first five years, but I guess that for most people it is just allowed to rollover into a new five year term at a new fixed rate at the same bank.
I haven't (yet) found out exactly how Canadian mortgages work, especially after the first five years, but I guess that for most people it is just allowed to rollover into a new five year term at a new fixed rate at the same bank.
#28
Re: BC Public Inquiry into Money laundering
If the mortgagee does nothing, that's what happens. I assume that people who are in regular paid employment need do nothing at all. I had to trudge into the bank and demonstrate that I was the same risk as before. Other options are to switch to a variable rate, over a term that can be chosen, or to move to another institution at a different fixed rate; banks compete and will offer an incentive to switch though it's usually no more valuable than a MAGA hat Variable rate mortgages typically come with the option to switch to a fixed rate mid-term and, I suppose, are a good bet for people who pay attention. There's also the VTB mortgage whereby the person selling a house agrees to take payments in installments at a rate better than an investment pays and less than the bank charges; at one point I paid a VTB mortgage at 18%.
#29
Re: BC Public Inquiry into Money laundering
According to Wikipedia: "The most common mortgage in Canada is the five-year fixed-rate closed mortgage, as opposed to the U.S. where the most common type is the 30-year fixed-rate open mortgage. ...."
I haven't (yet) found out exactly how Canadian mortgages work, especially after the first five years, but I guess that for most people it is just allowed to rollover into a new five year term at a new fixed rate at the same bank.
I haven't (yet) found out exactly how Canadian mortgages work, especially after the first five years, but I guess that for most people it is just allowed to rollover into a new five year term at a new fixed rate at the same bank.