Is your mortgage coming up for renewal this year?

There is a good chance that you or someone know has a mortgage coming due. Some 47% of Canadians, almost one out of every two households, that currently have financing in place will mature within the next 12 months with a major lender in Canada.

Here are a couple simple rules to follow if you, a friend, a family member or colleague are renewing your mortgage this year.

• DO NOT just simply sign the renewal letter that comes in the mail.
• INVESTIGATE your options.

70% of all mortgagors simply sign the renewal letter that comes in the mail. You would think that because you have been with the current lender for so long that you would receive the BEST rate out there. NEWS FLASH, that is 100% false. Remember, lenders are in business of making money for their shareholders. Your current lender has done their homework, you should do yours. They know that most of the borrowers will sign and send back the form for ease and convenience. We are lazy by nature and we possess too much trust. As finance consumers, there are scenarios I’ve seen where we are leaving 20-40 (0.20% – 0.40%) basis points on the table.

I recently read an article online that indicated the average mortgage amount in the Metro Vancouver area was $438,716 for 2016. Let’s round that amount to $450,000 for ease of calculation. For every 0.25% difference the mortgage payment increases (or decreases) $13 per every $100,000 extended. If your current lender offered you a rate 0.25% higher than another lender then this scenario would yield an annual increase of $936. Are you able to invest 4-5 hours of your time to save that kind of money? Heck ya you can! That is $187.20 – $234 per hour.

Renewing with your existing lender may or may not be your only option. When 47% of you out there receive the renewal letter in the mail this year, I have 936 reasons why I would strongly advise you to reach out to a Dominion Lending Centres mortgage specialist to discuss ALL your options – switching lenders to save money and/or leveraging equity for financial planning purposes.
Here is an example of how I just re-financed my home to access my equity. We were able to obtain a HELOC (Home Equity Line of Credit) mortgage product from a major Canadian charter bank.

• Current residence appraised at $1.15MM.
• Current mortgage balance, $445,000.
• Maximum loan limit, $920,000 (80% of market value: 1,150,000 x 80%).
• Opted to secure the current balance into a variable rate mortgage
• The equity of $475,000 was set-up access from a line of credit
• These clients now have access to funds for any future needs: renos, emergency, investment opportunities, post-secondary education for their children.

But while a HELOC allows for product diversification and long-term planning, it is not for everyone. It can be a bad idea if it’s just used as access to easy cash. One needs to possess high self-discipline, as the funds are extremely accessible. A HELOC is also not available to all homeowners as there must be greater than 20% equity in the home before a lender will consider it.

With 13 modifications to the lending policies since 2006 the time to plan is now. If I were to attempt the same re-financing maneuver today to leverage equity I would qualify for 20% less ($95,000) or $380,000. This would be one less rental property added to the portfolio. Before anymore changes happen, you should consider accessing your money today.

MICHAEL HALLETT

Dominion Lending Centres – Accredited Mortgage Professional
Michael is part of DLC Producers West Financial based in Coquitlam, BC.

Mortgage Insurance Premiums. Many people know what they are- an extra cost to you the borrower. But not many people realize how they are calculated. Understanding the premium charges and how they are calculated will help lead you to making smarter down payments.

• 5%- 9.99% down payment of a purchase price is a 4% premium
• 10%- 14.99% down payment of a purchase price is a 3.10% premium
• 15%- 19.99% down payment of a purchase price is a 2.8% premium

So, that means with a $300,000 purchase price and a $30,000 down payment (10%), you would have a 3.10% premium added to your mortgage, making your total mortgage amount $270,000 + $8,370 for $278,370 total. The $8,370 being 3.10% of your original $270,000 mortgage.

Now let’s say you have a down payment potential of $60,000 and have the income to afford a $350,000 purchase price but you found one for $325,000. Using your entire $60,000 down payment (18.46%), your new mortgage amount would be $272,420, where $7,420 of it represents the mortgage insurance premium.

But what if you change that $60,000 (18.46% down payment) to say $48,750 and have a down payment of exactly 15%? Well, your premium is still the exact same as it would be with an 18.46% down payment because your premium is still 2.8% of the mortgage amount. That means you will now save $11,250 (difference in down payments), while only paying $7,735 in premiums (an increase of $315).

I don’t know about you, but if someone told me I could put $11,250 less down and it would only change my insurance premium by $315, I am holding onto that money. You now have more cash for unexpected expenses, moving allowance, furniture, anything you want. You can even apply it to your first pre-payment against your mortgage and pay the interest down while taking time off your loan. Obviously if cash is not an issue, putting the full $60,000 would be better seeing as you are borrowing less and paying less interest. However, if cash is tight, why not hold onto it and pay that difference over the course of 25 years?

Consult with a Dominion Lending Centres mortgage professional when it comes to structuring your mortgage request with a bank. It is small little things like this that make all the difference.

RYAN OAKE

Dominion Lending Centres – Accredited Mortgage Professional
Ryan is part of DLC Producers West Financial based in Langley, BC.

If you’re an entrepreneur, business person or commercial investor then you probably have or need a commercial mortgage.

Where should you start?

Do you call your bank, or do you call a commercial mortgage broker?

I recommend you call your bank.

Yes, that’s right; I’m a commercial mortgage broker and I am telling you to start with your bank (unless you are already out of time).

Most business people have financial resources, a good credit rating and a relationship at a chartered bank or credit union.

Common sense says: start with a commercial account manager at your bank. Take your documents with you: financial statements, your mortgage request (written down), latest appraisal (if completed) and any lease agreements. Tell your account manager you want indicative rates and fees before moving forward with a mortgage application.

Spend thirty minutes in the manager’s office, no longer. Do this quickly; don’t waste time. After all, this is just one lender and you have no idea whether your bank is competitive or even if it wants to do the loan. Tell your banker you need an answer in two days. If the account manager cannot give you an indicative rate and fees in a short timeframe, you are speaking with someone who will ultimately cause you headaches down the road.

Once you have the bank’s rates and fees, it’s time to verify the information with a commercial mortgage broker who has access to multiple lenders. Now, you could call ten lenders yourself, but again, common sense says that would be a waste of time.

Call your friendly neighborhood Dominion Lending Centres commercial mortgage broker

Depending on who you call, the commercial mortgage broker will do one of three things:

• ask you to sign a representation agreement,

• give you a song and dance about the low rates they have achieved for clients, or

• tell you the truth.

Top commercial mortgage brokers cut to the truth.

Why? They are busy. They don’t waste time on deals they can’t close.

As a commercial mortgage broker, it makes no sense to sign a representation agreement until I know I can add value. Step one is simply to determine whether the mortgage is bankable. To do this, I need documents. Yes, top commercial mortgage brokers are like bankers. With the right information, transactions can be digested in 20 minutes and can be summarized in six pages or less.

Top commercial mortgage brokers say things like:

• Tell me about your deal in 5 minutes or less; nature of transaction, deal size, legal structure, cash flow, quality of financials and timeline.

• What documents can you send me? I’ll review them in 24 hours and call you back.

• Have you called your bank yet? What rate did they give you?

Tell your commercial broker the truth. If your bank offered 4.5% fixed for 5 years then say so. Why? Because no one wants to waste time. Your commercial mortgage broker doesn’t set the rates; the lenders do. Your commercial mortgage broker knows when a rate makes sense and whether lower rates are available. For example, if I can’t save you 25 basis points (that’s 0.25% per year), the reality is, by the time we pay to move the mortgage to another lender, you’re probably better off taking your bank’s initial offer.

Top commercial mortgage brokers understand this, and they will be truthful with you.

“Hey, if you have 4.5% fixed in this market for that building, in that area; take it, don’t hesitate; it’s a good deal.” I say this to entrepreneurs who call. It serves no one to enter an agreement that won’t add value. In fact, its our fiduciary duty to tell you.

Some entrepreneurs say they already have good rate (even when they don’t). “Oh, my bank offered me between 4.6 and 5.2%.” The thinking being, if they imply they have 4.6%, then the broker will work even harder to get a lower rate.

Beep. Wrong.

Brokers don’t set the rates; lenders do. This just muddies the water. If the broker thinks you already have a good rate (and best-in-market is 4.5%, only 10 basis points less), then the broker will move on right away.

About Commercial Mortgage Brokers

All a commercial mortgage broker wants, is serve you; and that means delivering the best rates and terms. There is no financial incentive for a broker to hold back information or low rates. Similarly, holding back your bank’s interest rate just wastes everyone’s time, including yours.

As a commercial mortgage broker, if I think I help you, I’ll tell you right away. I’ll review the deal quickly, determine if its bankable and touch base with a few lenders. If lenders express interest, I’ll call you to discuss what they told me.

Transparency and open communication are the keys to saving time and to getting the most from your commercial mortgage broker.

If you are getting a runaround and want the straight scoop, call me.

PIERRE PEQUEGNAT

Dominion Lending Centres – Principal Broker
Pierre is part of DLC Sherlock Mortgages based in Toronto, Ont

As expected, growth in the fourth quarter of last year paled in comparison to the robust performance of the first half. Statistics Canada revised up growth estimates for the first half of the year to 4.2%, from the initial estimate of 4%. Following economic expansion of a whopping 4.0% in Q1 and 4.4% in Q2, the second half slowed to a downward revised 1.5% in Q3 (posted initially at 1.7%) and 1.7% in Q4 (see table below, gratis CIBC Economics). Second half growth was about in line with the Bank of Canada’s assessment of long-run noninflationary potential growth. First-half growth was driven by robust consumer spending, particularly for durable goods, as well as strength in business investment. Residential construction was also a meaningful net contributor to expansion early last year.

The 2.9% expansion in the Canadian economy in 2017 was the fastest pace since 2011 following the tepid 1.4% growth pace of 2016. The unexpected strength allowed the federal government to post significantly smaller budget deficits for fiscal years 2017 and 2018 as announced in the October budgetary update. This week’s federal budget, however, showed that Ottawa chose to increase spending to offset these improvements, maintaining a double-digit deficit trajectory over the next five years. Rapid growth last year pushed the economy to full employment as labour markets improved dramatically. Now is not the time, therefore, for additional fiscal stimulus. Instead, it would have been more prudent to return the federal budget to a balanced position, particularly in light of potential risks to the economy in the future. As another round of NAFTA negotiations commence in Mexico city, we cannot help but be concerned about threats to Canada’s trade outlook.

Just yesterday, President Trump announced he intended to slap tariffs of 25% on steel imports and 10% on aluminium imports. Canada is the most significant supplier of foreign steel to the U.S. This announcement was roundly condemned by the international community. As always with Trump, details are uncertain, but according to Bloomberg News, the implications rippled through the seventh round of talks on the North American Free Trade Agreement in Mexico City.

Canada threatened to fire back if the U.S. makes good on this pledge, but held out hope that it could be exempt. The Canadian dollar is tied with the Mexican peso as the worst performing major currencies over the past month and is one of the worst performing over the past six months. The Canadian dollar was little changed after the GDP report.

London-based Rio Tinto, which ships more than 1.4 million metric tons of aluminium to the U.S. annually from Canada, said it would continue to lobby Washington for an exemption given the highly integrated Canada-U.S. market for autos and other manufactured goods.

“Aluminum from Canada has long been a reliable and secure input for U.S. manufacturers – including the defence sector,” Rio Tinto spokesman Matthew Klar said by email according to a report from Bloomberg News. “We will continue to engage with U.S. officials to underscore the benefits of the integrated North American aluminium supply chain, including the jobs it supports on each side of the border.” Also, shares of Canadian steel producer Stelco Holdings fell as much as 6.1%. The U.S. accounted for about 14% of Stelco’s sales in the last six months of 2017. Chief Executive Officer Alan Kestenbaum said on the company’s earnings call last week that he was hopeful Canada would be exempt from the tariffs.

Canadian Foreign Minister Chrystia Freeland fired back that, “it is entirely inappropriate to view any trade with Canada as a national security threat to the United States. Should restrictions be imposed on Canadian steel and aluminium products, Canada will take responsive measures to defend its trade interests and workers.”

Trump tweeted early this morning that, ‘trade wars are good and easy to win.’ There is not an economist in the world who agrees with this sentiment. What’s more, when U.S. prices for goods containing metals start to rise, inflation spikes and other countries start retaliating, President Trump will say “nobody knew that trade could be so complicated.” Hopefully, this is just more Trump nonsense, and cooler heads will prevail. But our government needs to have the ammo to cushion the economic effects of any such actions if NAFTA were to fall apart or Canadian businesses were hit with additional punitive tariffs. The Bank of Canada will indeed be very slow to raise rates in this environment, but fiscal stimulus should not be wasted on ineffective programs now when real stimulus might be needed as a counter-cyclical measure in the future.

The slowdown in the second half of last year was somewhat more than expected amid signs that indebted consumers have tamped down their spending sprees. Consumption growth in the fourth quarter was at its slowest pace since 2016. The deceleration in household spending was due in part to a higher savings rate, which increased to 4.2% in Q4, from 4.0% in Q3.

The underlying growth pace might be even slower than the fourth quarter figure suggests because of temporary strength in housing. Spending on residential structures surged to an annualized 13.4% in the final three months of last year, the most robust pace since 2012. The gain was led by unexpectedly strong new home construction, and the buyers rush to close home purchases before tighter mortgage qualification rules came into effect. We have already seen a marked slowdown in housing activity in the new year.

The jump in residential spending accounted for one percentage point of the 1.7% growth pace according to Statistics Canada. Residential investment had been a drag on growth in Q2 and Q3.

Exports recovered in Q4 after plunging in the third quarter, but it wasn’t enough to keep the trade sector from being a drag on growth as imports rose considerably. On a positive note, nonresidential business investment accelerated in Q4.

DR. SHERRY COOPER

Chief Economist, Dominion Lending Centres
Sherry is an award-winning authority on finance and economics with over 30 years of bringing economic insights and clarity to Canadians.

 

With changes to mortgage rules and interest rates on the rise here are some tips for your variable rate mortgage that could save you thousands.

Since 2009 the prime lending rate has shifted from a high of 6% down to 2% range remaining fairly level for the past few years before rising to a present day level of 3.45%. During that time, lenders have offered consumers high discount variable mortgage as low as 1.2% when rates were at their lowest, to current rates of 2.45 (depending on the lender and if the mortgage is insured or not).

Historically the choice of a variable rate mortgage over a fixed term has allowed borrowers to save in interest costs.

I always recommend if my clients can qualify and it makes sense for their specific situation to choose variable only if they will take full advantage of the lower rate. By setting their payment to the equivalent of the 5 year fixed rate at the time, the difference in payment goes directly to principal pay down.

Every 10% increase in payment shaves three years off the amortization of a five-year term so every bit extra matters and can make a difference.

If your mortgage is maturing in the next 90-180 days, it is time to talk to your Dominion Lending Centres mortgage professional for tips for your variable rate mortgage that could save you thousands.

You may feel the pressure to lock in to a fixed rate after the recent increases in the prime lending rate. For some this may be an option. However, I have the same advice every time someone asks me this question: It depends on your situation and we need to do a review. Take the extra time to review the current rate, remaining term of the mortgage, the new offer, how that will impact payments and your plans for staying in your home, moving and/or if this is an investment property.

For example Amy and Jake have a current balance of $300,000 on their mortgage with a variable rate at Prime minus .80% (2.65%). Current payments set at $703 bi-weekly. The mortgage matures in 24 months but they are considering to lock in for a new five-year term offered at 3.34%. New payments would be $739. They love their condo but not sure if they will stay or move in two years or not.

After a review of their mortgage we offer a second option. Keep the remaining variable rate mortgage in place for the remaining two years. Set payments at 3.34% or $739 bi-weekly.

They decide on this second option because:

• In 24 months the savings on interest is $4,000 and their outstanding balance is $4,000 less than by staying in the fixed rate
• They won’t be locked into a mortgage for another five years
• If they choose to sell before the maturity date, the penalty on a variable mortgage is only three months interest
• In two years they can either choose to stay with the same lender or move to another lender without penalty

With this strategy they don’t have to feel pressured into locking in today and they can continue to take advantage of the lower variable rate.

So if you are in a variable rate mortgage and not sure what to do. Remember my tips for your variable rate mortgage that could save you thousands.

PAULINE TONKIN

Dominion Lending Centres – Accredited Mortgage Professional
Pauline is part of DLC Innovative Mortgage Solutions based in Coquitlam, BC.

 

While most people know the main things they need to buy a home, such as stable employment and enough money for a down payment, there are a few other factors that may help you realize you’re ready, perhaps even earlier than you thought!

As a mortgage broker, it is my job to ensure that each one of my clients is getting the best service I can provide. Part of this means educating as much as possible when it comes to buying a home, which is why I’ve put together a list of 4 signs that may tell you that you are ready to become a homeowner.

You should have more funds available than the minimum of a down payment
This one may seem obvious, but it’s something that people may not realize until they actually think about it. It’s very difficult to afford a home if you only have enough money for a down payment and then find yourself scrambling for day-to-day living after that.

If you have enough money saved up (more than the minimum needed for a down payment), you may be ready to start house-hunting.

Your credit score is good
This might seem obvious at first glance, however, if you don’t have a good credit score, chances increase that you could be declined altogether or stuck with a higher interest rate and thus end up paying higher mortgage payments. If you have a less-than-optimal credit score, working with a mortgage professional can help you get on the right track in the shortest time possible. Sometimes a few subtle changes can bump a credit score from “meh” to “yahoo” in a few short months.

Breaking the bank isn’t in your future plans
Do you plan on buying two new vehicles in the next two years? Are you thinking of starting a family? Are you considering going back to school?

Although you may think you can afford to purchase a home right now, it’s extremely important to think about one, two, and five years down the road. If you know that you aren’t planning on incurring big expenses that you need to factor into your budget anytime soon, then that’s something that may help you decide to buy a home.

You are disciplined
It’s easy to say, “it’s a home, I’m going to have it for a long time so I may as well go all-in!”. While that would be nice, that’s rarely the case!

You must have a limit that you’re willing to spend. Sitting down with a mortgage broker or real estate agent and analyzing your finances is crucial. It’s important that you know costs associated with buying a home and what the maximum amount is that you can afford without experiencing financial struggles. IMPORTANT: This is not the amount that you are told is your max!

This is the amount that you calculate as your max based on your current monthly budget and savings plan. It’s quite frequent where I have clients tell me that their max budget is, say, $1200 and then when I run the numbers they could actually be approved for much more. Low and behold suddenly these guys are looking at homes that are hundreds of dollars a month higher than their initial perceived budget. It is up to you (with my help or pleading, when necessary) to reel things back in and make sure that you aren’t getting into something that affects the long-term livelihood of a well thought out budget or savings plan.

Conclusion

These are just four signs that you may be ready to purchase a home. If you’re seriously considering buying or selling, talking with a Dominion Lending Centres mortgage broker, such as myself, can help put you on the right path to a successful real estate transaction.

SHAUN SERAFINI

Dominion Lending Centres – Accredited Mortgage Professional
Shaun is part of DLC Canadian Mortgage Excellence based in Lethbridge, AB.

Fixed Interest Rates

This is usually the more popular choice for clients when it comes to deciding on which type of interest rate they want. There are many reasons why, but the most unsurprising answer is always safety. With a fixed interest rate, you know exactly what you are paying every month and you know that the amount of interest being charged for the term of your mortgage will not increase and it will not decrease. Fixed interest rates can be taken on 1-year, 2-year, 3-year, 5-year, as well as 7 and 10-year terms. Please note, term is not meant to be confused with amortization. When you have a 5-year term but a 25-year amortization- the term is when your mortgage is up for renewal, but it will still take you the 25 years to pay off the entire debt. The biggest knock on fixed interest rates when it comes to mortgages, especially 5-year terms, is the potential penalty. If you want to break your mortgage and pay it out, switch lenders, take advantage of a lower rate, or anything like this and your term is not over, there will be a penalty. With a 5-year term, a fixed rate penalty can be anywhere from $1,000- $20,000 or more. It all depends on the lender’s current rates, what yours currently is, the length of time remaining on your term, and the balance outstanding. The formula used is called an IRD (interest rate differential) and the penalty owed will either be the amount this formula produces or three month’s interest- which ever is greater. Fixed interest rates, especially 5-year terms can be the most favourable. They are safe, competitive interest rates that you will not need to worry about changing for the term of your mortgage. However, if you do not have your mortgage for the entire term, it could hurt you.

Variable Rate Interest

The Bank of Canada sets what they call a target overnight rate and that interest rate influences the prime rate a lender offers consumers. A variable rate, is either the lender’s prime lending rate plus or minus another number. For example, let us say someone has a variable interest rate of prime minus 0.70. If their lender’s prime lending rate is 5.00% in this example, they have an effective interest rate of 4.30%. However, if for example the prime rate changed to 6.00%, the same person’s interest rate would now be 5.30%. Written on a mortgage, these interest rates would look like P-0.7. Variable interest rates are usually only available on 5-year terms with some lenders offering the possibility of taking a 3-year variable interest rate. When it comes to penalties, variable interest rates are almost always calculated using 3-months interest, NOT the IRD formula used to calculate the penalty on a fixed term mortgage. This ends up being significantly less expensive as breaking a 5-year term mortgage at a fixed rate of 3.49% with a balance of $500,000 will cost approximately $15,000. That is if you use the current progression of interest rates and broke it at the beginning of year 3. A variable interest rate of Prime Minus 0.5% with prime rate at 3.45% will only cost $3,800. That is a difference of $11,200. You can expect to pay this kind of amount for the safety of a fixed rate mortgage over 5-years if you break it early.

Which one is best?

It completely depends on the person. Your loan’s term (length of time before it either expires or is up for renewal) can be anywhere from a year to 5 years, or longer. A first-time home buyer typically has a mortgage term of 5 years. Within those 5 years, the prime rate could move up or down, but you won’t know by how much or when until it happens. Recently, variable rates have been lower than fixed rates, however, they run the risk of changing. With fixed interest rates, you know exactly what your payments will be and what it will cost you every month regardless of a lender’s prime rate changing. If you go to the site www.tradingeconomics.com/canada/bank-lending-rate you can see the 10-year history of lender’s prime lending rate. Because lenders usually change their prime lending rate together to match one another (except for TD), this graph is a good representation. As you can see, from 2008 to 2018, the interest rate has dropped from 5.75% to 2.25% all the way back up to 3.45%.  Canada has had this prime lending rate since 1960, and in that time it has seen an all-time high of 22.75% (1981) and all-time low of 2.25% (2010). Whether you want the risk of variable or the stability of a fixed rate is up to you, but allow this information to be the basis of your decision based on your own personal needs. If you have any questions, contact a Dominion Lending Centres mortgage professional near you.

RYAN OAKE

Dominion Lending Centres – Accredited Mortgage Professional
Ryan is part of DLC Producers West Financial based in Langley, BC.

Patting himself on the back, the Finance Minister opened his speech by reminding us that “a little over two years ago…Canadians had the opportunity to stay the course. They could stick with a Government that favoured cuts and a set of failed policies that produced stubborn unemployment and the worst decade of economic growth since the depths of the Great Depression.” This, of course, was Stephen Harper’s Conservative Government. Never mind that the global financial crisis caused the recession, not the “failed policies” of the previous government. Throughout the budget documents, the message is that austerity was “needless” or “excessive.” Instead, Canadians chose, “a more confident and more ambitious approach…that gave Canadians the tools they needed to succeed. Starting with raising taxes on the wealthiest, so we could lower them for the middle class.”

The Liberals have forgotten their promise to run deficits no larger than $10 billion and to balance the budget by 2019. Instead, they now see sound fiscal management as a declining debt-to-GDP ratio—never mind that double-digit deficits remain as far as the eye can see—to a stunning $12.3 billion deficit at the end of the forecast horizon in fiscal year (FY) 2022-23.

The deficit figures have indeed improved—down more than $2.0 billion in FYs 2017 and 2018–thanks to the stronger-than-expected economy and rapidly reduced unemployment last year. But, initiatives in today’s federal budget add $6.3 billion to the current year’s (ending March 31, 2018) budget deficit, $5.4 billion to next year’s federal red ink and an additional $2.0-to-$3.0 billion annually over the forecast horizon ending in FY 2022-23 (see Table below).

Fortunately, Canada has by far the lowest debt-to-GDP ratios in the G7, reflective of the austerity programs of the past, beginning in the mid-1990s and continuing until the financial crisis in 2008-09 when counter-cyclical global fiscal policy was essential to assure financial stability and rebounding economic activity by late-2009. While the U.S. and much of the rest of the developed world suffered the longest and deepest recession since the Great Depression, Canada’s was the shortest and mildest recession in the postwar period—contrary to the impression left by the Finance Minister in his opening remarks.
Thanks to this backdrop, the debt-to-GDP ratio in Canada will continue to decline despite continued fiscal stimulus. The ratio is forecast to gradually edge downward from 30.4% this year to 28.4% in 2022-23, assuming the economy continues to grow. Clearly, all bets are off if we hit a pothole, such as the end of NAFTA or a recurrence of plunging oil prices.

Budget 2018 proposes to:

• Put more money in the pockets of those who need it the most, by improving access to the Canada Child Benefit and introducing the Canada Workers Benefit, a stronger and more accessible benefit that will replace the Working Income Tax Benefit.

• Make significant progress towards equality of opportunity, by taking leadership to address the gender wage gap, supporting equal parenting, tackling gender-based violence and sexual harassment, and introducing a new entrepreneurship strategy for women.

• Support the next generation of researchers, by providing historic funding to increase opportunities for young researchers and provide them the equipment they need, while strengthening support for entrepreneurs to innovate, scale up and reach global markets.

• Advance reconciliation with Indigenous Peoples, by helping to close the gap between the quality of life of Indigenous and non-Indigenous people, providing greater support to keep First Nations children safe and supported within their communities, accelerating progress on clean drinking water, housing, and employment, and supporting recognition of rights and self determination.

• Protect the environment for future generations, by making historic investments to preserve our natural heritage, ensuring a price is put on carbon pollution across Canada, and extending support for clean energy projects.

• Uphold Canada’s shared values and support the health and wellness of Canadians, by partnering with provinces and territories to address the opioid crisis, taking action to advance national pharmacare, and bolstering support for Canada’s official languages.

This list summarizes 367 pages of more than 100 relatively small government initiatives impacting everything from Workers Benefits payments to low-income families, improving access to the Canada Child Benefit to supporting opportunities for women, pay equity for federal workers, strengthening trade, improving worker skills, and cracking down on tax evasion—all of this among the roughly 25 government actions described in Chapter 1 under the heading of Growth. The details of changes in the rules regarding the holding of passive investments inside private corporations as well as closing tax loopholes fall under this Growth rubric.

Chapter 2, called Progress, includes more than 35 initiatives under the headings of Investing in Canadian scientists and researchers, Stronger and more collaborative Federal science, and Innovation and Skills Plan—a more client-focussed Federal partner for business.

Chapter 3, Reconciliation, largely deals with Indigenous Peoples, including roughly 20 actions.

And finally, Chapter 4, called Advancement, covers the environment under Canada’s Natural Legacy, Canada and the World, Upholding Shared Values, and Security and Access to Justice. I lost count here at over 40 initiatives.

And, that’s not all! A bonus section called Equality, goes into detail regarding Canada’s commitment to gender budgeting, which includes $6.7 million over five years for “Statistics Canada to create a new Centre for Gender, Diversity and Inclusion Statistics, a Centre that will act as a Gender Budget Accounting data hub to support future, evidenced-based policy development and decision-making”.

I kid you not. At my rough count, I have been to 34 budget lock-ups, but I can’t remember ever seeing anything like this for sheer magnitude of the number of relatively tiny initiatives, nor can I ever remember leaving a lock-up with such a screaming headache.

DR. SHERRY COOPER

Chief Economist, Dominion Lending Centres
Sherry is an award-winning authority on finance and economics with over 30 years of bringing economic insights and clarity to Canadians.

When I started working as a broker in 2005, the mortgage industry and the financial industry in general weren’t very eco-friendly. Let’s face it. When someone buys a home, there’s a paper trail. Starting with the mortgage pre-approval which can run four pages,  the Offer to Purchase, which is another 12 pages, income documents, notices of assessment, appraisal, and MLS listing condo documentation to add to the pile of paper. Often you would end up with a stack of paper 50-60 pages high. I needed a copy, the lender needed a copy and then my broker needed to keep a copy on file for seven years. I found that I was going to Staples and buying a case of 5,000 sheets of paper every year. I recall going to my broker’s office and seeing the admin assistant struggling to find a place to put another big box of files as the storage room was full.
What a difference a few years makes. Lenders started to accept documents in PDF format, saving us from faxing them, while brokers and lenders started to use secure servers to store the documents and the paper pile dropped for me from 5,000 sheets a year to less than 500. With photo scanning apps on phones, I expect that the paperwork will continue to shrink.
However, there are other signs of greening in the financial sector. Products like CMHC’s Purchase plus Improvements allow us to encourage our clients to change their windows and doors for more energy efficient ones, adding insulation and putting the renovations into their mortgage. In addition, if the repairs result in an Ener-guide reading of more than 82, or if they buy a new Built Green Canada home, they can qualify for a 15% rebate in their mortgage default insurance premiums.
We may not be building windmills or using solar power, but the Mortgage Industry has definitely become greener in the past decade. If you have any questions, contact a Dominion Lending Centres mortgage professional near you.

DAVID COOKE

Dominion Lending Centres – Accredited Mortgage Professional
David is part of DLC Clarity Mortgages in Calgary, AB.