Canadian Mortgages and the US Crisis

Canadian Mortgages and the US Crisis

Some of you may be wondering the impact the current US Financial crisis may have on the Canadian economy and the impact on Canadians seeking mortgages.

In Canada our lenders were much more conservative and didn't offer the aggressive mortgage products that the US lenders did. The exposure that Canadian mortgage lenders have is much different than that of the US. The aggressive US mortgage products were big contributors to the current US financial problems. The conservative Canadian mortgage lending practices have allowed us to remain separated from the US credit crisis.

In Canada, we are experiencing an economic slowdown, but nothing like what the US is experiencing. We are also yet to see rising inflation numbers despite the increase in the price of fuel. If we find ouselves in an inflationary environment we will see the impact with higher mortgage rates.

Bank of Canada has stated that they will continue to provide liquidity as required in order to support the stability of the Canadian financial system and the functioning of the financial markets.

The Canadian government is expected to keep interest rates low to stimulate the markets. The Canadian government has taken preventive measures to avoid the housing crisis in the US. As of October 15, 2008 Canadian Banks and mortgage lenders will no longer be able to offer 40 year ammortizations, 100% mortgage financing and minimum credit score requirements.

This will impact the have to become more strict therefor making it more difficult to obtain a mortgage from the big lenders in Canada. I've seen lenders become more and more stringent over the last year. =This approach started with mortgage lenders last year and has accelerated as the US continues to struggle. With that said, all lenders are still happy to provide mortgages to people that can prove income, have a down payment and good credit.

I'm a mortgage broker in Vancouver, BC and offer mortgages throughout BC at the best mortgage rates possible. Visit me at www.MyMortgageBC.com

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