Get Your Home Equity Loan Now – Before Jim Flaherty Ruins the Party on April 19th
As if the government didn’t have its hands in your pockets and into your business enough, they now want to limit how much – of your own money – you are allowed to access.
Unbelievable, but true. Starting April 19th the federal government will issue a law that will restrict the amount of money can borrow against your house in what is called a ‘home equity loan.’ The money you have tied up in equity is technically your money – 100% – but Finance Minister Jim Flaherty wants to make sure that you can’t access it all.
His goal is to tighten mortgage rules to crack down on speculators and discourage homeowners from taking on too much debt amid threats of an ‘overheating’ housing market and concerns of a housing bubble, about to burst.
Who suffers with stiffer regulation? The borrowers.
Want an insured mortgage? In order to qualify, you will have to meet the standards for a five-year fixed-rate mortgage even if the interest you are paying is less.
Want to borrow against your equity? The government will limit the amount Canadians can borrow on their homes from the current 95 per cent of the value to 90 per cent.
Want to buy? Forget it. You need a 20% down-payment now.
In practical terms, it means that on the average $337,000 home, homeowners will need to have the financial means to absorb an additional $2,500 in mortgage costs a year, the TD Bank says.
All is not lost. You can still get a home equity loan for up to 95% of your home’s value if you act before April 19th, when the new regulations come into play.
You can read more about the stringent regulations coming into effect on April 19th here: http://ca.news.finance.yahoo.com/s/16022010/2/biz-finance-finance-minister-cracks-speculators-tightens-mortgage-rules.html
Jimbo wants to put the brakes on.
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