ameldrum902

ameldrum902 t1_j5ix3y1 wrote

Reply to comment by loudifu in The dichotomy of FT by Johs92

I'm in Vancouver. There's a population here that bought at the peak with 2.5% interest rates. When it comes time to refinance it will be painful or you will just be paying more in the long run. And if market value drops below your trigger, you will need to pony up the difference upon refinancing. Housing payments already account for 50%+ of people's household income. People are over leveraged on extremely heavy debt loads also. You add up all these factors and I'd say there might be a storm brewing.

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ameldrum902 t1_j5huvs5 wrote

Reply to comment by dvo3000 in The dichotomy of FT by Johs92

Canadian banks hold too much consumer debt. Defaults would sink them. The numbers are in on this. I believe Scotiabank and TD were in the worst spot at the moment. I just hope we, the tax payers, aren't going to be on the hook for a 2008 style bail out.

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ameldrum902 t1_j5ht0w8 wrote

Reply to comment by dvo3000 in The dichotomy of FT by Johs92

I know 3 people, two with cibc and one with bmo, who got called to go fixed 5yr to drop their variable 5yr. One person I know took it because they had 3 years left on the floating variable mortgage they were currently in.

And the deferred principle payments, that was in the news for a bit a couple months back.

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ameldrum902 t1_j5gnfmq wrote

Reply to comment by ronincelwarrior in The dichotomy of FT by Johs92

Mortgages come in fixed and variable. Banks have been calling the variable holders and offering to go fixed mid-term on their mortgage lately in an attempt to prevent defaults. Those that are too deep are being offered to just pay the interest portion and defer the principal portion back into sum owed. The banks know people over leveraged themselves on property that has an over inflated price.

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