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Lightcycle said:
Prices are not coming down as long as the banks keep allowing their customers to defer mortgage payments.

If I was over-leveraged, the last thing I'd do is sell at a loss if I can kick the ball down the line and extend my mortgage length...

And the last thing the banks want their customers to do is default on their mortgages.
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Condos could take a beating. I doubt houses will. Those air bnb condos are not eligible for a mortgage punt. Those stuck in a condo with multiple children will want out. All of those that owned for more than a few years will still be up wet purchase price even with a correction. It will be a race to get them sold before the fall continues.
 
GreyGhost said:
I could see the fallout from this having buyers try to keep the financing condition alive until just before closing. I have always included it but then lifted it pretty far before closing.
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House would continue to stay on the market until all conditions have been waved. Other wise it's just an offer and not an agreement to purchase.
 
Couple questions I have regarding detached, are banks going to be lending money as easily as they have been? Also the big potential for further job loss. Yeah working from home for the time being is fine for a lot of people but business is down and if it doesn’t come back the same way are a lot of $100,000 jobs going to be $60,000 jobs?

Possible mortgage rates rise as a safety cushion for the banks as well even though the Bank of Canada rate is down. Couple points on a big boy mortgage can hurt.

@GreyGhost I agree, for sure see people leaving the city condos for the suburbs and see an uptick in that market.
 
blackcamaro said:
Couple questions I have regarding detached, are banks going to be lending money as easily as they have been? Also the big potential for further job loss. Yeah working from home for the time being is fine for a lot of people but business is down and if it doesn’t come back the same way are a lot of $100,000 jobs going to be $60,000 jobs?

Possible mortgage rates rise as a safety cushion for the banks as well even though the Bank of Canada rate is down. Couple points on a big boy mortgage can hurt.

@GreyGhost I agree, for sure see people leaving the city condos for the suburbs and see an uptick in that market.
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Obviously we are in uncharted territory but....having been through the dotcom and 08 meltdowns I thought for sure there would be problems getting access to loans/money, even locked in rates thinking that they would spike due to lack of liquidity---maybe some very short term issues, not much more.... I was proven wrong both times so on that I won't guess.
 
crankcall said:
It's going to be interesting, if you put down $50K on a million dollar house. And it drops 100k, do you walk? it doesnt affect your credit rating , you claim you couldn't get financing (provided you didnt wave conditions) . Then you buy in at the 100k off list, and ANY agent will take your offer.

If i had a house in play right now i'd be worried about getting the deal closed.
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Wouldn't the conditional offer protect the buyer from losing their deposit?
if it was a non conditional offer and you walked from sale, leaving your deposit.. the seller could come after you.. and probably would if they couldn't get the same price elsewhere.
 
raginduck said:
Wouldn't the conditional offer protect the buyer from losing their deposit?
if it was a non conditional offer and you walked from sale, leaving your deposit.. the seller could come after you.. and probably would if they couldn't get the same price elsewhere.
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The problem is most people with a financing condition clear it within weeks of the offer being accepted. Then you typically have one to two months wait before the closing date. Banks are not closing if you are unemployed. At that point, you dont get the house you thought you were going to get and are also likely sued and lose for diminished value. The buyer could easily lose a few hundred thousand on a house they never owned. Bollocks.

The question I am interested in, but havent seen addressed is extra capital to keep the ratio against an asset with an appraisal that had dropped sharply. Say you were putting 20% down on a $one million house. Not the best plan, but probably not uncommon. What is the fair market value on that house right now? Where are buyers going to come up with 100K plus to keep the ratio?
 
mimico_polak said:
Interesting point. My buddy is currently waiting for his closing date at the end of May and he said that the bank / broker is calling him every week to confirm that he's still employed. The house is already bought so not like he can walk away from his deposit, but I'm not sure if he considered it. So far it looks like it's a go and they're moving.
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That's not the bank calling, its the broker.

The only reason the broker is calling is because he's spent the commission cheque he will get once you deal closes -- no closing, no commission.
 
I still see some american conservatives losing their minds that going to church is banned for a few weeks so..:
https://imgur.com/zhUCtCN
 
raginduck said:
Wouldn't the conditional offer protect the buyer from losing their deposit?
if it was a non conditional offer and you walked from sale, leaving your deposit.. the seller could come after you.. and probably would if they couldn't get the same price elsewhere.
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A conditional offer means the house is still available to someone making a firm offer. We had it happen and didn't want to firm up until our house was sold. Interest rates were 13% at the time so bridge financing wasn't an option. We were given a day or two to either firm up or drop out.

We were disappointed at first but ended up with a better deal a couple of weeks later.
 
So, are we flattening the curve yet?
 
bigpoppa said:
BC has, ontario and quebec not so much
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Weird about that I saw an article about someone that looked like "Florida man", out protesting in B.C.
 
bigpoppa said:
BC has, ontario and quebec not so much
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Yeah I don't know where we are. There are good amount of Covid patients on vents where my wife works. They are not overwhelemed though.

Less joyriders tonight. I had 6 passed out at one point. Lately security is more amenable and responsive to getting them off the bus. It used to be that I would cart these people around all night. With so many drivers freaking out about social distancing at least security ia stepping up where they can.

Sigh... Just the same I can count on less than 2 hands the number of people that actually needed the bus to go somewhere.

Would be better to implement a dial a ride type thing like some other municipalities are doing.

Sent from my SM-G950W using Tapatalk
 
Mortgage rates have jumped 10 times in the last three weeks. Not the sign on the bank page, the actual numbers being offered on deals on the table. Gal in our regular 'social conference call' is a mortgage broker, indepenant of the banks.
Its started, people that had offers in are being declined due to "unstable employment future" , ability to repay (which is everything at the bank) and the ripple from the pond will be long. Its going to be harder to get money, the mortgage you easily qualified for last summer will be scutinized and nobody wants to be the guy that signed off on the deals that go south (bad career move)
 
crankcall said:
Mortgage rates have jumped 10 times in the last three weeks. Not the sign on the bank page, the actual numbers being offered on deals on the table. Gal in our regular 'social conference call' is a mortgage broker, indepenant of the banks.
Its started, people that had offers in are being declined due to "unstable employment future" , ability to repay (which is everything at the bank) and the ripple from the pond will be long. Its going to be harder to get money, the mortgage you easily qualified for last summer will be scutinized and nobody wants to be the guy that signed off on the deals that go south (bad career move)
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Are they reneging on pre approved mortgages or are buyers waiting to see if there is a rate drop and leaving themselves open to a reversal?
 
nobbie48 said:
Are they reneging on pre approved mortgages or are buyers waiting to see if there is a rate drop and leaving themselves open to a reversal?
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Pre-approval assumes rate, income, downpayment percentage and property value all remain unchanged (or at the very least meet minimum criteria). In the current situation, probably all four of those are changed for many families. If you have a big downpayment (say 30%+), I would hope the lenders could overlook a temporary covid-related income blip. The lender is protected by the equity. From stories I have heard, that is not happening right now.
 
nobbie48 said:
Are they reneging on pre approved mortgages or are buyers waiting to see if there is a rate drop and leaving themselves open to a reversal?
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GreyGhost pretty much covered it, a preapproval means you met all the criteria on the day you were "preapproved" . It's really only a guideline and not an actual guarantee the lender will transfer the money on the day required.
Last day before the deal closes they will check everything you said, run a credit report and reasess. Its to make sure you didnt go buy a car/trailer or get another 25K credit card, because now you may not qualify.

yes idiots while buying a house will think, wow, I'm preapproved for a million, but I'm only spending $800 so I can lease that range rover for $1000 a month! I'm gold!! no, no your not.
 
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