Ian Leverington's Blog

Just like a mortgage, the small differences in interest rates from one option to the next won't make a huge difference month to month. Over several years though, it can add up substantially! Example of a savings return of .20% vs 2.00% interest: Say you started with $10,000 in savings, plus you deposited an extra $200 each month. At .20% interest you'd earn an extra $172.59 after 5 years (...wow). At 2.00% interest you would earn an extra $1,780.30 in same 5 years. This is simply by doing the same thing you were already doing at your current bank but, you'll get back an extra $1,607. In a little more than 10 years it would turn into an extra $5,000. This is also partly thanks to  compound interest . The thing is, if you've built up a savings account, you've worked hard for it so you'd be silly to not make your money continue to work hard for you. I would agree that finding the best place to invest your money may be tough but, finding a better place to h

Recently, the Feds (OSFI) announced a new set of lending guidelines for all regulated banks and lenders beginning January 1st, 2018. The worst change for some is the 'stress test' for all borrowers. In October 2016, we saw a similar rule for borrowers with less than 20% down to qualify under a 'stress test'. Now, those with more than 20% down will have to face similar qualifying guidelines as well. These borrowers need to first qualify at the greater of the 5 year benchmark rate (currently 4.99%) or their actual rate + 2.00%. There's only a little bit of time left for borrowers with 20% down or more to qualify at their actual contract rate. The Pros With interest rates on the rise, this actually makes sense as it will help add a level of prevention from borrowers from getting in over their heads. It should also be a somewhat effective measure to help slow the Toronto and Vancouver markets. The Cons All borrowers will qualify for about 21% less. This will cre