Trouble in ‘mortgage land’ as higher borrowing rates weigh and refinancings dry up — via financialpost RealEstate
David Larock, a mortgage broker and president of Toronto-based Integrated Mortgage Planners Inc., said he is definitely seeing a drop-off in business in light of the new conditions, but said he’s seeing different effects when it comes to refinances versus new purchases.
Larock said this is because for a while, clients looking to refinance were breaking a mortgage with a higher rate than the refinance rate, offering a tailwind — particularly as the pandemic brought ultra-low rates to the market. This business, he said, has been hit hard now that rates are rising aggressively.Article content
On the purchase side, Larock noted it was a challenge to determine whether the slowdown in new residential mortgage originations stems from a typical summer season lull, or if more clients are in wait-and-see mode to see if prices could go lower. Clients seeking new mortgage originations have tended to be less conventional and require more flexibility. One example: the number of mortgage-seekers in the gig economy who are moving towards private financing.Article content
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