When you know exactly what you want for yourself or your business, the opportunities to acquire those things are easily recognizable.
Start by knowing what you want in an employee so that you can attract the ideal one.
Before you can even decide who the perfect team member will be, you must have a very solid idea of which tasks you would like them to perform.
Then, you need to profile the personality traits that will work well in your business.
Hiring your neighbour or relative because you are overwhelmed is not the way to build a strong team.
Monday, December 3, 2007
Wednesday, October 31, 2007
Couple highlites from the Federal Mini Budget
Personal Tax ChangesLowest personal income tax rate — The mini-budget proposes to reduce the lowest personal tax rate,which applies to taxable income up to $37,178 for 2007, to 15% (from 15.5%), retroactively toJanuary 1, 2007.Basic personal, spousal and wholly dependent relative amounts — The mini-budget proposes toincrease the amount used to compute the basic personal tax credit to $9,600 (from $8,929) for 2007and 2008, and to $10,100 in 2009 (indexed for later years). The mini-budget also proposes that theamounts used to compute the spousal and wholly dependent relative credits will be changed to matchthe basic personal amount for each of these years.For a single tax filer with income over about $38,000, the above personal tax changes will provideoverall tax savings of about $240 in 2007.
GST ChangesGST rate reduced — The government proposes to reduce the GST rate to 5% (from 6%) as of January 1,2008. The mini-budget sets out transitional rules that are similar to the rules that applied when the GSTrate was reduced to 6% as of July 1, 2006, including the following general transitional rules:o If GST becomes payable, or is paid without becoming payable, before January 1, 2008, the 6%rate applies.o If GST becomes payable on or after January 1, 2008, without having been paid before that day,the 5% rate applies.o If GST is paid on or after January 1, 2008, without having become payable before that day, the5% rate applies.Specific transitional rules are introduced for certain types of transactions, including sales of real property,deemed supplies, imported goods and taxable services and intangibles and taxable benefits.Excise tax — To ensure that the GST rate cut does not affect the overall price of cigarettes and othertobacco products, the federal excise duty on these products will increase accordingly as of January 1,2008.Provincial sales tax harmonization — The federal government notes that it is willing to work towardfederal-provincial sales tax harmonization with the five provinces that still impose retail sales taxes.However, the mini-budget does not appear to offer the provinces any concrete incentive for doing so.
GST ChangesGST rate reduced — The government proposes to reduce the GST rate to 5% (from 6%) as of January 1,2008. The mini-budget sets out transitional rules that are similar to the rules that applied when the GSTrate was reduced to 6% as of July 1, 2006, including the following general transitional rules:o If GST becomes payable, or is paid without becoming payable, before January 1, 2008, the 6%rate applies.o If GST becomes payable on or after January 1, 2008, without having been paid before that day,the 5% rate applies.o If GST is paid on or after January 1, 2008, without having become payable before that day, the5% rate applies.Specific transitional rules are introduced for certain types of transactions, including sales of real property,deemed supplies, imported goods and taxable services and intangibles and taxable benefits.Excise tax — To ensure that the GST rate cut does not affect the overall price of cigarettes and othertobacco products, the federal excise duty on these products will increase accordingly as of January 1,2008.Provincial sales tax harmonization — The federal government notes that it is willing to work towardfederal-provincial sales tax harmonization with the five provinces that still impose retail sales taxes.However, the mini-budget does not appear to offer the provinces any concrete incentive for doing so.
Monday, October 29, 2007
A little food for thought!
I receive weekly emails from Jim Rohn, whose a great motivational speaker and I thought today's was something worth showing as it can pertain to everyone. Have a read!
Miss a meal if you have to, but don't miss a book.Some people claim that it is okay to read trashy novels because sometimes you can find something valuable in them. You can also find a crust of bread in a garbage can, if you search long enough, but there is a better way.Most homes valued at over $250,000 have a library. That should tell us something.Everything you need for your better future and success has already been written. And guess what? It's all available. All you have to do is go to the library. And there's probably a library in every neighborhood.Some people read so little they have rickets of the mind.I now have one of the better libraries. I admit that I haven't read everything in my library, but I feel smarter just walking in it.Don't just read the easy stuff. You may entertained by it, but you will never grow from it.The book you don't read won't help.Books are easy to find and easy to buy. A paperback these days only costs six or seven dollars. You can borrow that from your kids!It isn't what the book costs; it's what it will cost if you don't read it.
Miss a meal if you have to, but don't miss a book.Some people claim that it is okay to read trashy novels because sometimes you can find something valuable in them. You can also find a crust of bread in a garbage can, if you search long enough, but there is a better way.Most homes valued at over $250,000 have a library. That should tell us something.Everything you need for your better future and success has already been written. And guess what? It's all available. All you have to do is go to the library. And there's probably a library in every neighborhood.Some people read so little they have rickets of the mind.I now have one of the better libraries. I admit that I haven't read everything in my library, but I feel smarter just walking in it.Don't just read the easy stuff. You may entertained by it, but you will never grow from it.The book you don't read won't help.Books are easy to find and easy to buy. A paperback these days only costs six or seven dollars. You can borrow that from your kids!It isn't what the book costs; it's what it will cost if you don't read it.
Tuesday, October 16, 2007
Overnight lending rate remains the same
The Bank of Canada chose not to raise interest rates this morning which is a positive.
They feel right now we're cruising along nicely. I've attached the article written by the Bank this morning. The next meeting is December 4th.
OTTAWA – The Bank of Canada today announced that it is maintaining its target for the overnight rate at 4 1/2 per cent. The operating band for the overnight rate is unchanged, and the Bank Rate remains at 4 3/4 per cent.
Against a backdrop of robust global economic expansion and strong commodity prices, information received since the July Monetary Policy Report Update (MPRU) indicates that the Canadian economy is now operating further above its production potential than had been previously expected. The core rate of inflation, which has been above 2 per cent for the past year, was 2.2 per cent in August. Total consumer price inflation fell temporarily in August to 1.7 per cent, having been above the 2 per cent inflation target since the spring.
Since the July MPRU, the outlook for the U.S. economy has weakened because of greater-than-expected slowing in the housing sector. The Bank has revised down its projection for U.S. growth to 1.9 per cent in 2007 and 2.1 per cent in 2008. U.S. growth is expected to pick up to 3 per cent in 2009.
The Canadian dollar traded in a range of 93 to 95.5 cents U.S. in July and August, but since then it has appreciated sharply to as high as 1.03 dollars U.S. In the Bank's new base-case projection, the Canadian dollar is assumed to average 98 cents, the mid-point of the range since the July MPRU. As well, there has been a tightening of credit conditions stemming from the financial market developments this summer. For Canada, the Bank assumes that the cost of credit for firms and households relative to the overnight rate will be 25 basis points higher over the projection period than it was prior to the summer developments.
Despite these tighter credit conditions, momentum in domestic demand in Canada is expected to remain strong. The combined effect of a weaker U.S. outlook and a higher assumed level of the Canadian dollar implies, however, that net exports will exert a more significant drag on the economy in 2008 and 2009 than previously expected. As a result, the Canadian economy is projected to grow by 2.6 per cent in 2007, 2.3 per cent in 2008, and 2.5 per cent in 2009. This growth profile implies that aggregate supply and demand will move back into balance in early 2009. Both core and total CPI inflation are projected to return to 2 per cent in the second half of 2008.
In line with this projection, the Bank judges, at this time, that the current level of the target for the overnight rate is consistent with achieving the inflation target over the medium term.
There are significant upside and downside risks to the Bank's inflation projection. On the upside, excess demand in the Canadian economy could persist longer than projected. This could come from two sources: higher growth in household spending than projected and lower growth in productivity than assumed. On the downside, if the Canadian dollar exchange rate were to persist above the 98 cent U.S. level assumed over the projection horizon for reasons not associated with stronger-than-projected demand for Canadian products, Canadian output and inflation would be lower. In addition, the effect of the past appreciation of the Canadian dollar on demand and inflation could be stronger than expected and the effect of the weakness in the U.S. housing sector could be greater than anticipated. All factors considered, the Bank judges that the risks to its inflation projection are roughly balanced, with perhaps a slight tilt to the downside.
They feel right now we're cruising along nicely. I've attached the article written by the Bank this morning. The next meeting is December 4th.
OTTAWA – The Bank of Canada today announced that it is maintaining its target for the overnight rate at 4 1/2 per cent. The operating band for the overnight rate is unchanged, and the Bank Rate remains at 4 3/4 per cent.
Against a backdrop of robust global economic expansion and strong commodity prices, information received since the July Monetary Policy Report Update (MPRU) indicates that the Canadian economy is now operating further above its production potential than had been previously expected. The core rate of inflation, which has been above 2 per cent for the past year, was 2.2 per cent in August. Total consumer price inflation fell temporarily in August to 1.7 per cent, having been above the 2 per cent inflation target since the spring.
Since the July MPRU, the outlook for the U.S. economy has weakened because of greater-than-expected slowing in the housing sector. The Bank has revised down its projection for U.S. growth to 1.9 per cent in 2007 and 2.1 per cent in 2008. U.S. growth is expected to pick up to 3 per cent in 2009.
The Canadian dollar traded in a range of 93 to 95.5 cents U.S. in July and August, but since then it has appreciated sharply to as high as 1.03 dollars U.S. In the Bank's new base-case projection, the Canadian dollar is assumed to average 98 cents, the mid-point of the range since the July MPRU. As well, there has been a tightening of credit conditions stemming from the financial market developments this summer. For Canada, the Bank assumes that the cost of credit for firms and households relative to the overnight rate will be 25 basis points higher over the projection period than it was prior to the summer developments.
Despite these tighter credit conditions, momentum in domestic demand in Canada is expected to remain strong. The combined effect of a weaker U.S. outlook and a higher assumed level of the Canadian dollar implies, however, that net exports will exert a more significant drag on the economy in 2008 and 2009 than previously expected. As a result, the Canadian economy is projected to grow by 2.6 per cent in 2007, 2.3 per cent in 2008, and 2.5 per cent in 2009. This growth profile implies that aggregate supply and demand will move back into balance in early 2009. Both core and total CPI inflation are projected to return to 2 per cent in the second half of 2008.
In line with this projection, the Bank judges, at this time, that the current level of the target for the overnight rate is consistent with achieving the inflation target over the medium term.
There are significant upside and downside risks to the Bank's inflation projection. On the upside, excess demand in the Canadian economy could persist longer than projected. This could come from two sources: higher growth in household spending than projected and lower growth in productivity than assumed. On the downside, if the Canadian dollar exchange rate were to persist above the 98 cent U.S. level assumed over the projection horizon for reasons not associated with stronger-than-projected demand for Canadian products, Canadian output and inflation would be lower. In addition, the effect of the past appreciation of the Canadian dollar on demand and inflation could be stronger than expected and the effect of the weakness in the U.S. housing sector could be greater than anticipated. All factors considered, the Bank judges that the risks to its inflation projection are roughly balanced, with perhaps a slight tilt to the downside.
Thursday, September 20, 2007
Discounts off of Prime. (Variable rate mortgages)
In layman’s terms, what is happening?
Adjustable Rate Mortgages are typically priced according to the current 30-day Banker Acceptances (BA), which are a very common short-term money market investment, guaranteed by the banks. A lender funding adjustable/variable rate mortgages would typically borrow money through a 30-day Banker’s Acceptance. The lender is then responsible for paying the yield (rate of return) to the investor who purchased the BA. This yield is the cost of funding mortgages (“Cost of Funds”) to the lender.
So, what’s happening to the BA yields?
This is where the story has become interesting over the past few months.
The failure of the U.S. subprime market worried money-market investors. In Canada, investors began to sell off investments creating a strain on the market. Those who remained demanded higher yields from the BA market as no one was sure as to how much of these BA’s were used to finance U.S. subprime mortgages, or subprime mortgages here in Canada or other risky ventures. Everyone was asking the same thing: What’s the risk exposure? A classic example of the market overreacting.
The resulting increase in BA yields increased the cost of funds for lenders who want to finance their Adjustable Rate Mortgages. Essentially it’s costing lenders much more money now to finance ARMs than it did 60 days ago.
The following is a comparison of 30-day Banker’s Acceptance yields over the past 60 days:
July 17, 2007: 4.54%
August 3, 2007: 4.60%
August 14, 2007: 4.75%
August 17, 2007: 4.92%
September 11, 2007: 4.98%
September 17, 2007: 5.04%
*Source: Bank of Canada (www.bank-banque-canada.ca)
So, in 60 days we’ve seen the yield on 30 day BA increase 50 bps.
Now consider the interest rate earned by the lenders on an ARM at Prime - .90%. Today that interest rate is 5.35%. When you compare this to the current Cost of Funds at 5.04%, which doesn’t include overhead, profit margin (or any origination fees paid to mortgage originators), one can see that it’s only a matter of time before prices for ARMs need to change.
How long will this continue?
Are we seeing the end of the days of Prime - .90%? Perhaps for a while, until the money markets settle down.
The silver lining in all this is that due to Canada’s continued economic expansion and the reality of an $80+ barrel of oil, our longer term bonds are in high demand. As a result, we might see some interest rate decreases on the fixed rate products.
Adjustable Rate Mortgages are typically priced according to the current 30-day Banker Acceptances (BA), which are a very common short-term money market investment, guaranteed by the banks. A lender funding adjustable/variable rate mortgages would typically borrow money through a 30-day Banker’s Acceptance. The lender is then responsible for paying the yield (rate of return) to the investor who purchased the BA. This yield is the cost of funding mortgages (“Cost of Funds”) to the lender.
So, what’s happening to the BA yields?
This is where the story has become interesting over the past few months.
The failure of the U.S. subprime market worried money-market investors. In Canada, investors began to sell off investments creating a strain on the market. Those who remained demanded higher yields from the BA market as no one was sure as to how much of these BA’s were used to finance U.S. subprime mortgages, or subprime mortgages here in Canada or other risky ventures. Everyone was asking the same thing: What’s the risk exposure? A classic example of the market overreacting.
The resulting increase in BA yields increased the cost of funds for lenders who want to finance their Adjustable Rate Mortgages. Essentially it’s costing lenders much more money now to finance ARMs than it did 60 days ago.
The following is a comparison of 30-day Banker’s Acceptance yields over the past 60 days:
July 17, 2007: 4.54%
August 3, 2007: 4.60%
August 14, 2007: 4.75%
August 17, 2007: 4.92%
September 11, 2007: 4.98%
September 17, 2007: 5.04%
*Source: Bank of Canada (www.bank-banque-canada.ca)
So, in 60 days we’ve seen the yield on 30 day BA increase 50 bps.
Now consider the interest rate earned by the lenders on an ARM at Prime - .90%. Today that interest rate is 5.35%. When you compare this to the current Cost of Funds at 5.04%, which doesn’t include overhead, profit margin (or any origination fees paid to mortgage originators), one can see that it’s only a matter of time before prices for ARMs need to change.
How long will this continue?
Are we seeing the end of the days of Prime - .90%? Perhaps for a while, until the money markets settle down.
The silver lining in all this is that due to Canada’s continued economic expansion and the reality of an $80+ barrel of oil, our longer term bonds are in high demand. As a result, we might see some interest rate decreases on the fixed rate products.
Wednesday, September 5, 2007
Overnight lending rate (prime)
Great news from the Bank of Canada today: No interest rate hikes.
The overnight lending rate (prime) will stay the same.
After watching the economic report this morning I feel safe to say that due to the crisis in the states, and the federal reserve in need of cuts, Canada may just follow, even though our economy is doing quite well. Time will tell. The credit crunch that is going on right now is making the Bank of Canada keep things where they are. The worse it becomes in the US makes it a better for us.
The next meeting will be October 18th.
What the Bank of Canada said this morning:
OTTAWA – The Bank of Canada today announced that it is maintaining its target for the overnight rate at 4 1/2 per cent. The operating band for the overnight rate is unchanged, and the Bank Rate remains at 4 3/4 per cent.
Near-term prospects for economic growth outside North America appear to be slightly stronger than anticipated in the July Monetary Policy Report Update (MPRU), while near-term economic prospects for the United States are weaker than expected. It now seems likely that the adjustment in the U.S. residential housing sector will be more pronounced and protracted, exacerbated by recent developments in financial markets. On balance, this implies weaker demand for Canadian exports than had been expected at the time of the July MPRU.
In Canada, total and core CPI inflation in July, at 2.2 per cent and 2.3 per cent respectively, continued to be above the inflation target but generally in line with the Bank's expectations. The Canadian dollar has also largely traded in the range assumed in the July MPRU. At the same time, the pace of economic growth in the first half of this year was above the Bank's expectations. It now appears that the Canadian economy is operating further above its production potential than was estimated in July. Domestic demand remains robust, buoyed by a continuing strong labour market and higher-than-expected increases in home sales and prices. However, recent developments in financial markets have led to some tightening of credit conditions for Canadian borrowers, which should temper growth in domestic demand.
Against this background, the Bank judges that the current level of the target for the overnight rate is appropriate. However, there are significant upside and downside risks to the outlook for inflation. On the upside, there is a possibility that household demand in Canada could be stronger than anticipated, while on the downside the ongoing adjustment in the U.S. housing sector could be more severe and spill over to the U.S. economy more broadly. In addition, there is uncertainty about the extent and duration of the tightening of credit conditions in Canada and, hence, about the tempering effect this will have on growth in domestic demand.
The Bank will continue to closely monitor evolving economic and financial developments. A full update of the Bank's outlook for growth and inflation, including risks to the projection, will be set out in the Monetary Policy Report, to be published on 18 October 2007.
Tuesday, July 24, 2007
Update
The latest rate news has the Bank of Canada looking very hard at raising the Bank rate by .25% in September, but there are many detractors who say that the incredible rise in the Canadian dollar is going to be the dampening factor on the economy, not interest rates. The longer term rates are holding steady. The news in the States has the rates staying where they are (less pressure on Bank of Canada, more pressure on our currency to rise).
Sunday, June 17, 2007
Co-Borrower or Guarantor?
What should I do?I was raised the question the other day from a great client: "What exactly is the difference between a guarantor and a co-borrower?" since many people use the term interchangeably.I replied with the answer. "Guarantors are required to sign for the mortgage, but are not on title to the property. While co-borrowers are required to sign for the mortgage AND be on title to the property. In the event of default, the lender/insurer can take immediate action against all borrowers, including co-borrowers, which is not always the case with guarantors."Just a little note. Guarantors can usually be taken off the mortgage within one year of the term. Only if there is a good re-payment history in this first year.
Tuesday, June 5, 2007
Fixed rates
I guess we couldn't be blessed for such low rates any longer! Generally speaking though, rates are still quit low.
With the increase in the Canadian Dollar, and the rise of bond rates and other factors, the fixed rates have gone up by over half a percent in the last little while. I go away for a short honeymoon to come back to higher rates! The five year posted rate is at 7.20% today. We're not too sure what's going to happen with the fixed rates, however, the way things are going today they may go up a little more. Hopefully the Canadian dollar will lose some momentum and start to come back down, which is not the prediction by CIBC world markets. They expect the dollar to be on par with the USD by the years end.
Variable rate mortgages are looking even better these days.
With the increase in the Canadian Dollar, and the rise of bond rates and other factors, the fixed rates have gone up by over half a percent in the last little while. I go away for a short honeymoon to come back to higher rates! The five year posted rate is at 7.20% today. We're not too sure what's going to happen with the fixed rates, however, the way things are going today they may go up a little more. Hopefully the Canadian dollar will lose some momentum and start to come back down, which is not the prediction by CIBC world markets. They expect the dollar to be on par with the USD by the years end.
Variable rate mortgages are looking even better these days.
Thursday, May 3, 2007
80% Conventional?!
Welcome to a new age of mortgage borrowing. All the rules have been thrown out and the new ones are being written every day, after years of the same lender attitudes that kept many people from home ownership.
The Bank Act has been amended as of April 23, 2007 to change the conventional financing ceiling from 75% to 80% of the value of the property. This means that no longer will borrowers be paying high ratio mortgage premiums provided they have either a 20% downpayment or 20% equity in the property. This will save thousands of dollars in fees that otherwise cut into a homeowners equity.
This new rule also applies to revenue property financing although lenders are a little bit slower to announce that they are willing to go the full 80%. Remember that Canadian lenders tend to run pretty conservative (read tight) when it comes to Canadians trying to make some money at Real Estate investing.
Note also the new relaxed rules regarding borrowers who are newer to Canada and who might not yet have a long career track record. With good credit the waiting time to qualify for a mortgage has been drastically reduced. It is immigration that will be driving the net growth in this part of the world and the lending community is recognizing this.
It is about time that the mortgage world became reflective of today's borrower. New Canadians, Self Employed, and people with smaller downpayments can all buy and afford a home today like never before. The mortgage lenders are rewriting the rules and the winners are the borrowers.
The Bank Act has been amended as of April 23, 2007 to change the conventional financing ceiling from 75% to 80% of the value of the property. This means that no longer will borrowers be paying high ratio mortgage premiums provided they have either a 20% downpayment or 20% equity in the property. This will save thousands of dollars in fees that otherwise cut into a homeowners equity.
This new rule also applies to revenue property financing although lenders are a little bit slower to announce that they are willing to go the full 80%. Remember that Canadian lenders tend to run pretty conservative (read tight) when it comes to Canadians trying to make some money at Real Estate investing.
Note also the new relaxed rules regarding borrowers who are newer to Canada and who might not yet have a long career track record. With good credit the waiting time to qualify for a mortgage has been drastically reduced. It is immigration that will be driving the net growth in this part of the world and the lending community is recognizing this.
It is about time that the mortgage world became reflective of today's borrower. New Canadians, Self Employed, and people with smaller downpayments can all buy and afford a home today like never before. The mortgage lenders are rewriting the rules and the winners are the borrowers.
Wednesday, March 14, 2007
US Sub-Prime Market
As this is extremely interesting news as we depend on a good US economy.
More and more people in the sub-prime market are defaulting on their payments making things extremely complex. With more and more defaults, and lenders straying away from lending to this market, there is an influx of property's on the market which is causing for drastically lower home costs. We can only wait to see what happens in the next few months. In our market up here, the Sub-Prime lenders are joining on board at a fast pace as we are still in a strong market. Hopefully we don't follow suit with our partners of the South.
More and more people in the sub-prime market are defaulting on their payments making things extremely complex. With more and more defaults, and lenders straying away from lending to this market, there is an influx of property's on the market which is causing for drastically lower home costs. We can only wait to see what happens in the next few months. In our market up here, the Sub-Prime lenders are joining on board at a fast pace as we are still in a strong market. Hopefully we don't follow suit with our partners of the South.
Friday, March 9, 2007
How much can you afford?
To answer the comment posted by 'anonymous'...
With some great new rules that have come out in the past few months, you can qualify for a minimum of 12% more of a mortgage with good credit. Longer amortizations up to 40 years, increases this number even more.
There is so much competition out there that it's creating more and more mortgage solutions for everyone. To get into a lot of detail would take too long. I can definately answer your specific questions on email or by phone, just let me know.
With some great new rules that have come out in the past few months, you can qualify for a minimum of 12% more of a mortgage with good credit. Longer amortizations up to 40 years, increases this number even more.
There is so much competition out there that it's creating more and more mortgage solutions for everyone. To get into a lot of detail would take too long. I can definately answer your specific questions on email or by phone, just let me know.
Thursday, March 8, 2007
Introduction
This is my first blog to make sure all works well.
If you need any questions regarding mortgages and so forth answered, please let me know here or by email christos@gitersos.com
If you need any questions regarding mortgages and so forth answered, please let me know here or by email christos@gitersos.com
Subscribe to:
Posts (Atom)