With everything that is going on in the lending markets recently, many people are starting to panic. Well don’t head for the hills quite yet because help is on the way and a Federal Program and plan has been put into action.
It was recently announced that Canada Mortgage and Housing Corp. which is a government run agency, will purchase $25 billion in mortgages to help ease high costs of borrowing. The plan will benefit banks and mortgage holders as it will “make loans and mortgages more available and more affordable for ordinary Canadians” said Finance Minister Jim Flaherty. The lenders will get cash given to them from Canada Mortgage and Housing Corp. giving the banks more money to lend to consumers.
Although the costs of borrowing are still high, it will take some time. With a new plan of action in place, banks are anticipating a decrease in mortgage rates. The start of the decline in rates has already been reflected in the recent drop of prime to 4.25%. Banks are working on lending to customers at reasonable and affordable rates while still maintaining some safety. This plan is “a market transaction to ensure our credit markets are functioning strongly” said Prime Minister Stephen Harper. It will not happen overnight, but we are getting ourselves back in shape so no need to panic quite yet.
For more information on the Okanagan Real Estate market contact: info@theOREC.com