A soft landing for Canada is becoming a “distant prospect”

General Beata Wojtalik 14 Sep

A soft landing for Canada is becoming a “distant prospect”

The likelihood of the Bank of Canada’s desired “Goldilocks” outcome of a soft landing for Canada’s economy is growing dimmer, according to a new report from RBC.

The report is based on recent research from BIS, which suggest “front-loaded” tightening cycles, such as the one being undertaken by the BoC, “tend to be followed more frequently by soft landings.”

But that may not hold true this time, RBC argues.

“With policymakers pledging to do what it takes to rein in inflation, we think a soft landing is becoming a distant prospect,” RBC’s economists wrote. “Central banks are aware of the challenge, but only the BoE has been bold enough to forecast a recession.”

RBC currently expects Canada, the U.S. and the UK to see economic contractions beginning later this year or early next year.

“These declines, while unpleasant, are arguably needed to return supply and demand to better balance and ease inflationary pressure,” they added.

The BIS bulletin, entitled “Hard or soft landing,” explores the difficult job central banks have when it comes to controlling inflation while not sacrificing economic activity, at least no more than necessary.

“The policy response to the current rise in inflation involves difficult trade-offs, and the path to a soft landing is narrow,” the report reads. “Tightening too much or too quickly could result in financial stress and a hard landing, inflicting unnecessary damage to the economy. But, tightening too slowly could let inflationary pressures become ingrained, requiring more forceful and costly action down the road.”

RBC adds that the “potential consequences of not acting quickly enough to contain price growth—and possibly, losing all influence over longer-run consumer and business inflation expectations—outweigh the risks of hiking interest rates too much.”

The bank currently expects the BoC to bring the overnight rate to 4% by the end of the year, up from its current level of 3.25%.

“Interest rate cuts could come as soon as the second half of next year if a recession follows as we expect,” the RBC economists noted. “But by the same token, risk remains that interest rates could rise further if inflation pressures don’t show clear signs of deceleration in coming months.”

The coming downturn is expected to be moderate

RBC continues to expect the coming downturn to remain moderate “by historical standards,” according to its current forecast.

The bank expects the unemployment rate to rise 1.7 percentage points from trough to peak over the next year and a half, which would be “relatively mild” compared to previous downturns, it notes.

Can You Get A House Loan Without A Job?

General Beata Wojtalik 8 Sep

Can You Get A House Loan Without A Job?

Yes, absolutely: Many individuals such as retirees, divorced parties, and those with significant investments in the bank receive one every day. In fact, it’s eminently possible to get a mortgage without a job, so long as lenders are able to determine that you can, in fact, repay the loan. In effect, so long as you’re able to provide a prospective home mortgage lender with proof that you’re able to meet your monthly mortgage obligations in regular and timely fashion, you should be able to get a house loan.


How To Get A Mortgage Without A Job:


  • You Have Other Reliable Income


  • You Have Significant Cash Reserves


  • Have Someone Co-Sign


Types Of Home Loans For Those Who Are Unemployed:


Of course, there are also specialized home loan types available for individuals who are unemployed as well. 

  • Asset Depletion Mortgage
  • No Income Verification Mortgage

Do you want more information? Message me or Schedule your call today:- CALENDAR LINK


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What Is Considered Debt When Applying For A Mortgage?

General Beata Wojtalik 2 Sep

What Is Considered Debt When Applying For A Mortgage?

When you apply for a mortgage, your lender will pull your three credit reports, one each from the national credit bureaus of Experian™, Equifax® and TransUnion®. These reports will list your outstanding loan and credit card balances.


The debts listed on these reports are the ones that your lender will consider when determining whether you can afford to repay a mortgage. Your lender will consider these debts when calculating, too, how big of a mortgage loan, and how large of a monthly payment, you can comfortably afford.


Mortgage Payments


Your mortgage payments – whether for a primary mortgage or a home equity loan or other kind of second mortgage – typically rank as the biggest monthly debts for most people. If you are applying for a new loan, your mortgage lender will include your estimated monthly mortgage payment in its calculation of your monthly debts.


Loan Payments


Mortgage lenders also consider any other recurring loan payment as part of your monthly debt. This includes the payments you make each month on auto loans, student loans, home equity loans and personal loans.


Credit Card Payments


Lenders look at your credit card debt, too. They will use the total minimum required payments that you must make each month on your credit cards to determine your monthly credit card debt.


Alimony And Child Support Payments


If you are divorced, you might make monthly alimony or child support payments. Lenders also consider these payments as part of your monthly debt because you must make them each month, even after you add a mortgage loan payment to your expenses.


Ready to move ahead into the next stage of the purchase process? Message me or Schedule your call today:- CALENDAR LINK


#mortgage2022 #mortgageloans #mortgagebroker #mortgagerates #mortgagelender #CANMortgage #Mortgage #MortgageLender #FirstTimeHomeBuyer #homeloan #homefinance #Refinance #mortgagetips #RefinanceMortgage #realestate #mortgagetips #loanmortgage #financehome #emortgage #MortgageNote