mortgage stress test

Looking Back at the Mortgage Stress Test

The mortgage stress test hasn’t been in effect for very long but enough time has passed for us to examine its early impact. Enacted as of January 2018, Canadians applying for a new mortgage or refinancing an existing one had to prove their financial situations could withstand an interest rate hike.

This Government initiative was designed to protect lenders from defaults and borrowers from overextending themselves. It’s fair to say that the high prices and competitiveness of the GTA and Vancouver housing markets required this level of intervention.

Impact on the National Housing Market

All of Canada’s big banks instituted the stress test so there wasn’t a way around the rules. The result was that many people had to stay with their lender and buyers had to settle for a less expensive home.

There was an impact on inventory as fewer properties were put up for sale. This led to a seller’s market and higher average prices. For those who were looking to refinance, they most likely had to settle for a lower loan amount.

None of this is particularly bad. It was simply a shift in lending, which led to people being more cautious.

Best Chance at Passing

To pass a mortgage stress test, you should max out your down payment. This means getting as close to 20% as possible if not more. Also, if you feel as if a promotion or better paying job is around the corner, then it’s not a bad idea to wait until your household income is higher.

These rules roughly breakdown as $600 for $100,000 you borrow to purchase a home. If you think you can afford this then you are in good shape to get pre-approved. This is something to discuss with your lender as they can guide you through the entire process.

Talk to a Broker Today

Contact us to discuss your financial situation and to start the pre-approval process. We would be happy to answer your questions and give you a clear picture of what your future as a homeowner could look like.

saving for down payment

Where to Invest your Money if Saving for a Down Payment

A down payment is typically between 10-20% of the purchase price. Of course, the more you can pay upfront the better, but most buyers in the GTA aim for at least 10%. To reach your down payment goal quickly, here are some options with respect to investing your money.

Remember, this is for people who are comfortable with investing, have the knowledge to successfully navigate the world, or have someone they trust—like a broker—to guide them. It is not recommended to ever risk your money to grow it.

Where can you invest your money to build a down payment to get the mortgage you want?

High-Interest Savings Account

A high-interest savings account from any of the popular institutions is one of the better and more common places for people to grow their down payment. Granted, it stretches the definition of the word, “investment”, but your money can grow and be secure.

Most banks allow you to set up automatic deposits, making savings easier.

Guaranteed Investment Certificate (GIC)

A GIC offers a guaranteed safe return so there is no risk involved. You know the return will be limited but if you are only looking to raise the last little bit of your down payment then a GIC could make sense.

There’s another downside besides the low return. If you pull your money too early you could be forced to pay a fine.


This is the one that first-time homebuyers should consider.

RRSPs is usually viewed as part of a retirement savings plan. While your money won’t necessarily grow, it can help you in other ways. Canadian residents who are buying a property for the first time can take advantage of the Home Buyers’ Plan, which allows you to withdraw up to $25,000 from a RRSP tax-free. If there are two people who are buying the home, then each can use the plan to withdraw up to $50,000.

Remember, you must repay the withdrawn amount within 15 years.

Saving is never easy. Even if the property is fairly prices, a down payment will be a lot of money. You need to be prudent and save diligently.

Contact us to discuss your down payment or to start the pre-approval process.


The Technological Disruption to Real Estate

From listing apps to contract platforms, technology has changed the face of real estate and will continue to evolve every aspect of how people buy and sell properties. Technology streamlines a complicated process and every real estate agent and lender should be taking advantage.

Let’s review some of the most exciting web and mobile applications that buyers and sellers should consider adopting to maximize efficiency, drive the value of their property or to even help them negotiate a sale.


This app has over 200 million users and allows users to sign documents from any device. It has replaced cumbersome old methods like faxing and doesn’t require a courier or postal office. It’s secure and easy to use and automatically sends fully executed documents to all parties.

Your realtor should be using DocuSign to secure your signature on key documents. It will speed up the purchase process.

Magic Plan 

This app is a bit more niche but it allows people to turn photos into floorplans by marking the corners. Once you have a floorplan, you can edit and decorate and start to see how you can make the property more valuable or how you can add your own personal touches.

The app creates 3D views and users can export their floorplans. This is a great tool for real estate agents to use with their clients.

Canadian Mortgage App

The Canadian Mortgage app is a well-built and simple mortgage calculator that uses industry qualifies and the 2018 stress test. Its algorithm includes land transfer taxes and rebates. We recommend speaking with a lender to get pre-approved as no app can replace the opportunity to ask your questions to an expert in the mortgage field.

For those looking to learn more about mortgages or to get an idea of what they can afford, this app is useful.


BiggerPockets is an online resource that educates people on everything real estate. Users can find out about specific markets and gain access to analytical tools. You can also get connected to agents and vendors.

This is an educational website for people who want to learn more and have the comfort of knowing what they are getting into.

Get Pre-Approved Today! 

Online resources and apps are useful but they work best when you partner with an agent and lender. Contact us today to start the pre-approval process and we would be happy to answer all your questions.

condo market

Toronto’s Impending Rental Hike

Toronto is a metropolis but living in the GTA can be challenging. Because of the mortgage stress test that was implemented several years ago and the overall cost of property, many have been unable to enter the housing market. This has led to a hyper-competitive rental market with no end in sight.

As if rental prices aren’t high enough, this year might see an 11% hike. This is bad news for young professionals in Canada’s most expensive city.

Reasons for this Hike

The lack of inventory is the biggest culprit. Supply is driving demand, allowing landlords and property owners to charge renters more. This lack of inventory is the result of people staying put because they don’t want to be susceptible to higher rent. The difference in one’s current rent compared to moving to a new place could be hundreds of dollars.

There is an incentive for people to stay where they are even if they want to upgrade or move to a more desirable neighbourhood.

The Impact on Renters

Per a panel of housing experts, the average annual rent for a typical apartment or condo in Downtown Toronto will increase, making moving or living in Core Toronto very difficult those with a relatively normal income.

The new average cost of renting will make moving in the foreseeable future impossible for some as a person will need to pay for first and last month’s rent in addition to being able to carry the home monthly.

Toronto will experience a more significant increase than other major Canadian cities like Ottawa and Vancouver.

It’s Time to Consider a Mortgage

Most want to buy a property but feel that they can’t afford it. Buying a home costs more but the difference between a mortgage and rent could be negligible, or a mortgage could conceivably cost less per month.

If you don’t have enough money to cover a 20% down payment or the other fees, then make 2019 a year of saving. Put off upgrading your rental home and make other sacrifices so that getting approved for a mortgage can be a reality in 2020.

If you want to learn more about mortgage approval or start planning, then contact us today!


Should Millennials Look to Buy in 2019?

Over the last number of years, Toronto has become one of the fastest growing cities with respect to real estate prices. This has hurt millennials who feel shut out from the dream of homeownership.

Affordability is a significant and widespread issue and one that has also extended to the rental market. The rental market has become just as competitive and pricey as ownership. And why should landlords get your money without any real benefit to you?

Let’s look at some reasons why millennials should consider entering the real estate market in 2019.

Choose a Neighbourhood that Makes Sense

While it may seem more affordable in the short term, millennials who are not already in the market would be wise to make 2019 the year they jump in.

You may feel priced out of the midtown area and the downtown core, but there are various spots across Toronto to explore. Maple, Markham, Scarborough, the Junction, the Danforth, are all expanding and changing in housing and demographics. Public transit options are also changing accordingly with the subway expansion, light rail growth, and various Go train locations.

The GTA is becoming more accessible and well connected so maybe it’s time to expand your search beyond Little Italy.

Short Term vs. Long Term Payoffs

Ultimately, affording a down payment on a mortgage can be daunting, but monthly mortgage payments can potentially be lower than rent prices. In the long run, you are also paying towards owning and building equity and credit, while the value of your home is likely appreciating.

Buying a home is like investing your money in a term deposit that doubles as a place to live. You have complete control over renovating, downgrading or upgrading.

A Great Investment Option

Although there may be some risk involved, such as a real estate crash, the market is always cyclical and, therefore, you can wait until prices go back up to make a profit by selling. And while home ownership may come with some headaches, there is also satisfaction and payout in having the security and stability of your own living quarters, not to mention not that you can’t be “kicked out” by a landlord who wants the place back.

Contact us today to take the first step towards becoming a homeowner!


Oppono’s Service Commitment

With so many options available today, it can be difficult to know where to turn and from whom to seek good advice. Our service commitment was designed to make this decision easier for people looking to get approved for a mortgage or home equity line of credit.

Oppono offers borrowers many advantages, including experience, expertise and the ability to get people approved to buy their dream home.

Quick Turnaround

Oppono responds to inquiries and applications within three hours, letting people know if partnering with us makes sense. Our team also contacts you directly about your request for a mortgage to help answer any questions. We also aim to address any issues that may have arisen during your application process.

Our clients depend on us for this reason, as well as trust in our advice and assistance.

Dedicated Team

Since we strive to contact our customers and prospects within a short window of time, we are committed to hiring dedicated professionals who go beyond the typical workday. We aim to help you move forward with your mortgage application as efficiently as possible.

Our team is made up of business development managers who offer sound, helpful advice. Further, we have skilled underwriters who are reachable when you have further questions.


We pride ourselves on following up with customers and prospects like you as part of our excellent service and commitment. Oppono is a unique financial lender and mortgage provider in this way, because we care about delivering quality across the board. You can feel confident and at ease that you are in good hands—because we truly care about maintaining the solid reputation we have earned and continue to build.


Our team works hard to ensure you are always satisfied and content. We help you overcome any issues or challenges you might be experiencing to make the mortgage application and loan process smoother and simpler. As a result, we look forward to hearing any and all feedback you may have for us so we can continue to improve all the time.

Feel free to reach out and divulge any positive experiences or suggestions, so we can respond accordingly.




An Update on Quayside

The proposed development known as Quayside—located near the Queen’s Quay in eastern downtown Toronto—will likely feature 12 buildings made up of residential, retail and commercial units.

Part of the Google family, Sidewalk Labs is behind the future community that intends to revolutionize urban living through intelligent technology. Certainly, this new development will put pressure on other builders to respond to changing demands the next generation of homeowners and professionals.

Growth for Jobs and Opportunities

Though approximately five years out, the plans are to utilize light rail transit bridges and walking trails. It is also expected to create 9,000 construction jobs while the community is being built, and approximately 4,000 more jobs throughout the area because of it. The company also wants much of its residential space, fit for roughly 5,000 people, to be more affordable than the current Toronto real estate market.

Environmental Boosts

There is a large commercial aspect to Quayside. Sidewalk Labs wants to appeal to both new and established businesses who can offer residents a variety of services while fitting into the ideology of the development.

The company wants to focus on the positive environmental implications of having solar panels on the roofs and geothermal wells to reduce carbon emissions up to 85 percent. It strives to reduce energy by 20 percent using an artificial intelligence building management system.

Mysterious Funding

Sidewalk Labs is currently looking for partners to move the project along; however, it has been somewhat secretive about how much more funding it requires to come to fruition.

While Sidewalk Labs and Toronto could co-fund the project, it would be a massive investment and every dollar would need to be accounted for and Sidewalk labs would need to make all expenditures public. That is the crux of leveraging tax dollars.

If Sidewalk labs decides to solely fund the development, they would require construction and management partners, neither of which would be cheap.

Unknown Completion Date

These new or confirmed details aside, the project has many unknowns factors, such as when construction will begin, who will help sell the units, and what Torontonians can expect the finished product to look like. Most developers underestimate timeframes, too, so it is unclear when this exciting venture will realistically be ready. Interested parties can anticipate something new and different, though.


Is your Mortgage up for Renewal in 2019?

Making your monthly mortgage payments can be stressful enough, but when it comes time to renew your mortgage, choosing between all the different options may just put you over the edge.

But since home ownership comes with its own set of complications and responsibilities, here are some factors to consider when you renew your mortgage that will help simplify the process.

Review the Current Market

When it comes time to renew your mortgage, it is important to ensure you review the current market. Most likely, there have been quite a few changes since you decided on the type of and the timeframe for your mortgage.

Choosing between variable and fixed rates is never foolproof, but seeking the advice of a professional and conducting your own research can improve your understanding.

Weigh your Options

By choosing a fixed rate, you have the security of knowing how much you will owe for the length of the mortgage. The current market is considerably friendly for borrowers, which makes it even more confusing to know which option to pursue. However, if the rates in the market decrease, you will have to face the fact that you are paying more than necessary.

With a variable mortgage, you take a gamble in hopes that the current rate will either remain the same (if it is already low) or dip, thus benefiting you over the next few years. If it does, you obviously reap the rewards. If the interest rate goes up, you will end up paying more than if you had chosen the fixed rate.

As you decide whether to renew or not, you need to weigh not only your options but your appetite for risk.

Explore Non-traditional Lenders

Beware of big banks that may just try to sell you what is more profitable for them. A non-traditional lender like Oppono can offer expert advice without the hidden fees. You will also receive more personalized customer service. Additionally, you can receive the advice of a professional with specialized expertise who studies the rates and can better predict what the market is going to do.

Contact us today!



Another Benchmark Rate Hike by The Bank of Canada

In October, the Bank of Canada raised the benchmark interest rate by 1.75%. That’s the fifth time that the rate has been increased a quarter point in a few months.  It has reached the highest it has been in a decade, which is spelling some trouble for Canadian borrowers.

To understand what this means for the housing market, you need to understand what a benchmark rate is, how it is determined and what homeowners should expect going forward.

What is a Benchmark Rate?

The benchmark rate determines the minimum that the big banks in Canada charge each other for short-term loans. Even though it is a rate that dictates the relationship between financial institutions, it does trickle down to customers. Most banks use the benchmark rate to calculate the variable mortgage rate and the rate for savings accounts.

The Recent History of the Benchmark Rate

Borrowers had a few years to enjoy a stable rate as the Bank of Canada kept the benchmark at record lows to spur the economy after the market downturn in 2008.  Now that the economy is healthier, the rate naturally must increase. Borrowers will continue to experience the impact but overall the rate is at a relatively safe level considering the Bank of Canada’s recent activity.

The Impact on Borrowers

Borrowers are already feeling the pinch. Because of the benchmark rate increase, Royal Bank, BMO, CIBC and TD all raised their prime lending rates to 3.95%. The remaining banks like Scotiabank should be raising their rate before the year is over.

It is now more expensive for Canadians to borrow, which isn’t a positive for most people. The silver lining, though, is that fewer people being overextending on a loan or loans can result in less household debt.

Like anything related to the Bank of Canada, things change fast. Canadians have gotten use to benchmark rate increases over the last few months but that trend might not extend into 2019.  For now, Canadians should continue to borrow for the right reasons—buying property, education or business opportunities—but staying a bit cautious can’t hurt in the long run.


Why are First-time Homebuyers Maxing out a Budget?

The landscape has changed for first-time homebuyers in the GTA. According to a report by the CMHC, 85% of people entering the housing market for the first time are using their entire budget in order to make the purchase. This means they paying the highest down payment in addition to mortgage insurance and closing fees. This isn’t unique but it is surprising.

There is a lot for buyer, sellers and lenders to consider with respect to what this means to the GTA housing market and if new homeowners are in for a rude awakening.

The Potential Housing Market Fallout

This is based on an ongoing survey, first conducted by the federal housing agency in 1999, to gauge market affordability for buyers, both new and repeat. Despite slightly weakening markets, people are still being forced to put all their assets toward a home purchase.

One interesting takeaway is that 76% of people claim to still be confident about their ability to carry their mortgage. For many, this might be true but it does put those with a variable rate at risk if there’s even a small increase.

Homeowners also need to consider what will happen if their personal financial situation changes. By maxing out on budget, a person is operating without the safety net of savings and could be in trouble if something suddenly happens. For instance, if they lose their job, have a medical emergency or must pay for a post-secondary education, their property could be in financial jeopardy.

Looking to the Market for Answers 

Something of this nature doesn’t happen in a vacuum. The market has become so competitive that people are forced to pay everything upfront and worry about the details later. While some earn enough that carrying a mortgage with no savings isn’t a concern, it’s still not a great sign for the market.

Affordability is still an issue plaguing the GTA. Affordability is ensuring that people can pay for a down payment, their closing costs, moving expenses, furnishings and have a bit of savings left for renovations, improvements or in case of emergency.

We know that buying a home for the first time is stressful. Contact us to understand what your budget should be and whether you need to max out in order to close.