As many of you are aware, CMHC announced 3 pending changes today:
1. The qualifying rate to be used for variable rate mortgages, or terms shorter than 5 years will be a standard benchmark rate published by the Bank of Canada. In essence this is the 5 year posted rate.
2. TDS calculation for rental income has been changed to only include 50% of the gross rental income which is added back to income rather than offset.
3. CMHC’s self employed program will no longer be eligible for borrowers with more than 3 years in the same business. Instead they will need to rely on more traditional third party income proof.
These two links below will allow you to view 2 letters from CMHC.
The provincial association for mortgage brokers, AMBA, is concerned with these changes. AMBA is working with the other provincial associations on a concerted effort to communicate our concerns with both CMHC directly and the Finance Department.
QUALIFYING INTEREST RATE LETTER FROM CMHC
NEW QUALIFYING PARAMETERS LETTER FROM CMHC
Keeping you abreast of the major impacts and qualifications for mortgage approval,
James C. Tworek and the Trimor team!
www.trimormoney.com
[ add comment ] ( 7 views ) | permalink |
( 0 / 0 )
On behalf of our Board of Directors and Advisors, Trimor Mortgage Investment Corporation is pleased to report fourth quarter 2009 operating results for the period October 1, 2009 to December 31, 2009.
For the fourth quarter of 2009, TMIC realized a return of 8.00% to its shareholders – finalizing our 2009 annualized rate of return at 8.03%. Shareholder equity decreased slightly to $15,807,000.
TMIC continues to deliver positive returns despite another year of global financial turmoil. TMIC management continues to invest on a conservative basis and as always, we will remain focused on capital preservation while enhancing returns to investors.
Included with this report is a portfolio summary of your account(s) showing the number of shares that you own in TMIC and the dates that they were acquired.
The fourth quarter yield was paid to all investors in the form of a dividend on December 31, 2009. If you chose a cash dividend, the dividend has already been deposited directly into your bank account or has been forwarded to your trust company for registered accounts. If you chose the dividend reinvestment plan (‘DRIP’), additional shares in TMIC will be credited to your account effective December 31, 2009.
As of December 31, 2009, TMIC’s mortgage portfolio consisted of 31 mortgage loans; 27 of the mortgages are on residential property and 4 mortgages are on commercial buildings and construction projects. The mortgages have maturity dates ranging from February 1, 2010 to January 1, 2011. All loans are secured by real property in the province of Alberta and BC.
Management is pleased to report that we have sold all of the properties that were in the foreclosure process last year except 1 that is currently MLS listed. (This property was left abandoned halfway through a renovation and we have now completed all repairs). All recovered funds are back working in TMIC.
The current real estate market conditions are improving and we anticipate selling the remaining property during the next quarter.
As reported last quarter, management did commence foreclosure proceedings on 2 new delinquent mortgages. We now own one of the properties and are preparing it for sale, the second property has a pending sale that should clear up all arrears.
TMIC continues to weather the turbulent credit and volatile equity markets with minimal effect on operations or return to investors. We do not expect any significant negative effects to TMIC in the foreseeable future as we have turned over the majority of our mortgage portfolio in 2009.
During 2009 we recognized $392,400.00 for potential losses from unearned interest, legal and realtor fees for the foreclosure mortgages. Returns received by investors over 2009 have included the reserve expense, still maintaining our 8% target. Moving forward we are currently working on a potential provision for bad debt, and at this point estimate that we will carry forward and expense a further loss in the region of $150,000.00 to $250,000.00.
Any interest and expenses recovered upon sale of these assets will go back to the investors in the form of an increased return.
The monthly (December) statistics have just been released by the Calgary Real Estate Board. Statistics released show the Calgary housing market continues to show signs of a sustained recovery. The number of homes sold in December 2009 was up 78% over the same month last year. Sales continue to show a return to a balanced market. A price decrease of 3% was seen when compared to November of 2009, however the price did show a year to year gain of over 8%. The absorption rate (inventory turnover) continues to increase with the inventory turnover for single family homes and condos in Calgary being just over two months.
Consider this…….The Power of Compound Interest
…In our fourth quarter report of 2008, comparisons were made between the TSX equity Index and your TMIC investment. The comparison showed a $1000 investment made on the TSX in January of 2008 would have dropped in value by year end to $645, while a similar investment in TMIC would show an increase in value to $1104 by January of 2009. Your TMIC investment would have been 71% higher than the TSX investment. By continuing the comparative trend thru to January 2010, your TMIC investment still shows a 28% premium over the TSX investment, even after the TSX posted a 33% gain during the year. The same $1000 TMIC deposit would now have a value of $1192, the TSX investment would come in at $857, still 15% less than the original principle amount invested 2 years ago. Even if the TSX posts an additional 20% gain during 2010, your original $1000 investment will just break even after 3 years, yet at the same time TMIC will have posted a 29% gain ($1,287, assuming an 8% yield).
As mentioned last quarter, our new Controller, Jean Aitken, is now in the process of reviewing all accounting procedures at TMIC to better service our investors. Commencing March 31st, our commitment to you, is to complete all quarter end financial reporting and distribution of dividends no later than the 15th day following the end of each quarter. If the 15th day happens to fall on a weekend or holiday the deposit will be made on the following business day. This will ensure timely reporting and deposit to accounts for clients with direct deposit.
Kenway Mack Slusarchuk Stewart, Chartered Accountants have been engaged to prepare our annual Year-End Audited Financial Statements. The final report will be delivered with the Q2/10 Directors Report, due for circulation April 15th, 2010.
As always we would be pleased if you would consider TMIC for your 2009/2010 RRSP, RESP, Tax Free Savings Account (TFSA) and cash account contributions. If you know of someone who would be interested in a TMIC investment, please have them contact either one of the contacts listed below. Your trust and referral is our greatest asset.
TMIC operates as a Mortgage Investment Corporation pursuant to the Income Tax Act (Canada). TMIC provides mortgage loans to owners and developers of single and multifamily residential properties as well as commercial, office and industrial properties.
All funds lent out by TMIC are secured by way of first and second mortgages on the real property being financed. All profits of the fund are distributed to the shareholders as dividends on a quarterly basis. Shareholders may elect to receive dividends in cash or they can reinvest them back into the fund.
Get your money working for you!
Contact Jim(at)trimormoney.com for further details and education on how
the TMIC fund can help you meet your investment goals!
[ 1 comment ] ( 19 views ) | permalink | related link |
( 3 / 25 )For a full copy of the February 2010 RECA regulator, click HERE for the flash version and HERE for the print-friendly version.
RECA Launches Mortgage REP Course Online
The Real Estate Council of Alberta is pleased to announce the launch of the Mortgage Broker Update 2009-2010 course. This is the Re-licensing Education Program (REP) course mortgage brokerage industry members are required to complete before renewing their registration in
September 2010.
The course can be taken on an ‘any time, any place, any pace’ basis. Course completion time will vary based on the individual. Industry members are able to complete the course in segments, as the course is built to remember where an industry member left off and return him
or her to that location in the course upon logging in again.
Mortgage Broker Update 2009-2010 was developed to enhance industry members’understanding of the Real Estate Act, Rules and Regulations; create awareness of current industry issues; and, review relationship options and disclosure requirements with borrowers and lenders.
The online course is available at no cost through the RECA website at www.reca.ca. Simply click on RECA Education, then the Mortgage Broker Update 2009-2010 course link, and begin the enrollment process. As with all RECA Education online courses, industry members require their RECA ID number, which they are to obtain from their brokers.
Helping us all stay up to date with the ongoing changes in the Alberta Mortgage Marketplace,
James C. Tworek and the Trimor team!
www.trimormoney.com
[ add comment ] ( 8 views ) | permalink |
( 3 / 25 )This month's version of the RECA Regulator trade publication is now available!
Some of this month's highlights:
Expedited Investigation Process
Information Bulletin: Referrals – Industry Member Requirements
RECA Launches Mortgage REP Course Online
Annual Report Available
Real Estate Trust Account Requirements Amended
Communicating Through Social Media
RECA Announces New Director of Industry Standards…
…plus all of the regular features found in the Regulator,
including Education and Legal Corners, Licence Suspensions and Case Summaries.
For the higher-tech flash version, click HERE
For the print-friendly .pdf version, click HERE
Keeping you abreast of the changes in our industry!
To your education and growth,
James C. Tworek and the Trimor team!
www.trimormoney.com
[ add comment ] ( 8 views ) | permalink |
( 3 / 25 )The February 2010 edition of CMHC's Monthly Housing Statistics is now available and can be accessed by clicking HERE.
The statistics firmly reinforce the many news articles in previous weeks across Canada about low borrowing rates and housing starts coast to coast. Current MLS absorption rates are quite high and average sales values are rebalancing themselves after a difficult 2008-2009 in many municipalities across the board as well. Looks like we're off on a good foot for 2010 so far!
It always pays to be informed! For more CMHC housing market information or to find a Housing Market Outlook conference near you, visit their site at: http://www.cmhc.ca/housingmarketinformation.
Helping you make sense of the Canadian housing market and understand the facts behind the news media,
the Trimor team!
www.trimormoney.com
[ add comment ] ( 11 views ) | permalink |
( 3 / 25 )
