Tips for Reducing Sugar

It’s hardly breaking news that sugar isn’t healthy. You don’t need to eat zero sugar to be healthy. However, the reality is that most people eat too much sugar. I’m all about being practical. And, enjoying what you eat. So today, I’m sharing with you my favourite tips for reducing sugar intake.   

Before I jump in to the tips, I want to clarify a few things. First, today I’m talking about added sugar. I’m not talking about the natural sugar in foods like fruit and dairy. Second, I’m talking about all added sugars – white sugar, brown sugar, raw sugar, maple syrup, honey, agave, coconut sugar, high fructose corn syrup, etc.

While there are some differences amongst these regarding their healthfulness, they all contribute calories without adequate nutrients. They also all create a spike in blood sugar that isn’t healthy for our bodies. I’m not using this post to debate which one is the best added sugar.

This post is about practical ways to reduce your overall intake of added sugars.

Another thing that I want to bring up before I share my tips for reducing sugar, is our bodies’ amazing ability to adapt. Including our taste buds. Taste buds are influenced by what we eat. If you eat a lot of sugar, then a highly sweet taste will become your ‘normal’. This gets in the way of enjoying foods that have a less-sweet flavour profile, such as vegetables, whole grains, beans/lentils and plain water.

The key strategy behind most of my tips is to take control over how much sugar you’re eating. Then, gradually decrease the amount of sugar that you add. As you do so, your taste buds will adjust. Eventually, unsweetened foods will taste good to you and you’ll enjoy eating them.

Also read: Healthcare plans; Reasonable and Customary Charges

You will notice that none of my lower-sugar tips involves switching to artificial sweeteners. I don’t take stock in the fear tactics that many people spread about them. However, I’m still not a fan for two reasons:

  1. They allow the continuance of having a highly sweet taste being your norm. Thus, they interfere with enjoying healthy foods that don’t naturally have a sweet flavour profile, such as plain water and vegetables.
  2. History has taught us that foods closest to the way Nature made them are our healthiest choices. Vegetables, fruits, nuts, seeds, pulses, and real whole grains; these foods, eaten close to their natural state, are the foundation of a healthy diet. Moving from added sugar to artificial sugar is moving further away from Mother Nature. What I recommend is to take steps to move towards foods in their natural state.  

Reducing Sugar Tip #1:

Switch from pop to flavoured sparkling water. Did you know that a can of pop has approximately 10 teaspoons of sugar in it?  Sports drinks and energy drinks have about the same.

If you’re a pop drinker, this is where I recommend starting because it’ll be the biggest bang for your buck. Many people I’ve met who are regular pop drinkers tell me that they find water disgusting. Water isn’t disgusting. It’s neutral. These folks are experiencing a super sweet taste bud calibration. Adding a splash of citrus or fruits or herbs to plain or sparkling water is a great way to get flavour without all that sugar.

Companies are seeing that there is customer demand for flavourful, no added sugar drink options and there are now many flavoured (sugar- and artificial sweetener-free) sparkling waters. The big soda companies make them. As do many smaller companies. It’s a trend that I’m loving.

Reducing Sugar Tip #2:

Fruit flavoured yoghurt may have a touch of fruit, but it’s mostly sugar in there. If you find plain yoghurt too sour, buy plain yoghurt and add your own jam, honey, or maple syrup. Slowly decrease the amount of jam/honey/maple syrup that you add until you’ve gotten accustomed to plain yoghurt. Also, it’s worth trying different brands of plain yoghurt. Some are sourer than others.

Reducing Sugar Tip #3:

Many healthy-seeming cereals contain quite a lot of sugar. Read the labels of your favourite brands and chose the one that has the least amount of sugar. Mix your favourite cereal with one that has zero (or almost zero) added sugar. Slowly alter the ratio until you’re eating a full bowl of the zero sugar cereal.

The same technique works with instant oatmeal. Buy one box of plain and one box of flavoured. Mix one packet of plain with your packet of flavoured oatmeal. Even better, make your own hot oatmeal or overnight oats. Add as much honey/ maple syrup brown sugar as you need. Then slowly cut back on it until you enjoy your oats with just fruit.

Reducing Sugar Tip #4:

I recently learned that Canadians have the highest consumption rate of food bars. Read closely the labels on granola and energy bars. All of them have some sugar. But the amount of sugar can really skyrocket. The sugar content can be highly variable amongst the different flavours by the same brand. So reading labels is the only way to spot lower and higher sugar choices.

Again, be practical. If you don’t like the lowest sugar bars, switch to a bar that you do like that has less sugar than your usual choice. Once your taste buds become accustomed to your new bar, stitch to a bar with even lower sugar. Homemade power spheres can be a great choice because you can control how much added sweetener you use in the recipe.

I hope these tips help you to start reducing your sugar intake today!

Health Care Plans: Reasonable and Customary Charges

medical insurance coverage benefits

Have you ever wondered what your Extended Health Care plan actually covers?

Typically, Extended Health Care plans include coverage for the services of several types of healthcare practitioners, such as chiropractors and massage therapists.

There is a range of usual fees practitioners in each province charge for services.

Insurance companies use these “reasonable and customary” fees as the basis for pricing their benefit plans and determining the maximum eligible amount that they will reimburse. Most provider associations publish a suggested fee schedule for their practitioners.  

However, there is no requirement for them to charge according to this and fees for similar services can sometimes differ substantially from one practitioner to another.

Most paramedical expenses claimed by plan members fall within the reasonable and customary fee range. If a healthcare practitioner chooses to charge more, the member is responsible for the extra cost. Does this make the current system outdated?

Below, are the reasonable and customary charges for each type of practitioner in British Columbia, Canada (note: Some carriers do not publish their listing as they believe it helps protect the plan member, as some service providers will then charge the maximum allowable rate, as well as limit any fraudulent or excessive service fees.)

Your plan may not cover all the practitioners listed below, so make sure to check your contract or contact your group benefits representative if you are unsure.

Practitioners’ reasonable and customary charges:

  • Acupuncturist (For Initial assessment and Subsequent visit) – $100
  • Audiologist (per hour) – $125 
  • Chiropodist or Podiatrist – (For Initial assessment and Subsequent visit) – $100
  • Chiropractor – Initial assessment $135; Subsequent visit $60 
  • Dietician (per hour) – $150 
  • Massage Therapist (per hour) – $100
  • Naturopath – Initial assessment $210;  Subsequent visit $155 
  • Occupational Therapist (per hour) – $140
  • Optometrist (For Initial assessment and Subsequent visit) – $120 
  • Ophthalmologist (For Initial assessment and Subsequent visit) – $200
  • Osteopath – (For Initial assessment and Subsequent visit) – $120
  • Physiotherapist – Initial assessment $80;  Subsequent visit $135
  • Psychologist (per hour) – $190
  • Social Worker (per hour) – $175
  • Speech Therapist (per hour) – $120

This list only reflects the maximum Reasonable and Customary amount allowed per treatment. Claims will still be subject to the terms of your policy.

Also read: Tips For Reducing Sugar

Usually, a plan limits paramedical services to one treatment, per service, per person, per day. It is the plan member’s responsibility to ensure their paramedical providers possess the credentials accepted by their insurance carrier.

We hope this guide helps you to better understand your Extended Health Care Plan.

If you’re an employer perhaps it will encourage you to review your plan, and whether change could potentially be beneficial for your employees Extended Health Care Plan.

The Value Of Employee Benefits

employee benefits by ly siu consulting

Why Should You Consider Offering Benefits To Your Employees?

As a small business owner, you understand how important your employees are to you. The company wouldn’t be where it is without them. Simply put, employees can make or break the company.

Besides wanting to treat your employees well and making sure they have everything they need to do the best job they can, you want them in good health. Employee benefits are the only way you will be able to ensure and enforce that your employees maintain the best of health.

This can be even more critical if your employees are operating machinery and vehicles or performing any task that could potentially put themselves or others at risk.

Employee benefits plans have numerous advantages:

  • Attract and retain high-quality employees; studies show better compensation and benefits is the number one reason candidates cite for accepting a job.
  • Creates a healthy culture; having healthy employees’ results in increased productivity and reduced absenteeism. This mitigates some of the cost of providing the benefits plan.
  • Tax Deduction; they are a tax efficient way to increase a compensation package for both employee and the employer.
  • Cost Effective protection for employees and their families; there are no requirements to pay into CPP or EI and the employee gets tax free medical benefits.
  • Increased morale; it helps establishes the company policy on health and sickness, employees feel that their well being matters.
  • And last but not least… Employees value employee benefits! For some people it can mean the difference in whether or not they or their child can get something like braces or glasses.

Today, top employees demand a comprehensive health insurance plan.  In fact, in a 2016 Canada health survey, 77% of respondents say they wouldn’t move to a job that didn’t include some health benefits.

As an employer that gives some solid reasoning as to why you should implement benefits (if you don’t offer them already). Employees are looking for a company that takes care of them and their needs, just as much as employers are looking for someone who takes care of the company and puts their best foot forward every day.

Employee benefits are just another reminder that you give what you get. In life and business it is doing things differently or better than everyone else that sets you apart. The truth of employee benefits is that offering them at all can help you rise above the competition when it comes to recruiting your next star employee.

5 Languages of Appreciation (Adapted from the 5 Languages of Love)

Have you heard of the five languages of love? You know, how to show that heartfelt deep commitment to the ones your love. Now, lets put a business spin on that. Did you know there are also five languages of appreciation?

One quote from Clemens Rettich is, “If every single day is not customer appreciation day you may as well close your doors.” Sounds exhausting, right? More so because as we know, good businesses treat their customers well but better businesses also treat their employees – and suppliers – well.

The subject  of appreciation came up in our B4B Low Town Round Table a few weeks ago and a guest shared this list. I have pulled it off www.appreciationatwork.com, the website of Drs Paul White & Gary Chapman.

This list might apply more to the workplace than customers, though I certainly give customers a hug, a coffee or lunch, help out with a silent auction item, high fives in public.

Here’s the list; how can you make it work for you?

The language of physical touch:

  • Spontaneous, celebratory displays (high five’s, fist bumps, a pat on the back)

Quality time:

  • Stop by to see how they’re doing. Spend a few minutes just chatting and checking in
  • “Hanging out” together with colleagues, working on tasks together collegially, having coffee or lunch together
  • Having different types of experiences together to deepen relationships

Acts of service:

  • Ask if the other person wants assistance, if they need anything done
  • Do the service in the way the recipient wants it done

Verbal praise:

  • Words of affirmation communicated in front of others
  • Tell them, “I’m glad you are part of the team.”
  • Written communication through hand written notes, email, texting
  • Write a Thank You email; “I just wanted to let you know …; “It is really helpful to me when you ….”

Tangible gifts:

  • Less about the “thing” and more about reflecting that the giver knows what is important or valued by the recipient
  • The financial value doesn’t matter; can be as small as a card or a single flower

Try one of these great methods of appreciation in the workplace, be it with a co-worker or a customer! Leave a comment to let us know how it worked out!

Customer Service And The 80/20 Rule

During our Round Table Conversation at Business for Business Nanaimo North this week, we discussed the importance of quality customer service, and building customer relations.

  • How do you define customer service for your business?
  • Do you have a system and skilled people in place to provide quality service?
  • Do you treat your customers like you would like to be treated?

There are various definitions of quality customer service, but I like this one by Paul Mckinney in Study.Com:

“Customer service is the act of taking care of the customer’s needs by providing and delivering professional, helpful, high quality service and assistance before, during, and after the customer’s requirements are met. Customer service is meeting the needs and desires of any customer.”

What are some of the key elements of quality Customer Service that are important to your clients?

If you want to be proactive I suggest that you talk with your present customers who continually buy your products and/or services, and ask them what are their expectations and why do they continually buy from you.

Why guess – go directly to them and ask pertinent questions for their honest feedback.

What are some of the characteristics of quality customer service?

  • Promptness: Answer promptly and deliver promptly. Under promise and over perform.
  • Listening: Customers need to feel that you have listened to them and heard their needs. Even if you cannot solve their problem they have been heard.
  • Patience: when dealing with their problems take the time to ask questions and ensure that they agree with your interpretation of their needs. Provide competent service instead of rushed service.
  • Politeness: Saying ‘hello,’ ‘good afternoon,’ and ‘thank you very much’ are a part of good customer service. For any business, using good manners is appropriate whether the customer makes a purchase or not.
  • Product knowledge: Know your products/and or services in depth. Then you can best help solve your customer’s problems.
  • Be positive: Your tone and words need to convey positive actions. Statements like “I can’t or I will not” are negative in nature and reduce confidence in you resolving their issues. “I can or I will” convey positive actions and reduce customer anxiety.
  • Professionalism: Training your staff in quality customer care skills and monitoring their progress will ensure a level of professionalism. Professionalism shows the customer they’re cared for.
  • Personalization: using the customer’s name provides recognition and a personal touch. Customers feel that you are focusing on them and their needs.

Social Media

And then there is social media.

Social media can be a great way to expand your business but it can also be a curse. In today’s internet world of Facebook, Twitter, Pinterest, etc. you want to ensure that you have more positive reviews than negative reviews.

Since this is a critical area these days I suggest that you contract or hire the experts who live and breathe in this part of the world. People are people and you do not know what side of the bed they got up on that day.

They could have a valid reason for a complaint and you need to hear it, recognize it and verify it clearly with them. Having a skilled customer service rep on top of it every day is critical in controlling a positive image and showing your ideal customers that you take action.

Pareto Customers

You may have heard of the Pareto principle (also known as the 80/20 rule) that states that, for many events, roughly 80% of the effects come from 20% of the causes.

In business, roughly 80% of your business comes from 20% of your customers.

In your social media relationships, you want more than 80% positives and less than 20% negatives. Even when people read negative comments about your company, your ideal customers need to see that you are actively trying to resolve problems that really do apply to your company’s products and /or services.

Also keep in mind that there are good customers and bad customers. Drop your bad customers (or send them to your competition) and attract more good customers with your words and actions.

Positive actions retain and attract customers and negative actions or inaction cause customers and potential customers to leave.

Happy customers are your future! Take care of them to ensure future growth.

John Boudreau, Nanaimo North

How ‘Authentic’ is Your Made in Canada Corporate Gift?

You’ve been tasked with buying a gift for a visiting executive, your event keynote speaker, or maybe a foreign dignitary. Your goal is to find an item that portrays quality, represent Canada’s uniqueness and culture, and reflects your corporate values. But where do you start?

To buy your precious gift, you are not likely going to the local tourist shop to buy some tea towels with images of loons and beavers. You need to find a reputable dealer who is well connected to original and genuine Canadian-made gifts. They can help you through the myriad of authentic versus knock-off items that can result in a misguided purchase.

Here are a few things you need to consider; is it really Made in Canada? There are government rules and guidelines around professing that a product is Made in Canada, but they are not always apparent when it comes to labeling. For example, an item might be designed in Canada but actually made in India or China. Or, a base object has been brought in from offshore and painted or altered in Canada. The details are not always visible, so be sure to ask your product source for what they know, or what they can find out.

Based on the Canadian Competition Bureau, here are few guidelines to consider:

For a product to be labelled “Made in Canada“, the following need to happen:

  • at least 51% of the total direct costs of production is Canadian
  • the last substantial transformation of the good needs to happen here in Canada

For a product to be labelled “Product of Canada” the following guidelines apply:

  • the last substantial transformation of the good occurred in Canada
  • 98% of the total direct costs of producing or manufacturing the goods have been incurred in Canada

Alternative language is often used to be more specific about product origins like, “Assembled in Canada with foreign parts” or “Sewn in Canada with imported fabric”. Although there are varying subtleties based on food, textiles, and other categories, here is a simple example of what a ‘Canadian’ chutney product might look like:

  • Packaged in Canada – nominal processing in Canada
  • Chutney was produced in bulk in the US, but placed in jars and labelled in BC
  • Made in Canada – a Canadian entity does the key processing
  • Labels might say ‘Made in Canada’ from domestic and imported ingredients”, if a BC food processor used fruit and vegetables from The Okanagan and cane sugar from the Caribbean.

Product of Canada – the whole supply chain is in Canada

The chutney could qualify for this designation if, for example, they used fruit and vegetable ingredients from the Okanagan and Manitoba beet sugar. The ingredients, processor, and assembly is all in Canada.

Made in Canada or Canadiana?

More and more companies are using Canadian Made gifts when promoting their businesses. The quality of them are far superior, with high perceived value. The recipient feels more appreciated and valued. These gifts are an important part of building a business network, especially internationally.

But are you giving a Made in Canada gift or just something depicting Canadiana?

Your local tourist shops are full of Canadiana, products showing icons of our culture. The Mountie t-shirt, or moose coffee mug. Maple leaf pens and candies. And replicas of First Nations art on a keychain.

The shop inventory will be 95% made offshore.

Some shops will have serious, authentic First Nations art, but the shop worker won’t know if it’s truly Made in Canada, or only partially so.

How to Ensure Native Canadian Art Is Genuine

Most authentic First Nations art comes with an enclosed information sheet or card with a bio of the artist, and description of the piece. However, there are still some things to be aware of. Soapstone carvings are absolutely an iconic First Nations art form. Genuine native carvers put an arctic igloo icon on each piece to show that the artist is First Nations. But, there are also great soap stone carvers who are well known but are not native. If that is important to you, look for that native logo.

Someone like artist Sue Coleman paints watercolours with native symbols in them. She is not First Nations but incorporates traditional designs, and is famous for it. Other examples show bowls made offshore but hand painted here, and purses made in Indonesia but the native design is applied here.

The price point will also tell you if it’s genuine or not. Genuine First Nations art works will have a higher price tag than a knock-off Canadiana item.

How Do You Find the Truth?

Find a reputable dealer! They will source genuine high quality products. You need someone who has studied the laws, rules and guidelines; someone who knows how to get the answers to ensure authenticity, or at least what the supply chain sources are. To many people that is extremely important.

A reputable dealer will have extensive experience and deals with government, universities, and corporations. Ask for references or to see testimonials. If they are a member of your business network, they can answer those questions in person.

Next Steps

Your gift requirements may also extend to employee recognition, very important clients, or key people in your referral network. By presenting them with a quality, authentic Canadian made gift shows that you care and respect them. Your good will is appreciated and often talked about with their peers, family and friends, when they receive a special gift!

Property Tax Deferment Program British Columbia

deferring your property taxes in british columbia

Many BC homeowners have questions about how and when you can defer your property taxes If you are a home owner in British Columbia your property tax notice provides information including how much your property taxes are, when they are due, and how you can claim a home owner grant.

In 2017, the due date for property taxes is July 4. If you fail to pay your taxes by that date, a 5.0% minimum penalty is levied on any amount outstanding.  It should also be noted that some municipalities have increased the penalty. For example, the penalty is 10% in the City of Victoria.

If you qualify and your property meets certain eligibility requirements, you may be able to defer your property taxes. If you choose to defer the taxes, a lien is registered against the title to your property which will remain on title until the amount owing is paid in full. A $60 fee is also charged for the deferral and interest will be charged on the deferred amount.  The interest rates are set every six months by the Minister of Finance.

There are two deferral programs: (1) the regular program and (2) the program for families with children.

THE REGULAR PROGRAM

You may qualify for the regular program if you are:

  • 55 years of age or older (only one spouse needs to qualify);
  • a surviving spouse, regardless of age (i.e. you have lost your spouse by death and are not the spouse of any other individual); or
  • a person with disabilities.

There are also several other requirements, including but not limited to the following: you must be a Canadian Citizen or permanent resident; you must be a registered owner of the property; you must have and maintain a minimum equity of 25% of the property’s assessed value; and you must have paid all previous year’s property taxes, utility user fees, penalties and interest, if any.

Your property may not qualify for the program in certain circumstances. For instance, your property doesn’t qualify for tax deferment if it’s a second residence such as a summer home or rental home or if you pay the property taxes for the residence to a First Nation.

THE FAMILIES WITH CHILDREN PROGRAM

For the families with children program, you may qualify if you are:

  • a parent;
  • a stepparent; or
  • financially supporting a child or stepchild.

There are also several other requirements, including but not limited to the following: you must be a Canadian citizen or permanent resident; you must be a registered owner of the property; you must have and maintain a minimum equity of 15% of the property’s assessed value; and you must have paid all previous years’ property taxes, utility user fees, penalties and interest.

The same qualifications for the property apply to this program as do for the regular program set out previously.

It can take up to several months for the tax deferment applications to be processed. You may not get a response until after the property tax due date. If the application is received before the property tax due date but is approved after the due date, you may not be charged a late payment penalty.

You may however be charged a late payment penalty if:

  • your application is made after the property tax due date;
  • your application isn’t approved and it is past the property tax due date;
  • you fail to provide the required information;
  • you sell your home before the taxes are paid on your behalf; or
  • if you cancel or withdraw your application for any reason at any time before the taxes are paid.

Always see a qualified lawyer or accountant when making decisions about deferring your property taxes. The professionals who are members of Business for Business Networks are part of a trusted community.

What Is Probate?

A common question lawyers are frequently asked is, “what is probate?” When someone passes away in British Columbia, typically the deceased’s sole assets (i.e. bank accounts and property) cannot be dealt with until the deceased’s personal representative (i.e. the executor if there is a will and the administrator if there is no will) applies to the court for a Grant of Probate.

A Grant of Probate is essentially a certificate issued by the court that certifies that the deceased’s will is valid. Financial institutions and the Land Title Office generally require that the executor produce a Grant of Probate, prior to allowing the executor to deal with the deceased’s assets.

In order to have the court certify that the will is valid, the executor must submit a number of documents to the court for the court’s review. These often include, but are not limited to, the following:

  • An affidavit which has general information about the deceased, the executor and the probate application;
  • An affidavit of the executor stating the amount and location of the deceased’s assets and liabilities; and
  • An affidavit stating that the beneficiaries have been made aware of the probate application.

A notice is then provided to the beneficiaries notifying them of the probate application and their rights. Once the court has reviewed and approved the probate application, the court will advise the executor what probate fees are payable by the deceased’s estate. Once the probate fees are paid, the Grant of Probate will be issued and the executor may begin dealing with the deceased’s assets by:

  • Calling in (or liquidating) assets;
  • Paying debts of the deceased and the estate;
  • Paying taxes for the deceased and the estate;
  • Distributing assets to the beneficiaries; and
  • Applying for a clearance certificate from CRA.

If someone passes without a will, the process described may still be required (depending on whether the deceased individual had any assets in his or her sole name and the value of such assets); however, rather than applying for a Grant of “Probate,” an interested party would need to apply to a court to (a) be appointed as the “administrator” (as opposed to the “executor”) of the deceased’s estate and (b) to request that the court issue a Grant of “Administration” (as opposed to a Grant of “Probate”).

This is a brief summary of one of several steps involved in dealing with a deceased individual’s assets. Lawyers specializing in this work, not only act as legal counsel for executors of estates but we also act as executors for estates.

Corporate Gifts that Stand Out

Remarkable corporate gifts from creative cakes Duncan BC

When you think about corporate gifts, what’s the first thing that usually comes to mind? Probably cookie cutter gift baskets at Christmas, right? Traditionally that is the common time to do appreciation gifts. But is that the best time and is your basket really being appreciated and remembered? If that’s when you’re doing your gifting, you are likely not getting the best bang for your buck!

With so many corporate gifts being given at Christmas time you can easily get lost in the shuffle. Often gifting companies are also very busy during that time so even if you wanted something less cookie cutter you’d have to pay a premium.

So where does that leave you then? Not bothering? Certainly not, there are great options to help you be memorable!

To stand out do more personalized gifts for your clients, suppliers, or special connections. This can certainly be a more expensive option, but if you have the budget, it’s the way to go! That said, there are also ways to make it more affordable. If you use the same company for the gifts each time you can make a special arrangement with them with the promise of regular buying, even a contract perhaps. By guaranteeing them regular business they’re more likely to be willing to discuss price discounts.

If you’re able to do the personalized gifts the best way to do it is to find out the time the recipient would most appreciate the gift. Gifting to an accountant? Why not some edible treats the last few days of April when they’re the busiest for tax season? Have a florist to gift to? Similar thought can apply to them near Mother’s Day or Valentine’s Day when they’re crazy busy. Find out when they’d appreciate it the most and give them a gift. Not only would it be more appreciated but it would really stand out from the crowd and be remembered.

Don’t have the budget for personalized gifts throughout the year? There’s still a great way to stand out and it’s simply to gift at a different time. Perhaps being thankful at thanksgiving or even ringing in spring with a special treat. It can even be something more personal to you, perhaps your company’s anniversary. Pick a date that works for you and your budget. Many companies can be really quiet during December and not have the budget for gifting then, by picking a different time of year you can pick the time you also have a budget for it!

Any corporate gifting company would be happy to chat with you about ideas and ways to make your gifts special.

So, when you’re thinking corporate gifts next, maybe leave Christmas to just Christmas cards and pick a better time to stand out from the crowd!

Canadian Mortgage Game-Changer

Canadian Mortgage Game Changing Overnight

Bill Morneau, the Minister of Finance, announced changes to insured mortgages on Monday morning that will have a major impact on Canadians.  The government’s attempt at cooling a hot housing market as a result of their lack of regulation where foreign buyers are concerned will now penalize Canadians. The changes don’t only make it far more difficult to obtain a Canadian mortgage as a new home owner but it may take away the ability of Canadians to manage the equity in their homes and to access fair competition upon renewal of their Canadian mortgage.  Vancouver and Toronto are not the only housing markets to consider.  Canada is a big country.

Mortgage Rates Almost Double

Any purchase less than 20% down requires default insurance provided by either CMHC, Genworth or Canada Guarantee.  As of October 17, 2016, any buyer with less than 20% down must qualify at the benchmark rate that the Bank of Canada sets (currently 4.64%).  Today any buyer who takes a 5 year fixed term can qualify at the contract rate (average of 2.44%).  For variable rates and terms less than 5 years, the benchmark rate must be used to qualify.

The Canadian mortgage business is made up of a few players – insurers, non-bank lenders (monolines), banks and local credit unions.  Monoline lenders currently “blanket” insure their mortgages to mitigate risk and attract investors regardless of the amount of equity in the property.  Banks do not have to insure their low ratio mortgages (more than 20% equity).

If monoline lenders continue to blanket insure their mortgages, ALL of their borrowers must qualify at 4.64% at a 25 year amortization.  Also, the way it currently appears is that refinances or rentals will no longer be insured.  That could mean that you can no longer take equity out of your house for a renovation or investment or consolidate that 19% credit card debt that the government continues to ignore.  If they are so worried about the Canadian debt load, why are we still paying 19% on credit cards?  Why is there no proof of credit or income required to qualify for a credit card??

Another Step Towards Bank Monopoly?

WAIT!  – if you want to take equity out of your house or debt consolidate, you can still go to a bank if you want!  If banks monopolize the Canadian mortgage market going forward,  the competition for your business will disappear and the banks will control what you pay.  The bank profits continue to soar while the Canadian consumer debt gets higher.  Where is the balance?

And to top it all off, the biggest players in this decision were not consulted or advised.  Insurers, lenders and brokers all found out at the same time Monday morning and are scrambling to figure out what exactly it all means to their business and their clients.  We are still waiting to find out exactly how the lenders will handle the changes and how exactly how it will affect you.