Canadian Mortgage Market and Banking Sector not Vulnerable to U.S-style Meltdown

"The bottom line for Canadian borrowers", says Mr. Jaskolka, "is that those with good credit and qualifying incomes will not have a hard time finding money, while those with poor credit and some equity will need a mortgage broker to find lenders willing to assist them.

Toronto, Ontario, Canada (PRWEB) October 16, 2008 -- Troubling economic news from around the world, especially the United States, has had many Canadians questioning the health of their mortgage and banking sectors. The President of Canadian Mortgages Inc., a leading Canadian mortgage brokerage, is among the many experts seeking to allay the fears of Canadians by highlighting the continuing stability of the Canadian financial sector.

"Comparisons to the U.S. are inevitable," says Bryan Jaskolka of Canadian Mortgages Inc., "but the Canadian situation is dramatically different from the one playing out south of the border." For one, the economy here is stronger. Mr. Jaskolka notes that the U.S. economy has had several peaks and valleys over the last decade, and is experiencing a downward trend that began in 2006. In contrast, the Canadian economy enjoyed a steady increase during the same period. Not only has there been more job growth here, employment increases have occurred in many sectors of the economy. By comparison, U.S. job growth was tied heavily to the housing boom and, when it went bust, those jobs disappeared. Recent events have shown that the Canadian economy cannot escape the global turmoil, but even with many experts predicting a recession, Canada remains in a stronger position than other Western countries.

Mr. Jaskolka also noted that the kind of regulations needed to avoid a mortgage meltdown have been in place here for a long time. Mortgage requirements are tighter in Canada. There is far less sub-prime lending, with 1 in 20 Canadian mortgages falling into that category, compared to 1 in 6 in the U.S. This regulatory environment will help cushion the blow somewhat, although Canadian banks that packaged and sold some of their mortgages, like those in the U.S., will tighten their lending requirements and charge higher interest rates to try and make up for some of their losses. There has already been evidence of this trend as the banks recently decided to pass only 50% of the last Bank of Canada rate cut onto consumers.

"The bottom line for Canadian borrowers", says Mr. Jaskolka, "is that those with good credit and qualifying incomes will not have a hard time finding money, while those with poor credit and some equity will need a mortgage broker to find lenders willing to assist them. Further, for anyone looking to find a home in these challenging economic times, a mortgage broker offers their best chance at a good interest rate."

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