Earlier this year the Federal government announced some changes to protect Canadian Consumers and their mortgages, including rule changes to credit cards and mortgage prepayment information.  
See the official news release here (http://www.fin.gc.ca/n12/data/12-025_3-eng.asp ).

Last week a the draft of guidelines proposed by Brock Kruger from  The Office of the Superintendent of Financial Institutions was released. In it you can see how the current economic state of the US is causing anxiety for lenders and economists. The proposal will affect nearly everyone, it will change how mortgages and secured lines of credit are offered and is seen by many as an unnecessary move.
The new purposed guidelines, AKA: Draft B-20 tightens mortgages and Home Equity Lines of Credit (HELOC) given out by the banks, however it does not target other lenders, leaving smaller institutions in a prime position. While media coverage has been sparse, you may find this article by Peter Foster in the National Post insightful, you can see it here (http://www.nationalpost.com/opinion/pain+RMUP/6333773/story.html).

In Short Here is a Summary of Possible Changes:
1. Cash back mortgages may be gone for good. As it stands, a bank may give out a mortgage for 95% of the purchase price and then give 5% cash back, which intern may be used for down payment. As many banks already caution against such practises, it comes as no surprise that this is first on the chopping block.
2. Upon the time of renewal, property would be have to be appraised in order to determine the a value and possibility of renewal. There is cause for debate with this change. If for example, after 5 years your mortgage comes up for renewal and the Real Estate market has dropped, you could be asked to pay down your loan, or worse, the bank could call in your mortgage.
3. Changes to Home Equity Lines of Credit (HELOC). Here the changes include: The maximum loan amount would be reduced from 80% to 65% of the value of the property. This comes on the heels of the more recent change from 90 to 80% in the last few years. In addition to the new maximum, HELOS's would now be amortized, effectively ending “Interest Only Payments”. Unfortunately this action would have an immediate affect on the self-employed seeking a loan, those looking to finance a business by using their homes as collateral and individuals looking to access their equity investments.
4. Mortgages would require tighter debt servicing guidelines, which would make exception approvals by the banks a very rare thing.

I will be updating you as more information is released on these changes and the possible repercussions to the Edmonton Real Estate market.
-Alison 
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Alberta Real Estate Association has recieved more reports of a scam that is being perpetrated in Alberta that not ony takes advantages of consumer, but implicates our members without their knowledge.

 How it works is a rental property is advertised on sites like Craigslist or Kijiji and the used to describe the property and the name of the listing Realtor apprears to have been scraped from Realtor.ca or elsewhere.  The scammer impersonates the Realtor when responding to prospective renters.

 Alberta Real Estate Association anticipates that, as markets heat up and rental property becomes more scarce, this type of scam may be seen more frequently.  AREA is taking actions to protect both our members and the consumers they serve.

 In addition to alerting the real estate boards and you, AREA has drafted a media release that, in partnership with local boards, will be forwarded to the media so that consumers can be warned about this type of scam. AREA will aslo communicate with Kijiji so that this scam can be added to the list of common scams on their site.

 When the prospective renter posted an inquiry, here is the response they received:

 Thanks for your interest in my Duplex. My name is (AREA: name of listing REALTOR® inserted here) I am a construction Engineer and I am the owner of the 3 bedroom Duplex . I have been transferred to one of our branches in West Africa and that is why I am putting up the Duplex for rent. The Duplex vital informative documents and the entrance keys to my Duplex is with us, we try to look for dependable agent to handle the rent but could not find one due to the limited time we had before leaving the country. Mostly we do not want our property to be given to any sort of person to avoid damages and troubles.The Duplex is available for rent and is available for long term and short term lease. 


Duplex Address: XXXX XXX Ave Edmonton AB, Canada
 This unit is available for immediate move in. Modern 3 beds and 3 Full Bath Basement:Full Suite the Duplex is strategically located in a very cool and lovely environment with five (5) appliances including dish washer with in-suite laundry and plenty of storage space and parking space . Professional and mature neighbors ensure peaceful living arrangements. Freshly painted and immaculately clean with private bathroom.
 We are looking for a responsible person that can take very good care of it as we are not after the money for the rent but want the property to be kept clean all the time as it is our hard-earned property. If you are honestly interested and will absolutely maintain our property (Taking care of it like yours) as I hope I can put my trust and confidence in you presently, I earlier wanted to sell the Duplex but had a second thought to rather put it up for rent. The rent is ($900 )including utilities Damages Deposit Fee ($400) So I will like you to get back to me so that I can forward you the full interior pictures to you to have an idea how beautiful and spacious the inside looks and i will like you to fill out the rental application form below.......

Full Name :
Address :
Phone # :
Gender :
Work :
Are You Married:
Marital Status :
Do you Drink Alcohol :
Pets :
Do you smoke :
How Many People Will Be Living In The Duplex:
Your Move-in Date :
Your Move-Out Date :

Thanks for taking your time in writing me and hope to hear back from you.
Best Regards
(AREA: name of REALTOR®) And Family

 What to Do?

If you come across an instance where you name is being used in this type of scam, after taking the appropriate steps, please email specifics to AREA (communications@areahub.ca) so that we can track the extent of this problem. 

Alberta Real Estate Association

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