It seems some money lenders are not happy with the new Mortgage rules, so they are attempting to bamboozle the system by marketing something called a Bundled Loan (or as I call it bungled mortgages ). The CBC’s explanation of this new poly-morphed debt vehicle is:
Image courtesy of Stuart Miles at FreeDigitalPhotos.net
Canada’s subprime mortgage providers are increasingly teaming up with unregulated rivals to sidestep rules designed to clamp down on risky lending. … The result of these partnerships are so-called bundled loans, which pair a primary mortgage with a second loan from unregulated groups called Mortgage Investment Corporations (MICs).
This loan offer appears to be nothing more than the old trickery of offering 1st, 2nd, and perhaps even 3rd mortgages, except that the 2nd and 3rd mortgages are being provided by different lenders. Despite the fact that this practice is not illegal, the primary lender is obligated to consider all of the borrower’s outstanding debts when offering the main mortgage. It is unclear whether they are taking into account the other parts of the loan bundle. Nevertheless, this situation is a clear example of mishandling mortgages and should be addressed as such.
It is Friday the 13th today. Is it a bad day to invest? I don’t know call me in a year and I will tell you. Should you sell on Friday the 13th? Depends on what you are selling, and whether what you sell goes up in value after you sell it. I never get tired of giving these kind of testicle busting comments. Did you realize that Friday the 13th, always occurs after a Thursday the 12th ?
My Writings for Week Ending January 13th
Last week the year end employment numbers were published by our friends at Stats Canada, and it showed that 2016 Was the Year of the Part-time job, since that is where most of the job growth in Canada took place. It is good there are more jobs, but it is disturbing to see that many folks careers now consist of a few part-time jobs, quilted together to create enough income to live on. Let us hope they are not also looking for bungled mortgages.
A Money Thought
Well, it costs you money, because in Ottawa it is Pothole season!
A Golden Torrent of Financial Stories
I just could not resist, after the much naughtier version of that title trended on Twitter, why do I even worry?
- Tom Drake asks the interesting question, Should You Invest in Canadian Dividend Stocks? If we ask our friend Mark at My Own Advisor the answer is obvious, and Tom mentions lots of interesting individual stocks (I prefer Dividend ETFS like VDY ), so I think Tom agrees with Mark in this area.
- Speaking of Canadian Dividend stocks, Mark from My Own Advisor gives us Top stocks for 2017, where he lays out some possibly good Canadian dividend stocks you could invest in (after checking around and researching things first). Of course, you could also just buy ZDV instead? Just sayin’
- Mark from the Blunt Bean Counter, points out that with the new disclosure rules in place, he asks Your Investment Return – What Is It Telling You? Can you understand what it is telling you? You had better it is your money (after all). If you simply file your investment statement without understanding it, your investment adviser has a fool for a client (and they are very happy about it).
- After checking your returns, did you see that you beat the market? The Canadian Couch Potato has a new Podcast out, Podcast 3: A Hedge Fund Manager Comes Clean, where this “reformed” manager tells us that the illusion of thinking you can beat the market, shouldn’t be part of your investment plans. As with all things, yes, you might beat the market for a year or two, but as has been said, “Even an ugly dog has the sun shine on his arse sometimes”.
- Julie Cazzin wrote an interesting (one might almost say Tory-like ) article in Moneysense on Bill C-27 could mean changes for DB pensions. She takes the view that the Federal Pensions that Civil Servants have, are a big risk to the Government, which is true, but all Pensions that are Defined Benefits are huge risks to the employer, aren’t they? Anyhow, an interesting perspective. How will the government keep paying those pensions? I don’t know, but I guess I’ll find out soon.
- Speaking of work-life balance, in France they have passed a new law, where an employer cannot compel employees to check their work e-mails outside of normal work hours (without compensation), however the Harvard Business review has a contrary view on things with, Why the French Email Law Won’t Restore Work-Life Balance .
- The Washington Post did some fun with arithmetic, and pointed out that if investing results drop a little it could make the millennials saving plans go awry, in their piece, Millennials may need to double how much they save for retirement
- Michael James shows a paternal streak asking the following good question, What Do You Have to Show for Your Work? MJ depressed the hell out of me about 15 years ago when he asked, “So, now you have earned over a million dollars, how much do you have in savings?”, I hate it when he asks those questions (but he is asking the right questions, no matter how uncomfortable he makes you feel).
Risk in Investing
Do you think you really understand Risk? I don’t think you do…
2016 Random Thoughts Year End
- December 9, Xmas It Gift, Loose Money and #MoneyTalk
- December 16, Interest Rate Hikes, TFSA Limits and #Moneytalk
- December 23, Merry Christmas, Highspeed Internet a right, Inflation at 1.2 and #MoneyTalk
- December 30, Go Away 2016, Deep Thoughts, End of Year and #MoneyTalk
- January 6th, Merry New Year, CPP, EI and #MoneyTalk
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Adding up your total career earnings can be a real eye-opener.
It is hard to keep your eyes open, when they are full of tears….
How did you go about calculating this?
Add up “line 150” every year? (this line number is off the top of my head so might be wrong line, net income line?).
Whatever the “Net Income” is yes, add that and if you average even $50K net income after 20 years you have earned a Million Dollars! Or you have spent a Million Dollars!