What’s New? Effective April 19, 2010, the following changes will apply based on changes announced by the Department of Finance earlier this year:                 Changes to Qualifying Interest Rate                 Changes to Loan to Value (LTV)                 Changes Related to Rental Properties                 Changes to Insured Second Home Criteria

Products                 CIBC Mortgages                 FirstLine Mortgages®                 President’s Choice Financial® Mortgages

Details Changes to Qualifying Interest Rate                 Applicable to both insured and conventional mortgages including FirstLine Matrix Mortgage SuiteTM, ACCESS Mortgage® and PCF Secured Borrowing Account (SBA). Mortgage Type Qualifying Rate Fixed rate mortgages with a term less than 5 years Greater of MQR* or Contract Rate All variable rate mortgages Greater of MQR* or Contract Rate Fixed rate mortgages with a term 5 years or greater Contract Rate Note: 1) For the FirstLine Matrix Mortgage Suite, the loan portion will be qualified based on the criteria as set out above and the line of credit portion will be qualified at the Mortgage Qualifying Rate (MQR). 2) For the PCF Secured Borrowing Account, the qualifying rate is the Secured Qualifying Rate (SQR). 3) The *‘MQR’ or ‘SQR’ is defined as the Chartered Bank-Conventional Mortgage 5 year rate that is the most recent interest rate published by the Bank of Canada every Wednesday and can be found by clicking on the following link http://www.bankofcanada.ca/en/rates/interest-look.html and then clicking the tick box “V121764” – 5 year mortgage rate within the “Conventional mortgage” section. 4) The Contract Rate includes any discretionary pricing. 5) Applications dated before April 19, 2010 will continue to be adjudicated based on the old rules provided the borrower has a legally binding purchase and sale agreement that’s also dated before April 19, 2010. Changes to Loan to Value (LTV) Insured Mortgages New LTV Effective April 19 Refinances (ETO) 90% LTV    Non-Owner Occupied Rental 80% LTVperties LTV Prior to April 19                                         95% LTV                                                95% LTV

 

Total Debt Service Ratio for Insured Refinance Mortgages:                 The maximum TDSR for insured refinance mortgages is limited to 42% from previous tier system based on bureau scores. Changes related to non-owner occupied rental properties and owner occupied properties with a rental component Conventional Mortgages – non-owner occupied rental properties where the borrower does not own more than 2 rental properties                 50% of the gross rental income can still be added to the Gross Annual Income.                 The option to deduct 30% of the gross rental income from the PITH has been eliminated.                 Revised acceptable calculation: PITH* (subject property) + other debts service costs + PITH (any other rental properties) Gross Annual Income + 50% of Gross Rental Income (from subject property and any other rental properties) Conventional Mortgages – owner occupied properties with a rental component                 50% of the gross rental income can now be added to the Gross Annual Income (previously 80% of the gross rental income could be added to the Gross Annual Income).                 The option to deduct 30% of the gross rental income from the PITH has been eliminated.                 Revised acceptable calculation: PITH* (subject property) + other debts service costs + PITH (any other rental properties) Gross Annual Income + 50% of Gross Rental Income (from subject property and any other rental properties) Insured Mortgages – non-owner occupied rental properties and owner occupied properties with a rental component                 The option to deduct 80 % of the gross rental income from the PITH is no longer applicable.                 50% of the gross rental income can now be added to the Gross Annual Income.                 This applies to owner occupied properties with rental component (combination) properties and all rental properties.                 Revised acceptable calculation: PITH* (subject property) + other debts service costs + PITH (any other rental properties) Gross Annual Income + 50% of Gross Rental Income (from subject property and any other rental properties)                 For owner occupied applications with a rental component owner occupancy must be confirmed at the time of application.                 Rental income from all other rental properties is to be treated in the same manner as other non salaried income. Net income must be supported using the average income from the previous two years showing on the borrower’s Notice of Assessment or audited financial statements prepared by a licensed accountant. *PITH means cost of principal, interest, taxes, and heat plus 50% of the condominium fees, and 100% of site ground rent for leasehold. Changes to Insured Second Home Criteria                 Insured second homes must be one unit owner occupied properties. Previously the property could have up to 4 units.                 An insured second home must be owner occupied by the borrower or a relative of the borrower on a rent free basis; owner occupancy must be confirmed at the time of application.

Effective Date April 19, 2010

Any Questions? Please contact Daryl Woodill @ 441-0751

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Sales of Real Property

The HST rate of 15 per cent would generally apply to a supply of real property by way of sale in Nova Scotia if both ownership and possession of the property are transferred to the purchaser on or after July 1, 2010. Example 12: In January 2010, a land developer enters into an agreement to sell a small commercial mall to an individual. Ownership and possession of the mall will transfer to the individual in August 2010. The HST rate of 15 per cent would apply to the sale of the mall. For deemed supplies of real property by way of sale the general rule is that HST at the rate of 15 per cent would apply if the deemed supply is made on or after July 1, 2010. However, this general rule may not apply for deemed supplies of housing where the builder makes a sale of new housing together with leased land. See the section of this Notice on Grandparenting for Sales of New Homes. For information on transitional rules for commercial leases and non-residential real property (including transient accommodation), see the section of this Notice on Leases and Licences.

Sales of New Homes

Generally, sales of newly constructed or substantially renovated housing would be subject to the HST rate of 15 per cent if both ownership and possession are transferred on or after July 1, 2010. Where, under a written agreement of purchase and sale, ownership or possession of the home is transferred to the purchaser before July 2010 the HST rate of 13 per cent would apply. Grandparenting would be provided for certain contracts — see the Grandparenting section below. Rentals of New Homes Builders of newly constructed or substantially renovated single-unit homes or residential condominium units who rent out the new homes or condominium units — or, in the case of new traditional apartment buildings or additions to existing apartment buildings, the first unit in the building or addition — would generally be required to pay the HST rate of 15 per cent under the self-supply rules if the rental occurs on or after July 1, 2010. Grandparenting would be provided for certain contracts — see the Grandparenting section below. Where the builder is required to self-assess HST under the self-supply rules prior to July 2010 the HST rate of 13 per cent would apply. Grandparenting for Sales of New Homes A builder’s sale of new or substantially renovated single-unit homes, duplexes, mobile homes, floating homes and residential condominium units would be grandparented (i.e., not subject to the increased HST rate) where the written agreements of purchase and sale are entered into on or before April 6, 2010 and both ownership and possession are transferred under the agreement after June 2010. Grandparented sales of these homes would be subject to the HST rate of 13 per cent. Grandparenting would not apply to sales of traditional apartment buildings and homes built or substantially renovated by owners for their personal use. In the latter case the transitional rules for tangible personal property and services would apply to the acquisition of construction materials and services used in the house construction or substantial renovation that straddles July 1, 2010. Grandparenting would generally not apply to deemed supplies of real property by way of sale, including builder-landlords that are required to self-assess HST under the selfsupply rules on newly constructed or substantially renovated housing on or after July 1, 2010. However, where a builder is required to self-assess HST under subsection 191(1) of the ETA in respect of an exempt sale of the building part of a single unit residential complex or a residential condominium unit and a supply by way of lease, or an assignment of a lease, of the land part of the complex or unit, the rate of HST payable in respect of the deemed supply would be determined by the date the agreement for the purchase and sale of the building was entered into. Where the agreement was entered into on or before April 6, 2010, HST at the rate of 13 per cent would apply to the deemed supply made by the builder even if the deemed supply is made on or after July 1, 2010. Where the agreement was entered into after April 6, 2010 the general rule for deemed supplies of real property by way of sale would apply — i.e., where the deemed supply made by the builder is made on or after July 1, 2010 HST at the rate of 15 per cent would apply. Nova Scotia New Housing Rebates Administration of the Nova Scotia new housing rebates would transfer from the Canada Revenue Agency (CRA) to Service Nova Scotia and Municipal Relations. Nova Scotia new housing rebate claims for sales of new housing together with land, sales of new housing together with leased land and houses acquired through the purchase of qualifying shares of a housing cooperative would continue to be submitted to CRA where the written agreement of purchase and sale for the housing or shares, as the case may be, is entered into on or before April 6, 2010. Nova Scotia new housing rebate claims for owner-built homes would continue to be submitted to CRA where the application for the rebate is filed before July 1, 2010. Nova Scotia new housing rebate claims for sales of new housing together with land, sales of new housing together with leased land and purchases of qualifying shares of a housing cooperative would be submitted to Service Nova Scotia and Municipal Relations where the written agreement of purchase and sale for the housing or shares, as the case may be, is entered into after April 6, 2010. Nova Scotia new housing rebates for owner-built homes would be submitted to Service Nova Scotia and Municipal Relations where the application for the rebate is filed on or after July 1, 2010. In addition, for Nova Scotia rebates in respect of sales of new housing together with land, sales of new housing together with leased land and purchases of qualifying shares of a housing cooperative where the applicable rebate claims would be required to be submitted to Service Nova Scotia and Municipal Relations, the builder would no longer have the option of paying or crediting the applicable Nova Scotia new housing rebate to the purchaser at the time of purchase. However, builders would continue to have the option of paying or crediting the applicable GST new housing rebate and therefore could continue to price their sales of new housing net of the applicable GST new housing rebate for agreements of purchase and sale entered into after April 6, 2010. Where written agreements for the purchase and sale of housing or qualifying shares are entered into after April 6, 2010 and the purchaser of the housing or qualifying shares would be entitled to claim a Nova Scotia new housing rebate, the purchaser would be required to submit their claim to Service Nova Scotia and Municipal Relations. Nova Scotia new housing rebate factors for sales of new housing together with leased land and sales of qualifying shares of a housing cooperative would be adjusted to 1.31 per cent to reflect the increase in the HST to 15 per cent. Rebate forms and other administrative information will be provided in the coming months for Nova Scotia’s new housing rebates. Builder Disclosure Requirements for the Transitional Period If a written agreement of purchase and sale for a newly constructed or substantially renovated home is entered into after April 6, 2010 and before July 1, 2010, the builder would be required to disclose in the written agreement of purchase and sale whether the HST rate of 15 per cent would apply to the sale and, if so, whether the stated price in the agreement includes the HST rate of 15 per cent, net of the GST new housing rebate, if applicable. If the transaction would be subject to the HST rate of 15 per cent and the builder does not make a disclosure as outlined above, the builder would be required to remit based on a 15 per cent rate of HST. This proposed transitional measure would help provide certainty to both builders and purchasers with respect to the application of the HST rate increase under written agreements of purchase and sale for new or substantially renovated homes entered into during the transitional period.

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Attention First Time Home Buyers!!

Attention first time home buyers!! This 3 bedroom 1.5 bath split-entry is located on a quiet cul-de-sac in popular Millwood subdivision. Close to schools, shopping and all other amenities. Tastefully decorated with a nice layout for entertaining & a pellet stove to keep heating costs down, this home could be yours! Call today for a personal viewing!!! Call Scott Grace @ 441-7714 for more information or a personal viewing!

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New Construction!!! – $276,500

This wonderful split enrty could be your new home! Located on a quiet cul-de-sac of brand new homes. Super nice hardwood floors gleam throughout the home with the exception of the kitchen and bathrooms that sport ceramic tile. 3 Bedrooms on the main level with a bathroom that features a jacuzzi soaker tub. 1 bedroom in the basement along with a huge recroom and a 4 piece bath. Lots of room to play and grow! Basement also features a laundry room and garage with a walkout. Call Scott Grace @ 441-7714 for more information or for your own personal viewing.

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