MLN NewsStream

Higher yields are spawning ominous headlines like: "Canadian Bond Yields Surge, Mortgage Costs To Climb Ahead of Spring Market."

It sounds like a cliffhanger, but the reality is less sensational. At this point, there's no clear indication that rates will shoot up enough to derail the spring market. Here's why.

Canada's 5-year yield has been on a comeback tour, giving up more than half of its downward progress since the October high. It's now surged 64 bps in six weeks, and fixed mortgage rates might finally follow suit.
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What's kicking up this dust? Inflation worries. The market crowd is losing faith in the 'next move is a rate cut' theory—or at least in the 'rate cut by summer' theory.

A savvy subset of mortgage professionals has been craftily cashing in on this strategy for some time.

For those who haven't—but seek a leg up—the following approach will paint you as a customer's trusted partner in finance, as opposed to just another transactional salesperson.

Any mortgage pro will tell you, there's no shortage of options for borrowers who can't, or don't want to, qualify for a mortgage the old-fashioned way—i.e., using traditional bank guidelines and income docs.

Catering to this paperwork-averse crowd requires a well-stocked arsenal of products and knowing all the best off-the-beaten-path lenders.

NPX is just such a lender, and it belongs in broker toolkits for one simple reason:

A sharp-minded MLN reader asked two important questions yesterday that deserve a broader response:

#1. "With U.S. consumers fueling the economy through credit—and not feeling the effects of the rate hikes due to long mortgage terms—couldn't that potentially push rate cuts out in the US and Canada?

#2. Don't we need to see a declining economy on both sides of the border for rate cuts to happen?"

Answers incoming...