Tag: Canadian Banks

Information Regarding Car Loan in Canada

Information Regarding Car Loan in CanadaCar Loan vs. Personal Loan, What’s the difference?

A car loan is different than the regular personal loan but the method applied to both is almost the same. The most important difference between a car loan and personal loan is that car loan is secured against your purchased car and is short termed like 2 to 5 years normally and 2 to 7 years in some extended cases maximum. Another good thing is that car loan interest is only from 0 to 10% per year in Canada. On the other hand, a personal loan can or cannot be secured against an asset.

Car Lease vs. Car Financing, Which Option is better?

In Canada, if you travel a lot then you should not take the car on a lease because it limits your yearly kilometers but if you don’t travel much then this option is fine with you. Many people have a misconception that lease is only offered for the new car but that is not true at all. You can get a lease for a second-hand car but if this is costing you just as financing a new car, then you should pass that option and lease a new car as ample of warranties reduce the maintenance cost for you. Also, if you change your car after every 4-6 years, then leasing a car seems a better option.

Who Offers Car Loans in Canada?

Car loans in Canada are offered by many entities including some unconventional lending institutes, used car dealerships, new car dealerships, private lenders, used car lots, and even some bank.

  1. The new car dealerships do their own lending mostly. For instance, Volkswagen has its financing support through VW Finance that deals with the financing of new or used car purchases. Having good credits will ensure your finance at lower rates and improve your chances of being approved by bank.
  2. The used car directly work with Canadian banks to finance their customers which works out between them like banks pay the dealers directly when a car is purchased without involving the used car lots and ask the customer to reimburse the loan straight back to them. This kind of loan is sometimes considered as bad credit because most dealers don’t do background credit checks as they only care about their job stability or look for income.
  3. Many people try to find financing from the private lenders to purchase a new car. This option is somehow flawed because loan is safe against an asset which is your car. Now, what happens in this context is that the car is transferred to the moneylender, until the loan is paid. This method is also known as the car title loan.
  4. Certainly, if you get hold of an unsecured personal loan, you can do pretty much whatever you want with that money including buying a new car but unfortunately; unsecured loans are a small amount and tend to range only from $500 to $5000 that limits your buying options.

Canadian Banks Increase Prime Rates After Bank of Canada’s Rate Hike of July 20

The big 5 Canadian banks have been showing considerable rise in their prime lending rates today after the Bank of Canada’s rate hike earlier in this week. Banks like RBC, TD, BMO, CIBC and Scotiabank have increased their Prime lending rates by 0.25% to 2.75%, effective July 21. It also increased variable mortgage rates, including those offered by brokers as well, for the best mortgage rate that were closed at 1.75% for a 5 year variable previously was now expected to increase up to 2.00% now.

The Bank of Canada hiked its key interest rate by a quarter point earlier this week! For the second month in a row.

In its statement the Bank noted that it “expects the economic recovery in Canada to be more gradual than it had projected in last April, with growth of 3.5% in 2010, 2.9% in 2011, and 2.2% in 2012. This revision reflects a slightly weaker profile for global economic growth and more modest consumption growth in Canada.”

Most lending institutions including Canadian big banks are expected to respond to the Bank’s rate hike by increasing their prime lending rates by a minimum quarter point. However, lenders do vary in when exactly they adjust their rates for variable-rate mortgages. Contact your bank or a mortgage professional for more information on how a particular lender may implement a rate increase. As its a time when mortgage holders or potential borrowers should sit down with their mortgage professional to explore their options and decide what makes the most sense for their own financial situation.

A competitive five-year fixed mortgage rate is available to qualified borrowers at 4.29%, while with the Bank’s rate increased, a competitive variable rate mortgage is available to qualified borrowers at 2.15%, prime of 2.75 per cent minus 0.60 per cent.

Prime & variable mortgage rates update with Canada’s lenders / brokers / bankers as of July 21, 2010:

  • Dominion Lending – Prime rate: 2.75%; Change (%): +0.25%; Variable mortgage rate: 2.00%; Change (%): +0.25%
  • ScotiaBank – Prime rate: 2.75%; Change (%): +0.25%; Variable mortgage rate: 2.60%; Change (%): +0.25%
  • CIBC – Prime rate: 2.75%; Change (%): +0.25%; Variable mortgage rate: 2.60%; Change (%): +0.25%
  • RBC – Prime rate: 2.75%; Change (%): +0.25%; Variable mortgage rate: 2.60%; Change (%): +0.25%
  • Canada Trust – Prime rate: 2.75%; Change (%): +0.25%; Variable mortgage rate: 2.35%*; Change (%): +0%*

As far as the Fixed-rate mortgages are concerned, it will not get any changes directly by the Bank of Canada rate hike announcement as their rates are influenced more by movements in the bond market, tend to climb when traders shift investment activity to riskier equity assets from bonds that are considered safer.

Compare the Canadian best mortgage rates from banks and brokers!

Unclaimed Dollar Accounts in Canada with Canadian Banks

Information About Unclaimed Balances and Dormant Bank Accounts in Canada

Lying inactive your bank account does not affect your right over your money or assets staying with your bank, bank as a custodian always looking for the rightful owner to claim his/her money whenever he/she may remember or intimated. There are certain of reasons that you may not remember to maintain and claim your bank accounts like relocating, changing your banks, inheritance and a bad memory that could create a possibility to have your unclaimed balances with your bank in Canada.

Canadian banks are legally bound and required to send written notification to the owner of a dormant bank account, you will receive your first inactivity account notice after two years and other after five years if not responded the first one by your bank. After nine years of account being inactive and unanswered notices, the Bank Act authorized the Office of the Superintendent of Financial Institutions (OSFI) to publish information about all unclaimed balances of $100 or more in the Canada Gazette, which is available at most public libraries in Canada with the purpose to help people locate their unclaimed balances. After 10 years of inactivity, all unclaimed balances are then transferred to the Bank of Canada as a final authority and custodian on behalf of the owner.

How To Make A Claim and Find Dormant Bank Accounts in Canada?

There are millions of dollars, lying with the Bank of Canada from unclaimed bank accounts in Canada for the purpose to return the money back to its rightful owners free of charge. Bank of Canada holds unclaimed bank balances are exclusively Canadian-dollar deposits in, and negotiable instruments can be in any form of deposit accounts, bank drafts, certified checks/cheques, deposit receipts, money orders, term deposits, credit card balance, GIC, or traveler’s checks issued by, Canadian banks at locations in Canada. For the convenience of the general people the Bank of Canada provides an online search tool along with detailed instructions on how to claim money and assets that is yours. To avoid one of the most common ways money become lost, you may also check other people with you like names of your friends, relatives, co-workers, neighbors and anyone else you may think of either live or dead.

If you have found an unclaimed balance account, which you believe you are probably entitled to, you will have to complete the claim form that you will obtain from Bank of Canada. To claim funds from the Bank of Canada, you must follow the instructions carefully, submit it with the appropriate signatures and documentation required to prove your identity to support your claim to ownership of the funds. The bank then confirms your ownership, and after completing their portion of the form, forwards it to the Bank of Canada for recovery. The process a claim usually takes 4-8 weeks, although there may be delays due to the complexity of the claim and the volume of requests that the Bank of Canada receives.

The Bank of Canada makes information available to the general public free of charge as following:

  • By Internet: Unclaimed balances search database available online on Bank of Canada website (balances below $2.00 are excluded)
  • By Mail: Bank of Canada, Unclaimed Balances Services, 234 Wellington Street, Ottawa, Ontario K1A 0G9
  • By Fax: (613) 782-7802

Moreover, a request for a search database must include the full name of the individual along with applicant’s all the past residences addresses and the year of death is required in case the individual or applicant is deceased.

How Long Unclaimed Bank Balances are Held To Claim

The Bank of Canada maintains custody and holds all unclaimed balances for 100 years if $1,000 or more and for 40 years (10 years from the date of the last account activity or transaction by owner at the Canadian bank + 30 years at the Bank of Canada) if under $1,000. Moreover, unclaimed balances under $500 are kept for 20 years (10 years from the date of the last account activity or transaction by owner at the Canadian bank, plus an additional 10 years held by the Bank of Canada). For more information and changes please go to the Bank of Canada website.

Unclaimed Canadian Bank Accounts Updates

Passing of the Bill C-37 results into the following rules came into effect from March 29th 2007

  • The Bank of Canada will now hold unclaimed balances for thirty years, once they have been inactive for ten years at any of the Canadian financial institutions/banks. Therefore, unclaimed balances’ will now be held for a total of forty years prior to being prescribed.
  • Only the unclaimed balances of less than $1,000 will be prescribed after the forty-year period, previously this limit was less than $500.

Why does the Privacy Act allow personal information of individuals to appear on the Bank’s Unclaimed Balances publicly through website?

  • The Privacy Act permits the disclosure of personal information to be publicly available when an Act of Parliament so authorizes. Bank Act authorized the Office of the Superintendent of Financial Institutions (OSFI) to publish in the Canada Gazette, which is available at most public libraries, information about all unclaimed balances of $100 or more, once they have been inactive for nine years. This information includes the creditor’s name, last known address, and balance amount. The purpose of disclosing privacy is to help people locate balances that may be owed them.

How much unclaimed money is held at the Bank of Canada?

  • There were nearly 940,000 unclaimed bank accounts worth app. $320 million being recorded on the Bank’s books at the end of December 2007 and the oldest unclaimed bank account with its balance is available that dates back to 1900.

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