True North Mortgage
Servus Credit Union
From mountains to prairies to desert badlands, Alberta is the fourth largest province in Canada with over 4.4 million people. Alberta had the second largest year-over-year population growth among Canada’s provinces in early 2021. The Government of Alberta estimates that 80% of Alberta’s population will live in the Edmonton-Calgary corridor by 2046, which includes Red Deer and Airdrie.
The Calgary Real Estate Board found that declines in Alberta mortgage rates and lower housing prices in 2020 have pushed up sales in the Calgary housing market, resulting in a 23% increase in sales in 2020 year-over-year. Calgary housing prices in 2020 were 10% below their all-time highs and 1% lower than in 2019, with the average price of a residential property being $474,000. As of June 2021, the average home price in Calgary was $494,111. It’s predicted that mortgage rates in Alberta will rise in 2022 and 2023.
The Edmonton housing market saw similar gains in sales in 2020, featuring a 26.3% increase in sales in 2020 year-over-year. This was partly led by sales of single-family homes, which increased by 38% in October, while condo unit sales lagged behind at a 2.37% increase. Alberta saw the highest rate of mortgage deferrals in Canada in 2020, at double the proportion of Ontario’s and British Columbia’s.
The average age of a mortgage applicant in Alberta is 35 years old, while the average annual gross income of a mortgage applicant is $67,500.
Canada’s Big Banks can be found throughout the country, and include RBC, TD, Scotiabank, CIBC, and BMO all having branches in Alberta. There are 16 credit unions in Alberta with a total of over 600,000 members. Competitive credit union mortgage rates in Alberta offer a low-interest alternative to the major banks.
The largest credit union in Alberta is Servus Credit Union, which is also the fourth largest credit union in Canada, and includes First Calgary Financial, Chinook Financial, Mountain View Financial, and Legacy Financial. Connect First Credit Union and Vision Credit Unions are the second and third largest credit unions in Alberta.
Banks headquartered in Alberta include Bridgewater Bank in Calgary and Canadian Western Bank in Edmonton. ATB Financial is a provincial crown corporation and is the only financial institution in Canada that is owned by a province. ATB Financial only operates within Alberta.
|Lender||Number of Branches in Alberta|
|Servus Credit Union||102|
|connectFirst Credit Union||41|
|Canadian Western Bank||17|
|Vision Credit Union||17|
|Laurentian Bank||Through B2B Bank|
|First National||Brokers across Alberta|
|CMLS||Brokers across Alberta|
|MCAP||Brokers across Alberta|
|Canada Life||Advisors across Alberta|
|Investors Group||Advisors across Alberta|
Branch data as of July 2021.
Note: Meridian does not operate in Alberta or BC
There are 2,326 licensed mortgage brokers and associates in Alberta, 1,345 of which are members of the Alberta Mortgage Brokers Association (AMBA). Some members of the AMBA include Invis, Mortgage Intelligence, Mortgage Alliance, and Verico, who are all part of the M3 Financial Group, the largest non-bank mortgage originator in Canada. Some other mortgage brokers include Axiom, Apex Mortgage, MMG Mortgages, Trilogy Mortgage Corporation, and Quantus Mortgage Solutions.
The Real Estate Council of Alberta (RECA) licenses 974 mortgage brokerages in Alberta, 634 associate mortgage brokers, and 10,677 mortgage associates as of September 2020. RECA also oversaw 910 complaints and investigations in 2020, sending out $228,550 in fines and administrative penalties.
Through their Real Estate Assurance Fund, RECA paid out over $101,358 from 2019 to 2020 in claims to consumers to compensate for fraud or breaches of trust in real estate and mortgage transactions. Provincially regulated financial institutions, such as credit unions, are overseen by the Alberta Superintendent of Financial Institutions.
Owned by the Province of Alberta, and with 162 branches, ATB Financial is one of the largest financial institutions in Alberta. ATB offers mortgages with terms from 6 months to 7 years, and also offers up to $1,500 cash back for mortgages over $300,000. With an ATB mortgage, you can renew 90 days early, port your mortgage to a new home, and blend and extend your ATB mortgage rates. ATB also lets you build residential outbuildings with your mortgage. This includes adding a garage or suite to your residential property.
As of March 31, 2021, ATB had over $15.8 billion in residential mortgages. 59.9% of ATB mortgages are insured by CMHC, Sagen, or Canada Guaranty, while 40.1% of ATB mortgages are uninsured mortgages. The proportion of insured mortgages with ATB decreased slightly from 2020, where 64.3% were insured.
Most ATB mortgages have an amortization period that is less than 25 years. Only 8.5% of ATB mortgages had an amortization of 25 years to 35 years. Looking at the average loan-to-value ratio (LTV), the average LTV of an ATB mortgage was 68%.
Headquartered in Edmonton, Canadian Western Bank has branches in Alberta, British Columbia, Saskatchewan, Manitoba, and Ontario. Most of Canadian Western Bank’s business is outside of Alberta. In 2020, 32% of CWB's loans were made in Alberta, while 32% were in British Columbia, 23% in Ontario, and 13% in the rest of Canada.
CWB offers fixed, variable, and convertible Alberta mortgage rates. CWB's HOMEWORKS allows you to consolidate your mortgage and other debt into one HELOC, with the option of blending fixed and variable mortgage rates.
Servus Credit Union is the fourth largest credit union in Canada with 380,000 members and $17 billion in assets. With 102 branches throughout Alberta, Servus has the highest number of branch locations out of any other credit union in Canada outside of Quebec. Servus has 22 branches in Edmonton, 11 branches in Calgary, and 6 branches in Red Deer, making Servus accessible for both urban and rural customers.
Servus Credit Union only allows Alberta residents that are within 75 kilometers of their nearest branch to join. A Servus membership equity share costs $1 to join, with the ability to purchase up to $40,000 in Servus shares.
Servus offers high-ratio insured mortgages in addition to conventional mortgages. One of the unique features of being a Servus member is their Profit Share program, which gives dividends that are used to directly pay down your mortgage principal balance. This helps you to pay off your Servus mortgage faster while paying less in mortgage interest. Servus members also receive a 10% discount off an annual membership to Servus Place, a 320,000 square feet community centre located in St. Albert, Alberta.
The amount that you are eligible for under the Servus Profit Share program depends on the balance of your accounts that you hold with Servus. As an example, a $500,000 Servus mortgage would have received a $850 cash back payment in 2021.
Servus's Profit Share has paid $470 million since 2009. In 2020, Servus paid $33 million in cash as patronage dividends back to members. An additional $20 million dividend was paid to common shares as a dividend.
connectFirst Credit Union has 41 branches across Alberta, and offers fixed and variable rate mortgages for properties within Alberta. For first-time homebuyers in Alberta, connectFirst offers a low-rate high-ratio insured mortgage. connectFirst’s insured mortgages are insured by CUMIS, a subsidiary of The Co-operators.
connectFirst offers residential mortgages, commercial mortgages, and agricultural mortgages and loans. In 2020, firstConnect had $2.42 billion in residential mortgages, of which 21% were insured and 79% were uninsured. There was also $1.46 billion in commercial mortgages and $318 million in agricultural mortgages.
A look at firstConnect's mortgage securitization gives us a sneak peek at their cost of funds, which affects their Alberta mortgage rates. For their secured borrowings in the Canadian Mortgage Bond (CMB), they had a pricing yield of 1.0268% to 2.5898%, while their National Housing Act Mortgage-Backed Securities (NHA MBS) had a pricing yield of 1.1565% to 3.2152%, for 4-year maturities.
Vision Credit Union offers residential mortgages, commercial mortgages, and agricultural mortgages. Vision Credit Union’s Profit Shares gives back on average 25% of mortgage interest paid, and boosts savings interest by 25%.
For example, a $300,000 mortgage that pays $12,000 in mortgage interest in 2020 at a 4% mortgage rate would receive $3,000 in profit shares patronage allocation. 10% of your profit share balance can be cashed out every year. This helps to reduce your Alberta mortgage rate.
|Credit Union||Merged With||Date|
|Edson Savings and Credit Union||Servus Credit Union||May 1, 2019|
|Canada Safeway Limited Employees Savings and Credit Union||Servus Credit Union||June 1, 2018|
|Inglewood Savings and Credit Union||Servus Credit Union||March 1, 2018|
|Mountain View Credit Union||Connect First Credit Union||August 1, 2018|
|Legacy Savings & Credit Union||Connect First Credit Union||November 1, 2017|
|Stanco Credit Union||Connect First Credit Union||May 31, 2016|
|CHEC Credit Union||Connect First Credit Union||April 1, 2015|
|Pegasus Savings and Credit Union||Connect First Credit Union||April 1, 2015|
Just like other provinces, the Financial Consumer Agency of Canada (FCAC) and the Office of the Superintendent of Financial Institutions (OFSI) regulates federal banks in Alberta, and customers of these banks are protected by the Canadian Deposit Insurance Corporation (CDIC) for eligible deposits.
Since ATB Financial is a provincial financial institution, not a federal one, ATB is provincially regulated through the ATB Financial Act, Financial Administration Act, Government Accountability Act and Alberta Public Agencies Governance Act. ATB's investor services are still regulated federally by the Investment Industry Regulatory Organization of Canada (IIROC).
Credit unions in Alberta are provincially regulated through Alberta’s Credit Union Act, and is overseen by the Credit Union Deposit Guarantee Corporation (CUDGC) and the provincial trade association Credit Union Central Alberta (Alberta Central).
The CUDGC guarantees all deposits at Alberta credit unions with no limits, excluding investments. For ATB Financial, the Government of Alberta guarantees all deposits. This is unique from some other provinces in Canada that have limits, such as Ontario covering up to $100,000 or Quebec up to $250,000.
Alberta-regulated financial institutions (ARFIs) are also supervised by the Office of the Alberta Superintendent of Financial Institutions (ASFI), similar to the federal Office of the Superintendent of Financial Institutions of Canada (OSFI).
Mortgage brokers are regulated through the Real Estate Act of Alberta, and is administered by the Real Estate Council of Alberta (RECA).
|Regulators||Laws and Regulations|
|Banks||Financial Consumer Agency of Canada (FCAC)|
Office of the Superintendent of Financial Institutions (OSFI)
Canada Deposit Insurance Corporation (CDIC)
|The Bank Act|
|Credit Unions||Office of the Alberta Superintendent of Financial Institutions (ASFI)|
Credit Union Deposit Guarantee Corporation (CUDGC)
Real Estate Council of Alberta (RECA)
|Credit Union Act|
Real Estate Act
Land Titles Act
Personal Property Security Act
Financial Consumers Act
Law of Property Act
|Mortgage Brokers||Real Estate Council of Alberta (RECA)||Real Estate Act|
Law of Property Act
Alberta has among the highest mortgage delinquency rates in Canada. In early 2021, 0.46% of Alberta mortgages were delinquent, meaning that they were 90 days past-due or more, compared to the Canadian average of 0.25%. This history of higher than average mortgage defaults can be seen through to 2013, where Alberta had a delinquency rate of 0.52% compared to Canada’s 0.37%.
|2013 (Q1)||2021 (Q1)|
Alberta’s Law of Property Act includes mortgage rights and foreclosure proceedings. Before a property can be sold by a lender, a redemption period gives the borrower time to repay the mortgage. For farm land, the redemption time is one year, while all other property is 6 months.
If the foreclosure sale does not cover the mortgage, a deficiency judgment may force the borrower to repay the remaining amount to the lender.
Housing prices in Alberta are slightly lower compared to Ontario or neighbouring British Columbia. The average price of a home in Calgary’s housing market was $494,111 for sold homes in June 2021, and $398,229 in Edmonton.
Over the past ten years, from 2011 to 2021, home prices in Calgary’s and Edmonton’s housing market have risen, but they have also lagged behind price growth seen in Toronto or Vancouver. According to Royal LePage, condo prices in Calgary and Edmonton saw no growth over the last ten years, while detached homes grew by just over 2% per year. That’s below the 7% annualized price growth for detached homes seen in Vancouver.
|Property Type||Average 2010 Prices||Average 2015 Prices||Average 2020 Prices||10-Year Price Change||Annualized Price Change|
Source: Royal LePage
Meanwhile, average mortgage payments made by Albertans are higher than the national average. In 2021, the average mortgage payment in Calgary was $1,523. In comparison, the average in Ottawa was $1,303, in Montreal it was $1,162, and the national average was $1,358.
|City||Average Monthly Mortgage Payment (Q1 2021)|
On the other hand, the size of Albertan mortgages haven’t grown as quickly as the rest of the country. In 2021, the average Alberta mortgage was $305,000, compared to the national average of $335,000.
|Average New Mortgage (Q1 2013)||Average New Mortgage (Q1 2021)|